Office of Administrative Law Approves Department of Managed Healthcare’s Proposed Emergency Regulation Regarding Transfer of Enrollees Pursuant to a Public Health Order

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By Alex Ruf

On January 12, 2021, the Department of Managed Healthcare (DMHC) published a notice of emergency rulemaking action with respect to its intent to adopt section 1300.67.02, Title 28 of the California Code of Regulations (CCR), pertaining to the transfer of enrollees due to COVID-19. DMHC’s finding of emergency includes a “non-delay statement,” in which the Director explained that COVID-19 poses such an immediate and serious harm that delaying action to allow public comment would be inconsistent with the public interest. According to DMHC, the emergency regulation is necessary because of COVID-19’s large impact on California and its hospitals, and “any delay in the promulgation of this regulation w[ould] exacerbate the already dire situation within the California hospital system.” The finding of emergency emphasized that “this emergency regulation is crucial to ensure hospitals are able to handle the influx of patients.”

The final text details the public health order and explains the requirements in place for when a health care facility transfers an enrollee. The regulation now mandates that the enrollee’s health plan cannot require prior authorization or prior notice that would delay or prevent the transfer of the enrollee, and that the health plan must reimburse the receiving facility for the medically necessary services provided to the enrollee for the first 72 hours that they are treated at the receiving facility.

On January 6, 2021, Sarah Ream, Chief Counsel for DMHC, had issued an All Plan Letter informing health plans of their obligations to continue to cover emergency services even if an enrollee is transferred.

On January 15, 2021, the Office of Administrative Law (OAL) approved DMHC’s proposed emergency regulation. The regulation is set to expire on November 13, 2021.

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