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September 2010 St@teside

California Legislature Passes Exchanges Bills

California is one of the first states to pass legislation to begin implementation of one of the main aspects included in the federal Patient Protection and Affordable Care Act (ACA).  Health insurance exchanges are a major feature of the private health insurance reforms included in the federal law. While the ACA sets broad parameters for the exchanges and federal regulations will provide further guidance, states are permitted some flexibility in developing their own exchange.

California has passed two companion bills that are contingent on the enactment and operation of each other. Senate Bill 900 establishes the governance of the exchange board. The exchange is established with the state government; however it is an independent public entity not affiliated with an existing agency or department. The exchange board is composed of the Secretary of California Health and Human Services and four other members appointed by the governor and the legislature.  The bill enumerates the duties of the exchange board.

The companion bill, Assembly Bill 1602, establishes the duties and operations of the exchange itself. The legislation includes minimum requirements that the exchange must implement as required under federal law; other provisions allow the exchange some latitude in performing additional duties.

The bills have been sent to the Governor Arnold Schwarzenegger who has not yet signed them.