On October 8th, 2021, the Governor of California, Gavin Newsom, signed into law Senate Bill No. 510, which requires health care service plan contracts and disability insurance policies that provide coverage for hospital, medical, or surgical benefits to cover all COVID-19 testing and vaccinations without cost sharing or prior authorization requirements. The new law goes beyond COVID-19, setting the stage for coverage for testing and vaccination for future pandemics as well. The law specifically provides coverage for:
- Any evidence-based item, service, or immunization that is intended to prevent or mitigate a disease as recommended by the United States Preventive Services Task Force (Task Force).
- A health care service or product related to diagnostic and screening testing for a disease that is approved or granted emergency use authorization by the federal Food and Drug Administration, or is recommended by the State Department of Public Health or the Centers for Disease Control and Prevention (CDC).
Both must be covered no later than 15 business days after the date on which the Task Force or CDC makes a recommendation relating to the item, service, or immunization.
These requirements apply regardless of whether they are delivered by an in-network or out-of-network provider. However, for out-of-network providers the requirements are limited to the duration of the federal public health emergency.
The bill is retroactive to March 4, 2020, the date on which the Governor declared a State of Emergency due to the COVID-19 pandemic, and it is not clear whether plans and providers are expected to refund amounts already paid by patients who received testing. As with most surprise billing laws, the language allows in-network providers to negotiate rates with plans, while leaving out-of-network rates more nebulous. Out-of-network providers without specifically negotiated rates, must be reimbursed in the “amount that is reasonable, as determined in comparison to prevailing market rates.”
Visit Foley’s Health Care Regulatory Group for more information on health care fraud and abuse, reimbursement, compliance, and more. Foley’s objective is to make certain that our health care clients are in the best position to avoid, or successfully defend, regulatory violations. Please reach out to the authors, your Foley relationship partner, or to anyone on our Health Care Regulatory Group with any questions.