Health care coverage: independent medical review.

Senator Wiener's health care oversight legislation establishes new reporting requirements and financial penalties for California health insurers and plans with high rates of overturned coverage denials. The measure requires annual reporting of all treatment denials and modifications, categorized by type of care and diagnosis, with data disaggregated by age and other demographic factors.

Under the bill, insurers and plans must submit detailed information about denial reasons, including medical necessity determinations, billing issues, and network status. The Department of Managed Health Care and Department of Insurance will compare these denials against independent medical review outcomes. Organizations with 10 or more reviews annually face penalties if more than 50% of denials in any care category are overturned, starting at $25,000 for first violations and escalating to $500,000 for subsequent infractions.

The legislation creates dedicated accounts within state funds to collect these penalties, with proceeds available upon legislative appropriation to offset implementation costs. Penalty amounts adjust every five years based on medical care cost inflation beginning in 2031. Initial reports from insurers and plans are due June 1, 2026, with the departments required to publish analysis of the data starting in 2028.

The reporting and enforcement provisions apply equally to health insurers regulated by the Department of Insurance and health care service plans overseen by the Department of Managed Health Care. The departments must coordinate to ensure consistent diagnosis categories and demographic reporting requirements across both regulated sectors.