State insurance departments across the country are continuing to provide guidance in response to the COVID-19 outbreak. In this update, Faegre Drinker spotlights the current California Department of Insurance (CDI) guidance with respect to COVID-19 issues.
- Expects that health insurers will provide increased access to health care services through telehealth delivery platforms and encourage patients to use telehealth delivery options.
- Networks must provide access to medically appropriate care from a qualified provider and failure to adapt insurer networks during the COVID-19 state of emergency, including revision of existing telehealth requirements, and/or increased access through telehealth, may result in an inadequate network and a finding that an insurer’s network discriminates against consumers based upon age, disability, present or predicted disability, expected length of life, degree of medical dependency, health status or medical condition, etc.
- Data Call to all admitted and non-admitted insurance companies to provide information regarding business interruption policies by April 9, 2020
- Insurers will be asked for information regarding the volume of policies written for business interruption coverage, civil authority coverage, contingent business interruption coverage, and supply chain coverage, and specifically for each coverage:
- the number of policies that were written for each coverage.
- how many of the policies are with businesses with more than 500 employees or meet the insurer’s definition of large business.
- how many of the policies are with businesses with fewer than 500 employees or meet the insurer’s definition of a medium business.
- how many of the policies are with businesses with fewer than 100 employees or meet the insurer’s definition of a small business.
Guidance on ‘Essential Businesses’ and Insurance (March 20, 2020)
Insurance Company Obligations to Comply With Insurance Laws During the Coronavirus (COVID-19) Outbreak (March 18, 2020)
- Encouraging all insurance businesses to continue to provide as many core insurance functions as possible during the COVID-19 pandemic while balancing the protection of the health or safety of their employees and other workers.
60-Day Grace Period for Insurance Premium Payments Due to the Disruption Caused by the Novel Coronavirus (COVID-19) Outbreak (March 18, 2020)
- Requests that all admitted and non-admitted insurance companies in California provide their insureds with at least a 60-day grace period to pay insurance premiums for all insurance policies so that those insurance policies are not canceled for nonpayment of premium due to circumstances beyond the control of the insured.
- Requests that customers have the ability to make prompt insurance payments, including alternate methods such as online payments to eliminate need for in-person payment methods.
- Strongly encourages insurers to refrain from using expiration of policyholders’ driver’s licenses or vehicle registrations for 60 days (starting March 16) to:
- affect driver’s ability to secure/maintain auto insurance coverage.
- affect eligibility for Good Driver discount.
- determine eligibility for California Low Cost Automobile policy.
- impact rates charged to any driver.
- Required all health insurers operating in California to submit notification no later than March 20 to the CDI stating how the insurer will handle “potentially impacted insureds” in regards to:
- insurer’s policies concerning prescription fill and refill limitations.
- insurer’s action to ensure consumers are able to access COVID-19 Screening and Testing.
- insurer’s compliance with requirement to provide displaced insureds with access to medically necessary health services.
- insurer’s plans to maximize use of telehealth.
- insurer’s plans to provide access to out-of-network care to consumers if in-network care becomes unavailable.
- insurer’s plans for communicating care options available during the COVID-19 emergency to insureds.
- insurer’s contingency plans to minimize disruption to operations and continue essential business operations
- Directs all insurers providing commercial health insurance coverage to:
- immediately reduce cost-sharing (including, but not limited to, co-pays, deductibles, or coinsurance) to zero for all medically necessary screening and testing for COVID-19.
- notify, as expeditiously as possible, the insurer’s contracted providers that the insurer is waiving cost-sharing as described above.
- ensure the insurer’s advice nurse line and customer service representatives are adequately informed that the insurer is waiving cost-sharing as described above and clearly communicate this to insureds who contact the insurer seeking medically necessary screening and testing for COVID-19.
- inform the insurer’s call center staff to advise insureds to call their provider’s office or advice nurse line for instructions about how best to access care for screening and treatment of COVID-19 prior to in-person visits to a clinic or emergency department.
- prominently display on the insurer’s public website a statement that the insurer is waiving cost-sharing for medically necessary screening and testing for COVID-19, as well as guidance to insureds on how to access care as described above.
- Reminds insurers of existing California laws that require insurers to ensure their insureds are able to access medically necessary care in a timely fashion.
- Encourages insurers to take proactive measures to ensure consumers have access to medically necessary screening and testing for COVID-19, including using telehealth services and waiving prior authorization requirements if due to drug shortages, the insured’s prescribing provider recommends different drugs to treat insured.
Other CDI Communications
- Press Release: Covered California extends special enrollment period through June 30th in response to COVID-19 – including premium subsidies to assist eligible consumers. Read here.
- FAQ on business interruption insurance and other issues affecting California small businesses. Read here.
For additional California COVID-19 information, please visit: