The Assembly just passed AB1324 (De La Torre), which clarifies that insurers can’t rescind coverage if the policy holder had completed applications in good faith.
The bill attempts to address a rash of instances, uncovered in the LA Times, where Blue Cross cancelled patients’ coverage after expensive claims were made, leaving them uninsured and on the hook for hundreds of thousands in treatments.
About 6,000 patients later joined together in a class action suit against the insurer, and have been joined by doctors and hospitals.
On Friday, Blue Cross agreed to change its policy on how it decides to cancel coverage.
AB1324 passed on Monday on a bipartisan vote. Seven Republicans, including Bill Emmerson and Alan Nakanishi who are both members of the Assembly Health Committee, voted in favor of the bill.