The California state legislature is moving forward on a collection of health insurance reform bills, some specially tailored to conform to sections of the federal Patient Protection and Affordable Care Act (PPACA).
The bills were sponsored by the California Department of Insurance (CDI).
Most of the sponsored bills were approved by committees by April 27 and are eligible for further consideration by the Legislature, according to the department, which has a good record of getting sponsored bills passed.
AB 2138 is the only bill that passed out of committee unanimously. It is authored by Assembly Member Bob Blumenfield, and passed out of the Assembly Insurance Committee on a 13 to 0 vote. The bill would double (to 20 cents from 10 cents) the current annual assessment per insured paid by health and disability insurers.
The bill would increase funding to local district attorneys so that they can investigate and prosecute health and disability insurance fraud throughout the state. Budget shortfalls have hampered the pursuit of prosecution on annuity suitability and elder abuse cases similar to the Glenn Neasham felony theft case out of Lake County, some have said, but it is unclear if these funds to be paid to DA funding coffers could only be used for health and disability prosecutions.
“Health and disability insurance fraud is a critical problem for policyholders, providers, insurers, and California’s economy and is increasing in sophistication, complexity, and volume. This bill will provide much needed resources to fight growing insurance fraud in these areas, especially in light of federal health care reform,” stated the CDI.
AB 2152 would update disclosure requirements. It would require a health insurer to submit a transition plan to CDI at least 75 days before terminating a provider contract. That way consumers aren’t left paying big medical bills just because their insurer no longer contracts with their provider and they didn’t know it was out of network. AB 2152 passed out of the Assembly Health Committee 12-4.
AB 1846 would establish a licensing framework for Consumer Operated and Oriented Plans (or CO-OPs) to provide the CDI with what it describes as the “necessary regulatory oversight” over these new non-profit health insurers.
CO-OPs are supposed to be non-profit, member-run health insurance issuers that will be newly licensed under state law to offer competitive coverage in the individual and small group markets.