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Bill to regulate California health insurance rates is shelved

Los Angeles Assemblyman Mike Feuer doesn't have enough votes in the California Senate to pass a rate-regulation bill that health insurance companies, healthcare providers and others fought.

September 01, 2011|By Duke Helfand, Los Angeles Times

A bill that would allow California officials to regulate health insurance rates for millions of consumers has died in the Legislature after forceful lobbying campaigns by insurers, healthcare providers and other groups.

Assemblyman Mike Feuer (D-Los Angeles) said he is pulling his measure, AB52, because he could not muster a majority of votes in the state Senate, the final stop in a months-long effort to increase state regulators' authority over health insurance premiums.

Feuer said he is putting his bill on hold until next year, when it can be taken up again. It marks the fourth time in four years that Democratic lawmakers have failed to win support for insurance oversight that would mirror the type of regulation already in place for auto policies.

"Until a majority of the Senate supports giving the state authority to reject excessive health insurance increases, millions of Californians will continue to pay unreasonable rates or not be able to afford to go to the doctor at all," Feuer said in a statement.

Feuer's measure ran into a wall of opposition from health plans and groups representing hospitals, doctors and the state's public employees retirement system, among others.

Opponents argued that the bill would create a costly new state bureaucracy. Healthcare providers also said they feared that artificially low insurance rates would lead to reduced payments for their services, resulting in less access to doctors and medical specialists.

"AB52 hit a major roadblock because it's flawed," said Patrick Johnston, president of the California Assn. of Health Plans. "It failed to address the underlying pressures that drive up the cost of coverage."

Supporters said that putting the measure on hold for now spelled bad news for cash-strapped consumers. One advocacy group, Consumer Watchdog in Santa Monica, has announced plans to seek a state ballot measure next year that would roll back health insurance rates and toughen state oversight.

"Californians are paying way too much for health insurance because insurance companies are unaccountable in this state," said Doug Heller, the group's executive director. "It just shows the level of influence insurance companies have in Sacramento."

duke.helfand@latimes.com

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