Health care coverage: essential health benefits.

Senator Menjivar's proposal to review and update California's essential health benefits benchmark plan signals a significant shift in how the state will define required healthcare coverage starting in 2027. The legislation establishes a framework for transitioning from the current benchmark plan, based on the Kaiser Foundation Health Plan Small Group HMO 30, to a new standard that will shape coverage requirements for individual and small group health insurance markets.

The bill modifies both the Health and Safety Code and Insurance Code to limit the applicability of existing benchmark plan benefits to plan years through 2027. These changes affect health care service plans regulated by the Department of Managed Health Care and health insurance policies overseen by the Department of Insurance. The current benchmark plan's comprehensive coverage requirements - including ambulatory services, emergency care, hospitalization, maternity care, mental health services, and prescription drugs - remain in effect until the transition.

Under this legislation, health insurers and service plans must maintain coverage for federally-mandated essential health benefits while preparing for the upcoming benchmark transition. The bill preserves existing protections, such as mental health parity requirements and prohibitions on combining limits for habilitative and rehabilitative services. Specialized health care service plans, Medicare supplement plans, and grandfathered health plans retain their current exemptions from these requirements.

The measure includes provisions for regulatory implementation, authorizing both departments to adopt emergency regulations to ensure compliance. While establishing the framework for change, the bill maintains the state's position of not assuming costs for benefits beyond those designated as essential health benefits, and preserves health plans' ability to offer additional benefits beyond the required minimum coverage.