State legislation! What’s that?

Wednesday, July 8th, 2009

* Key Measures from Assembly Pass Senate Health, Head to Additional Committees
* Insurer Oversight Bills Focus on Rescissions, Maternity Coverage, Broker Compensation
* Individual Insurance Market Reform Bill Up Next Week in Senate Health

* More Updates on the Health Access Blog: Kids Will Die; Budget Protests; Myths and Facts on the Governor’s “Reform” of Medi-Cal Eligibility; Newspapers for Health Reform; Does HELP’s Health Reform Go Far Enough? Key Medi-Cal Benefits Disappear; Following the Budget Debate; Major HCAN Action on June 25th in DC and Throughout California; When the Last Resort of MRMIP Isn’t Available; The Case Against the Wyden-Bennett Bill; Advocacy Through Amendments; California Congressmembers Corral Caucuses for Reform; Blind to Budget Impacts?; New Drafts of Federal Health Reform, in the House and in the Senate

* Follow Health Access on Twitter, at @healthaccess, or for quick updates on budget and health reform issues. Followers were among the the first the find out about the disability community protest and arrests in front of the Governor’s office yesterday!

SACRAMENTO — Key Assembly bills crucial to providing protections for California health care consumers were passed Wednesday by the Senate Health Committee, chaired by Senator Elaine Alquist. Votes divided mostly on party lines, even when no opposition was offered.

Next week, the committee is considering additional bills before the ultimate deadline for bills to pass out of policy committee at the end of next week. Among the bills in consideration is AB786(Jones), sponsored by Health Access California, to provide better labeling and transparency of health plans in the notoriously confusing individual insurance market.

Here’s a brief report on some specific bills considered and approved to continue in the legislative process today:

* BROKER COMPENSATION: AB 1521 (Jones) advanced with nine votes in its favor. Sponsored by Health Access California, the measure prohibits health plans from providing financial incentives to agents or brokers in the individual insurance market that are not in the best interest to consumers. These would include paying agents more for signing up people deemed to be healthier than others, and paying more for consumers to enroll in new insurance plans, as opposed to continuing their existing coverage–since consumers who are persuaded to enroll in new plans run the risk of being denied coverage. The bill, by Assembly Health Committee Chairman Dave Jones (D), received no opposition because health care insurance companies maintain they do not engage in these practices, known to crop up in states other than California . Health Access California advocate Beth Capell told senators she was “pleased to support a bill that codified what turns out to be existing, good practice in the industry, and pleased to support AB 1521 before these practices became a problem.”

* RESCISSION: AB 2 (De La Torre) advanced to the Senate Judiciary Committee with six votes. Assemblyman Hector De La Torre’s (D) bill was heavily opposed by the health insurance industry, including Blue Shield, Anthem Blue Cross and Health Net, some of the largest health care plans in California . It would prohibit health insurance companies from engaging in the rescission practice, in which a consumer’s health care coverage is yanked from them retroactively once major medical expenses become necessary. Anthem Blue Cross, Blue Shield and other plans received widespread news coverage of hundreds of cases uncovered in 2007 during which patients were dropped and their coverage revoked retroactive to the moment they signed up for health insurance. The measure requires a standardized questionaire for asking people’s medical history, and for insurers seek approval for any rescission, rather than be “judge and jury” for consumer accused of fraud. Presently, indications are that the industry signs people up without doing research in advance, only to scour medical histories when patients most need the coverage they believed they had. An insurance company representative objected strongly to the bill, said it would “have a devastating impact on the individual market. If we know we have to meet such a high standard, there will be higher premiums and it could have the impact of restricting the number of individuals we insure.” The bill was supported by the California Medical Association and several consumer groups, including Health Access California.

* MATERNITY COVERAGE: AB 98 (De La Torre) would require all insurers to include coverage of maternity services as a basic benefit. Currently it’s possible for people to buy insurance on the individual market only to find maternity services are not covered. Health Access, which supports the bill, estimated that the investment of prenatal care and maternity coverage is paid back three times over because babies are born healthier and encounter fewer costly medical bills later in life. Insurers object to the bill because they said it would lead to fewer choices of products for consumers. Representatives of women’s groups noted that not making maternity services mandatory amounted to discrimination against women.

* COVERAGE FOR PEOPLE WITH DISABILITIES: AB 1269 (Brownley) passed with seven votes and would allow disabled Californians to continue their Medi-Cal coverage when they lose their jobs in this recessionary economy. Nearly every other segment of workers has been extended the opportunity to continue health care coverage upon unemployment, through other bills that have already moved through legislative committees or been passed and enacted into law. Under the bill, supported by Health Access California , beneficiaries would be required to pay for part of the coverage through premiums and cost-sharing and the state would be able to use federal funds for the continued health insurance coverage.

While the legislative leadership is focused on the ongoing budget negotiations, the regular calendar of considering bills continues. For a full list of bills of interest to health care consumers, visit our website to get the Health Access California bill list, at:

Health Access California promotes quality, affordable health care for all Californians.

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