Key California Health Care Bills to Save Consumers Hundreds of Millions of Dollars Now on Governor’s Desk

After the California Legislature’s last week of session this year, Governor Newsom now has a month to consider key health consumer protection bills that would provide significant savings to California patients and the public.
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For Immediate Release: Friday, September 13, 2019

CONTACT:
Anthony Wright, executive director, Health Access California, awright@health-access.org, 916-870-4782 (cell)
Rachel Linn Gish, director of communications, Health Access California, rlinngish@health-access.org, 916-532-2128 (cell)

KEY CALIFORNIA HEALTH CARE BILLS TO SAVE CONSUMERS HUNDREDS OF MILLIONS OF DOLLARS NOW ON GOVERNOR’S DESK

  • Advocates urge Governor Newsom to sign health care legislation currently pending on his desk that will provide greater oversight over the health industry and help save consumers hundreds of millions of dollars: 
    • AB 824 (Wood) would lower prescription drug prices by preventing “pay for delay” practices
    • AB 731 (Kalra) expands review of unreasonable premium increases
    • AB 929 (Rivas) requires greater transparency and accountability from insurance companies for higher health care costs, as well as quality and equity
    • AB 290 (Wood) stops dialysis companies from steering patients to coverage for the purpose of higher reimbursement
  • Bills gained broad support from health and consumer advocates to overcome health industry opposition

SACRAMENTO, CA – After the California Legislature’s last week of session this year, Governor Newsom now has a month to consider key health consumer protection bills that would provide significant savings to California patients and the public. Strongly backed by a broad coalition of consumer and community organizations and others, these bills overcame well-financed opposition from health industry players to reach the Governor’s desk.

PRESCRIPTION DRUG PRICES: AB 824, by Assemblymember Wood and sponsored by Attorney General Xavier Becerra, and supported by dozens of consumer advocate and health care groups, helps curb “pay for delay” pricing practices by pharmaceutical and generic drug manufacturers. The bill would help police such anti-competitive agreements where brand name pharmaceutical companies pay generic drug makers to slow down or stop lower-cost alternative medications from entering the marketplace. The bill does not ban settlements that bring generics to the market sooner, but instead puts the burden of proof on the drug companies to ensure that any agreements are pro-consumer, and not just for making more money allowing them to charge a monopoly price on certain drugs. In 2010, the Federal Trade Commission estimated Americans pay $3.5 billion a year more for medications because of these “pay for delay” practices, and that figure has likely gone up significantly since that finding. AB 824 ensures that lower-cost generic alternatives reach the market sooner, providing the cost relief many Californians need.

“AB 824 will help lower the inflated prices of prescription drugs for millions of struggling Californians. We urge Governor Newsom to help save California consumers hundreds of millions dollars by signing this bill to prevent the problematic, price-gouging practice of pay-for-delay by the prescription drug companies,” said Yasmin Peled, policy advocate at Health Access California, a strong supporter of AB 824.

INSURER ACCOUNTABILITY: AB 731, by Assemblymember Ash Kalra and co-sponsored by Health Access, California Labor Federation, SEIU California, UNITE HERE, and the Teamsters, seeks to expand and enhance health plan rate review. This oversight has helped save consumers hundreds of millions of dollars by shining a light on unreasonable rate increases for those in the individual and small group insurance markets, and AB 731 extends these protections to the ten million Californians in the large group market. More health plans will have to justify that their rates are reasonable, and provide more data, including by region, and by how much they pay providers in comparison to Medicare.

“Rate review is a proven tool to prevent unreasonable rate increases. More Californians should have the security that their health insurance premiums have been checked to be justified and reasonable. We hope that Governor Newsom will sign AB 731 to help expand rate review’s benefit to three times as many people people and save consumers millions of dollars,” said Anthony Wright, executive director of Health Access California.

AB 929 by Assemblymember Luz Rivas and co-sponsored by California Pan Ethnic Health Network and Health Access California, requires plan-specific reporting on cost, quality, and health disparities for all health plans that participate in Covered California.

“We need greater transparency from health care plans on cost, quality, and equity to better track where they are succeeding or in need of improvement. Governor Newsom should sign AB 929 so that consumers can make informed choices, and Covered California has the information to create the best plan of action to improve our health care system,” said Ronald Coleman, policy director for Health Access California.

DIALYSIS: AB 290 by Assemblymember Jim Wood places greater oversight over third-party payments  that steer patients into plans that will reimburse providers higher amount for dialysis or other treatment.

“We shouldn’t let dialysis or other providers steer patients away from the public coverage they are entitled to in order to game the health system so they can get much higher reimbursements,” said Wright. “Health care is expensive enough without health providers playing these games to raise their rates even higher. We urge Governor Newsom to sign this important patient protection measure.”

Consumer, community, patient, and purchaser organizations have prioritized these pieces of legislation. All bills need to be acted on by Governor Newsom by October 13th.