Senator Wiener’s Health Plan Accountability Act, SB 858, Passes Assembly Health Committee

June 30, 2022

SACRAMENTO - Today, Senator Scott Wiener’s (D-San Francisco) legislation to improve health plan accountability, Senate Bill 858, passed the Assembly Health Committee by a vote of 11-2. SB 858 will now head to the Assembly Appropriations Committee. SB 858, the Health Plan Accountability Act, updates and increases the penalty amount for health plans that violate state law in denying or delaying timely access to care.

“Fines are one of the ways we can actually hold health plans accountable if they break state law,” said Senator Wiener. “But fines are ineffective if they’re too low to matter to health plans. SB 858 updates fine amounts to ensure they actually lead to accountability so people get the health care that they are legally entitled to.” 

Health plan premiums have quadrupled in the past 20 years, while fine amounts for health plan violations of the law haven’t changed since 1975. This allows plans to skirt responsibility and withhold care if they deem the fine amount inconsequential or just a cost of doing business. For example, in October 2020, California’s Department of Managed Health Care (DMHC) fined Anthem Blue Cross $1.2 million for not providing gender-affirming care, which is required by state law. Even after they were notified of the fine, they failed to provide these services to enrollees. This last March, the Department of Managed Health Care and Department of Health Care Services jointly imposed fines on the Local Initiative Health Authority for Los Angeles County totalling $55 million, which was prompted by an investigation by the Los Angeles Times. While this fine is the largest penalty in state history, it comes down to only a few hundred dollars per violation. 

SB 858 increases the penalty amounts for civil penalties from $2,500 to a maximum of $25,000 when they violate standards by failing to provide coverage for medically-necessary care, behavioral health care services, gender-affirming care, timely access to care, or other critical consumer protections. When health plans fail to comply with state law, their actions can pose significant – and even life-threatening – health challenges. By strengthening California’s ability to levy behavior-changing fines on non-compliant health plans, access to health care will improve.

SB 858 gives the Department of Managed Healthcare the additional authority to levy higher fines and impose corrective action when necessary. SB 858 will modernize penalty amounts, and update the methodology, to ensure penalty amounts reflect the true harms caused to enrollees. Effective civil and administrative penalties are enforcement actions that give regulators more tools to enforce the consumer protections we all support. 

SB 858 is sponsored by Health Access California.