MAJOR CA BILLS TO INCREASE ACCOUNTABILITY IN OUR HEALTH CARE SYSTEM UP IN COMMITTEE THIS WEEK
- AB 2080 (Wood) improves oversight by the CA Attorney General over for-profit health care mergers, to preserve access and prevent inflated costs due to consolidation
- SB 858 (Wiener) increases fines on health plans that don’t meet requirements for timely access to care and other consumer protections, updating fines not changed since the 1970s
- Both bills to be heard this week in Health and Judiciary Committees, before a crucial end-of-week deadline
SACRAMENTO, CA – California legislative committees are set to hear two health care bills this week that would increase accountability for health care consumers while preserving their access to care and preventing inflated health prices. SB 858 by Senator Scott Wiener, which will be heard today (Tuesday) in Senate Judiciary Committee, updates penalty amounts that the state can levy on health plans that don’t meet consumer protection standards. AB 2080 by Assemblymember Wood, which will be heard today (Tuesday) in Assembly Health Committee and on Thursday in Assembly Judiciary Committee, would provide needed oversight on for-profit hospital mergers to ensure they are in the best interest of the California public.
“The California Legislature can and should take action this year to ensure access to care and contain rising health care costs,” said Anthony Wright, executive director of Health Access California, the lead supporter of SB 858 and AB 2080. “These bills will increase state oversight on health plans and the health industry, whether through the Attorney General or the Department of Managed Health Care, to ensure consumers’ best interests are taken into account when reviewing hospital mergers or when setting fine amounts for health plans. As families struggle to find and pay for health care, these bills will make sure that for-profit hospitals and health plans are responding to the needs of California consumers first and foremost.”
UPDATING HEALTH PLAN FINES: Despite strong consumer protections for 27 million Californians in health plans regulated at the Department of Managed Health Care (DMHC), many are still denied or delayed in getting medically necessary services.
“DMHC’s financial penalties have not been updated for decades, and plans may find it cheaper to pay the penalties instead of improving care. Some fine amounts have not been updated since 1975 when gas was 59 cents a gallon. Fine amounts for violations related to grievance handling and other specific consumer protections have not been updated since 1999 or 2000—and in the last 20 years, health insurance premiums have not just doubled, premiums today are four times as high as they were in 1999,” said Diana Douglas, Health Access California’s manager of policy and legislative advocacy.
SB 858 (Wiener) would increase the minimum civil fines imposed by DMHC from a maximum of $2,500 per violation to a minimum of $25,000. SB 858 would increase fixed fine amounts by four, based on the rate of increase in health insurance premiums since 1999. SB 858 also increases future fine amounts along with healthcare premiums and out-of-pocket costs.
INCREASING OVERSIGHT ON HEALTH CONSOLIDATION: For decades, the California’s Attorney General has reviewed, held public hearings, imposed conditions, and approved nonprofit hospital mergers so that consumer impact could be measured and considered. AB 2080 (Wood) extends that existing authority and process to for-profit hospitals, medical groups, and the other major health industry transactions.
“As mergers reshape the health system we all rely on right under our feet, these for-profit deals should get proper public scrutiny and input on their impact on cost, quality, equity and access. The oversight is important since mergers can decrease competition for consumers or result in the cutting of services, the lowering the quality and accessibility of care, and increasing prices. Health care consolidation is one of the major drivers of increasing health care costs – which have been rising much faster than inflation for many years. Health prices in California have less to do with the cost of providing the care, the quality of care, or the health outcomes, than with the relative size and market power of health providers to be able to charge whatever they can. AB 2080 is needed so that consumers best interest – and the health of the health care market – is taken into consideration before the AG approves a for-profit merger,” said Wright.
Both of these bills are part of the larger #Care4AllCA campaign of over 70 organizations advocating for bold state action now towards a universal health care system that is affordable, high quality, and accountable to consumers.