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<ns0:Id>20250AB__192998AMD</ns0:Id>
<ns0:VersionNum>98</ns0:VersionNum>
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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-13</ns0:ActionDate>
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<ns0:ActionText>AMENDED_ASSEMBLY</ns0:ActionText>
<ns0:ActionDate>2026-03-24</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:MeasureType>AB</ns0:MeasureType>
<ns0:MeasureNum>1929</ns0:MeasureNum>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Assembly Member Ortega</ns0:AuthorText>
<ns0:AuthorText authorType="COAUTHOR_ORIGINATING">(Coauthor: Assembly Member Mark González)</ns0:AuthorText>
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<ns0:Legislator>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>ASSEMBLY</ns0:House>
<ns0:Name>Ortega</ns0:Name>
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<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>ASSEMBLY</ns0:House>
<ns0:Name>Mark González</ns0:Name>
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<ns0:Title>An act to add Article 10.9 (commencing with Section 1399.67) to Chapter 2.2 of Division 2 of the Health and Safety Code, relating to health care coverage.</ns0:Title>
<ns0:RelatingClause>health care coverage</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Nonprofit integrated health care service plans: investments: disclosure.</ns0:Subject>
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<ns0:DigestText>
<html:p>Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care, and makes a willful violation of the act a crime. Existing law requires a health care service plan’s assets to be invested in a prudent manner and requires the director of the department to determine the acceptability of a health care service plan’s investments, as specified.</html:p>
<html:p>This bill would require a nonprofit integrated health care service plan regulated by the department to annually disclose its material investment holdings to the department on or before July 1 of each year,
unless otherwise specified by regulation, beginning on July 1, 2027. The bill would require the department to prominently display, and make accessible to the public, those disclosures on the department’s internet website. If a nonprofit integrated health care service plan fails to comply with the disclosure requirements, the bill would require the department to assess a civil penalty against the plan, as specified. The bill would require the department and Covered California to prominently post the plan’s noncompliance status on their internet websites until compliance is achieved. Because a violation of these requirements by a health care service plan would be a crime, this bill would impose a state-mandated local program.</html:p>
<html:p>The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated
by the state. Statutory provisions establish procedures for making that reimbursement.</html:p>
<html:p>This bill would provide that no reimbursement is required by this act for a specified reason.</html:p>
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<ns0:VoteRequired>MAJORITY</ns0:VoteRequired>
<ns0:Appropriation>NO</ns0:Appropriation>
<ns0:FiscalCommittee>YES</ns0:FiscalCommittee>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
<ns0:BillSection id="id_F4A463A1-CA78-4192-855A-FB85E15AED57">
<ns0:Num>SECTION 1.</ns0:Num>
<ns0:Content>
<html:p>The Legislature finds and declares all of the following:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
Nonprofit integrated health care service plans in California receive significant public benefits through tax credits, regulatory privileges, and participation in publicly supported programs such as Covered California.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Californians pay billions of dollars annually in health insurance premiums to nonprofit integrated health care service plans with the expectation that those funds will be used primarily to support
patient care and the delivery of health services.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
Consumers, policymakers, and the public currently have limited visibility into how nonprofit integrated health care service plans invest their financial reserves and surplus funds.
</html:p>
<html:p>
(d)
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Greater transparency regarding investment holdings will help ensure accountability, inform public policy discussions, and strengthen public trust in California’s health care system.
</html:p>
<html:p>
(e)
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Providing public access to investment disclosures will allow consumers and policymakers to better understand how nonprofit health care entities manage significant financial assets derived from patient premiums.
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<ns0:BillSection id="id_334EC8F3-A67E-437B-9ADA-3B8DDD6054FB">
<ns0:Num>SEC. 2.</ns0:Num>
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Article 10.9 (commencing with Section 1399.67) is added to Chapter 2.2 of Division 2 of the
<ns0:DocName>Health and Safety Code</ns0:DocName>
, to read:
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<ns0:LawHeading id="id_9DBB372C-CB3C-40F4-923D-EC8E22E2B468" type="ARTICLE">
<ns0:Num>10.9.</ns0:Num>
<ns0:LawHeadingVersion id="id_50E1D097-B70F-45E2-9433-280B4CD19F5C">
<ns0:LawHeadingText>Nonprofit Integrated Health Care Service Plan Investment Transparency</ns0:LawHeadingText>
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<ns0:LawSection id="id_B1D02F95-0F17-4D81-BF88-06DE54236094">
<ns0:Num>1399.67.</ns0:Num>
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<html:p>
(a)
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A nonprofit integrated health care service plan regulated by the department shall annually disclose its material investment holdings to the department.
</html:p>
<html:p>
(b)
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(1)
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The initial disclosure required by this section shall include material investment holdings covering the five calendar years prior to January 1, 2027.
</html:p>
<html:p>
(2)
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Following the initial disclosure, each nonprofit integrated health care service plan shall update its disclosure annually to include material investment holdings for the immediately preceding calendar year.
</html:p>
<html:p>
(3)
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Annual disclosures shall be submitted to the department on or
before July 1 of each year, unless otherwise specified by regulation, beginning on July 1, 2027.
</html:p>
<html:p>
(c)
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The department shall prominently display, and make accessible to the public, the disclosures required by this section on the department’s internet website.
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<ns0:LawSection id="id_BEB7AF2E-C412-4797-85A0-E6B233D30019">
<ns0:Num>1399.68.</ns0:Num>
<ns0:LawSectionVersion id="id_820D177E-D610-4B8F-B4D7-E5C22990F8A0">
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<html:p>
(a)
<html:span class="EnSpace"/>
If a nonprofit integrated health care service plan fails to comply with the disclosure requirements of Section 1399.67 within 30 days of the reporting deadline, the department shall assess a civil penalty against the plan.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The civil penalty in subdivision (a) shall be one thousand dollars ($1,000) per day for each day the nonprofit integrated health care service plan remains out of compliance following the 30-day grace period.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
A nonprofit integrated health care service plan that fails to comply with Section 1399.67 shall prominently post a notice on its public internet website stating that the plan is not in compliance with California
law requiring disclosure of investment holdings.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The department and Covered California shall prominently post the plan’s noncompliance status on their internet websites until compliance is achieved.
</html:p>
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<ns0:BillSection id="id_00F01528-DA7A-40BF-A4AA-7D23CF494D36">
<ns0:Num>SEC. 3.</ns0:Num>
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<html:p>
No reimbursement is required by this act pursuant to Section 6 of Article XIII
<html:span class="ThinSpace"/>
B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII
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B of the California Constitution.
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