HEALTH ACCESS UPDATE
Thursday, September 30, 2010
GOVERNOR SIGNS LIEU BILL TO LIMIT EMERGENCY ROOM DOCTOR CHARGES
FOR THE UNINSURED
GOVERNOR VETOES PATIENT PROTECTIONS, Including
* AB1600(Beall), to Require Mental Health Parity in Health Coverage
* AB2042(Feuer),to Limit Rate Hikes and Changes to Once a Year
* AB542(Feuer), to Prevent Medi-Cal Payment for “Never Event” Medical Errors
* AB2540(De La Torre) on Increase Fines for Rescissions
* SB56(Alquist), to Foster New Public Health Insurance Options
KEY HEALTH REFORM BILLS LEFT on the Governor’s Desk, Still Pending for Final Day:
* AB1602(Perez) & SB900(Alquist), to Create a New Health Insurance Exchange
* SB890(Alquist), to Categorize Benefits to Allow for Better Comparisons of Plans
* AB1825(De La Torre), to Phase-In Maternity Coverage as a Basic Benefit
* AB2244(Feuer), to Limit Premiums for Children with Pre-existing Conditions
* AB2470(De La Torre) on Eliminating Rescissions
* SB1088(Price), to Allow Young Adults Up to Age 26 To Stay on Parental Coverage
* SB1163(Leno), to Provide 60 Day Notice and Transparency on Rate Hikes
* AB2345(De La Torre), to Eliminate Cost-Sharing for Preventative Care
The Governor has begun to sign and veto the patient protection bills on his desk, including over a dozen measures to implement and improve upon the new federal health law. He has one last day, until the end of today, Thursday, September 30th, to make final decisions on whether to sign or veto the pending legislation.
A list of the measures related to implementing federal health reform, and how they fared in the California Legislature, is available on the front page of the Health Access website.
GOVERNOR SIGNS AB1503(Lieu) TO PREVENT UNFAIR CHARGES BY EMERGENCY ROOM DOCTORS FOR THE UNINSURED: Governor Schwarzenegger signed one key patient protection yesterday, AB 1503, sponsored by Health Access California. The bill provides consumer protections to ensure uninsured and underinsured patients are charged fair prices for emergency physician services. The bill would require physicians who provide emergency medical services in hospitals to implement a discount payment policy, including a limited rate, for financially qualified patients. The bill would also place limits on the collections activities of these physicians.
These protections are needed because emergency room patients are not in a position to shop around or bargain for the best price. These first-in-the-nation fair pricing consumer protections ensure that self-pay emergency room patients pay a fair price. Just like with hospital bills–an issue addressed in earlier legislation in 2006–uninsured patients shouldn’t have to pay significantly more than what is billed to other payers and insurers, as has often been the case.
THE GOVERNOR’S VETOES: The Governor also vetoed several bills yesterday, including the following:
* MENTAL HEALTH PARITY: AB1600, by Assemblyman Beall, would have required mental health parity in private coverage. The bill would have ensured that patients should be covered for mental health similarly to how they are covered for physical health, and provided a smoother transition to the minimum benefit standards under federal health reform in 2014. See veto message.
* LIMITING RATE HIKES TO ONCE A YEAR: AB2042, by Assemblyman Feuer, and sponsored by Health Access California, would have limited health plans from raising rates or changing premiums, cost-sharing, or benefits to once a year. The bills were intended to provide stability to patients who want to know their premiums don’t change mid-year, and thus mess up their budget. See veto message.
* JOINT VENTURES AND PUBLIC HEALTH INSURANCE OPTIONS: SB56, by Senator Alquist, would have fostered new public health insurance options by allowing county-based Medicaid managed health care plans (such as Alameda Alliance for Health, LA Care, and San Francisco Health Plan) to enter into joint ventures, offer broader provider networks, and be viable choices in the marketplace. See veto message.
* FINES FOR RESCISSION: AB2540, by Assemblyman De La Torre, would have increased fines for rescinding, canceling, or limiting of a policy or certificate due to the insurer’s failure to complete medical underwriting before issuing the policy or certificate or after a claim has been filed. Still pending is the other bill by Assemblyman De La Torre that curtails the practice of rescission itself. See veto message.
* MEDICAL ERRORS: AB542, by Assemblyman Feuer, would have set up a process toward the goal that Medi-Cal would no longer pay for “never events,” major medical errors that should not “never” happen–like surgery on the wrong body part. This bill was intended to encourage providers to set up systems that prevent such errors before they occur. See veto message.
In most of the veto messages, the Governor suggested that the bill was unnecessary and the objective of the measure could be accomplished in another way and sometimes better. Health and consumer advocates have said they are committed to continue to work, with this Governor and with whoever the next Governor is, on these issues: ending rescission, to reducing adverse events and medical errors, to expanding the role of Medicaid managed care plans, and to reviewing rate hikes annually.
KEY BILLS STILL PENDING. Announcements on the following key patient protections measures–including those that would celebrate their passage to date– are due by the end of today. They include:
Creating a Consumer-Friendly, Transparent Health Insurance Market
* CREATING A NEW EXCHANGE WITH BARGAINING POWER: AB 1602, by Speaker Perez and SB 900, by Senate Health Committee Chair Alquist and Senate President Pro Tem Steinberg are complementary measures that establish a new health insurance Exchange, a core element of the new federal health reform law. In 2014, the new Exchange will be the new one-stop shop for getting health coverage for individuals and small businesses, both providing easy-to-compare choices, access to federally-funded subsidies to make coverage affordable, and the bulk purchasing power (similar to large employers or CalPERS) of millions of Californians to bargain for the best price and value.
Without an exchange, individual consumers are at the mercy of the big insurers, without any purchasing power, in a complex and confusing marketplace. A new, independent exchange can dramatically improve the way Californians individuals and small businesses get coverage—making such decisions easier, more understandable, and more affordable. With over 4 million Californians eligible to participate in the exchange in 2014 (and more later), these bills begin a process to ensure a new exchange is ready to help patients and draw down federal subsidies on day one. AB1602 establishes the new, indepedent agency; SB900 set ups its governance, as a 5-member board to be appointed by the Governor and Legislature.
Setting Minimum Standards
* TRANSITIONING TO A MORE TRANSPARENT AND COMPARATIVE MARKET: SB 890 by Senator Alquist, would reform the individual insurance market, by setting basic benefit levels and classifying health plans in tiers (Platinum, Gold, Silver, Bronze) based on actuarial value. This would allow consumers better ability to make apples-to-apples comparisons, so that consumers can have some idea of how much of their medical costs they may need to pay out-of-pocket with different health plans.
The bill helps California implement and transition to federal health reform in other ways as well:
* by instituting the new federal requirements on medical loss ratios, to ensure that premiums dollars go to patient care rather than administration and profits; and
* by eliminating annual and lifetime caps on coverage that cause individuals with serious illnesses to incur significant medical debt.
* MATERNITY COVERAGE: AB 1825, by Assemblyman De La Torre, phases in a requirement for all health insurance plans to cover maternity care. Plans would be required to have maternity coverage, but until 2014 they can impose a one-year waiting period. This measure starts to provides equity for women trying to buy coverage, saves the state money by preventing women from having to rely on public programs for maternity benefits, and crucially helps provide the public health benefit of getting babies the prenatal and early care coverage needed to live healthy and productive lives.
Providing Access, Including for Those with Pre-Existing Conditions
* ACCESS & AFFORDABILITY FOR CHILDREN WITH PRE-EXISTING CONDITIONS: AB 2244, by Assemblyman Feuer, implements the federal prohibition on denying coverage to children with pre-existing conditions, and limits the amount that insurers can charge to cover those children. While the federal health law takes a crucial first step this September, by prohibiting insurers from denying coverage to children with pre-existing conditions, this state bill would take another step in making reform real, by also limiting how much insurers can charge children with pre-existing conditions, within an open enrollment period. The measure would also bar those insurers not selling child-only products from selling new products in the full individual market for five years.
Federal law will prohibit such premium differences in 2014, but this bill phases in this affordability help sooner, and provides a smoother glide path for California’s market to transition. Proponents say the bill would save tens of millions in the state budget, giving families the opportunity to buy private insurance rather than having them fall onto public health coverage programs.
* ELIMINATING RESCISSIONS: AB2470, by Assemblyman De La Torre, would help implement health reform by seeking to eliminate rescissions, so patients don’t have their coverage yanked away at the time when they most need it. The bill would standardize the process of underwriting and asking about pre-existing conditions when accepting subscribers in the first place, and require regulatory approval for any insurer seeking to retroactively deny coverage due to fraud. This is an important protection in the interim until 2014, when insurers will be required to take patients without regard to pre-existing conditions.
Other Consumer Protections
* REQUIRING 60-DAY NOTICE AND TRANSPARENCY ABOUT RATE HIKES: SB 1163, by Senator Leno, would require insurers to make information public about premium increases, available for review not just by the regulator but by the public on the insurers’ and regulators’ websites. The bill would also require insurers give 60 days notice to consumers and to the public before raising premiums. Currently, this information is not public, even the notice of a rate hike: insurers only need to give 30 days indication to subscribers, and there is no public notice requirement. This bill expands California regulators’ authority, especially at the Department of Managed Health Care, to review rate information and better take advantage of the new federal funding available.
* YOUNG ADULT COVERAGE: SB1088, by Senator Price, would implement the federal health law that allows young adults up to age 26 to stay on their parents’ group coverage.
* PREVENTATIVE CARE: AB 2345, by Assemblyman De La Torre, would implement the federal health law by requiring insurers to eliminate cost-sharing for some preventive services such as pap smears, mammograms, other cancer screenings, and immunizations.
The passage of this legislation is an important step toward establishing California as a leader in the implementation of health care reform. If the Governor signs these bills into law, California consumers will begin to benefit from some of the provisions of the federal law as well as some state-only improvements.
A new report by Health Access California documents the new patient protections in place as a result of the new federal health law, as well as additional changes that are coming online from both the federal government and from California-specific implementation efforts, including potential pending state legislation now on the Governor’s desk.