Health care coverage: mental health and substance use disorders: inpatient admissions.

Plain English Breakdown

The official source material does not provide specific details about the types of penalties that can be imposed or the exact nature of sanctions for violating Medi-Cal provisions.

California Mental Health Protection Act

AB-384 prohibits health care plans and Medi-Cal from requiring prior authorization for inpatient admissions and services related to mental health and substance use disorders, effective January 1, 2027.

What This Bill Does

• Prohibits health care service plan contracts or insurance policies issued, amended, or renewed on or after January 1, 2027 from requiring prior authorization for inpatient admissions related to mental health and substance use disorders if medically necessary.
• Also prohibits these plans from requiring prior authorization for any medically necessary health care services provided while the patient is admitted for such conditions.
• Authorizes the Department of Managed Health Care or Insurance Commissioner to impose penalties on companies that violate these rules.
• Prohibits Medi-Cal from requiring prior authorization for inpatient admissions and related medical services for mental health and substance use disorders, subject to federal approval and funding.

Who It Names or Affects

• People with mental health or substance use disorders who need inpatient care.
• Health insurance companies and managed care organizations.
• The Department of Managed Health Care and the Insurance Commissioner.
• Medi-Cal beneficiaries and providers.

Terms To Know

Prior Authorization

A process where a health plan must approve medical treatment before it can be given to someone who is insured or enrolled in a plan.

Medi-Cal

A government program that helps low-income people get health care services, funded partly by the federal government and run by California.

Limits and Unknowns

• The bill only applies to contracts or policies issued, amended, or renewed on or after January 1, 2027.
• Implementation of Medi-Cal provisions depends on getting approval from the federal government and receiving federal funding.

Official Summary Text

AB 384, as amended, Connolly.
Health care coverage: mental health and substance use disorders: inpatient admissions.
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 provides for the regulation of health insurers by the Department of Insurance. Existing law requires a health care service plan or health insurer to ensure that processes necessary to obtain covered health care services, including, but not limited to, prior authorization processes, are completed in a manner that assures the provision of covered health care services to an enrollee or insured in a timely manner appropriate for the enrollee’s or insured’s condition, as specified.
This bill, the California Mental Health Protection Act, would prohibit a health care service plan contract or health insurance
policy issued, amended, or renewed on or after January 1, 2027, that provides coverage for mental health and substance use disorders from requiring prior authorization (1) for an enrollee or insured to be admitted for medically necessary 24-hour care in inpatient settings for mental health and substance use disorders, as specified, and (2) for any medically necessary health care services provided to an enrollee or insured while admitted for that care. The bill would authorize the Director of the Department of Managed Health Care or the Insurance Commissioner, as applicable, to assess administrative or civil penalties, as specified, for violations of these provisions.
Because a willful violation of these provisions by a health care service plan would be a crime, the bill would impose a state-mandated local program.
Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care
Services and under which qualified low-income individuals receive health care services through various delivery systems, including managed care. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions.
This bill would prohibit requiring prior authorization under the Medi-Cal program (1) for admission for medically necessary 24-hour care in inpatient settings for mental health and substance use disorders, as specified, and (2) for any medically necessary health care services provided to a beneficiary while admitted for that care. The bill would authorize the Director of the State Department of Health Care Services to terminate a contract with, or impose sanctions on, an entity that violates these provisions. The bill would condition implementation of these provisions on the availability of federal financial participation and the receipt of any necessary federal approvals.
For purposes of these provisions, this bill would provide that 24-hour care in inpatient settings includes, among other things, a general acute care hospital and an acute psychiatric hospital, as specified.
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.
This bill would provide that no reimbursement is required by this act for a specified reason.

Current Bill Text

Download Bill PDF