Consumer Protection

The California Legislature passed a measure Tuesday that would curtail the ability of insurance companies to cancel coverage for patients diagnosed with serious illnesses. The bill addresses a practice known as rescission, which was the subject of a series of articles in The Times exposing how several major healthcare companies, including Blue Cross and Health Net Inc., canceled medical coverage for sick policyholders. The practice has since been the subject of probes by law enforcement agencies in California and sparked congressional hearings.

The Obama White House, stepping in where other Democrats feared to tread, has launched a potentially risky fight with the U.S. Chamber of Commerce -- attempting to bypass the nation's most powerful business organization and develop independent ties to corporate America. In recent weeks, President Obama, his Energy secretary and one of his other most senior advisors have begun criticizing the chamber publicly, casting it as a profligate lobbying organization at odds with its members in opposing the administration on such issues as consumer protection and climate change.

Maria Casanova, an assistant professor of economics at UCLA, toyed with the idea earlier this year of buying a foreclosed property near the Westwood campus. She signed up for a prominent listing service called RealtyTrac. Casanova, 31, canceled her subscription not long after. Yet a few days ago she discovered that some other real estate company she'd never heard of has been billing her almost $45 a month for the last eight months. Consumer advocates say it's an all-too-common problem: People signing up for one thing online and inadvertently signing up for something else that comes with recurring monthly charges.

Healthcare overhaul bills working their way through Congress could jeopardize laws in California and other states that require insurers to pay for treatments such as AIDS testing, second surgical opinions and reconstructive surgery for breast cancer patients. What's more, the federal legislation could make it virtually impossible for states to enforce other consumer protection laws, such as the right to appeal if an insurer denies coverage for a particular treatment. Healthcare overhaul bills in both the Senate and the House would open the door to insurers selling policies across state lines -- which some lawmakers fear could allow health plans to take advantage of the lenient rules in some jurisdictions while avoiding tougher enforcement regimes in places like California.

Facebook's terms of service just got a status update. The social-networking site "wouldn't share your information in a way you wouldn't want." In a blog post Monday, founder Mark Zuckerberg tried to address privacy concerns raised recently by the Consumerist website, which is owned by Consumers Union, the publisher of Consumer Reports. The Consumerist's post pointed out that a change Facebook made to its terms of service left the impression that the site could keep and use copies of user content (photos, notes and personal information, for example)

The Federal Trade Commission has released two videos spoofing commercials that promise free credit reports but try to sell you other products. The FTC videos are a takeoff on FreeCreditReport.com's ads, such as the one featuring a guitar strummer wearing pirate clothes and singing in a fish restaurant. The FTC video shows a kilt-wearing guitarist singing: "Beware of the others. There is always a catch. They claim to be free, but strings are attached. Their ads can be funny so don't be deceived.

Flexing newfound muscle as consumer protector, the Federal Reserve on Thursday banned ATM and debit card overdraft fees unless customers have opted to pay to ensure that balance-busting transactions go through. The new rules, which take effect July 1, mean that if you don't have overdraft protection, any debit card purchase or ATM cash withdrawal will be rejected if it exceeds the amount of money in your account. And if you do want overdraft protection, your bank will have to give you a notice explaining the service and its fees before you can accept it. Overdraft fees typically range from $10 to $38 for each transaction, according to a 2008 study by the Federal Deposit Insurance Corp.

A new, seven-member consumer advisory panel will be set up within the state Department of Insurance and, unlike the first panel, this one will have a majority of consumer members, the state's insurance commissioner said. Insurance Commissioner Roxani M. Gillespie, in a letter to a wide range of parties interested in insurance issues, asked for suggestions on possible members and said she intends to name the members in January.

After an unprecedented year of toy recalls, the Consumer Product Safety Commission is adding staff at the nation's busiest ports and pledging to work more closely with the U.S. Customs Service to stop suspect imports and identify potential hazards before toys hit the market. Congress provided the CPSC with an additional $20 million for the current fiscal year but has stalled on legislation that would significantly strengthen the agency's regulatory powers. Under the new initiatives, the CPSC will begin to place full-time staff at some of the nation's busiest ports.

Easy credit is great. Except when it's too easy. Millions of people are now in danger of losing their homes as a result of the meltdown in the sub-prime mortgage market. But millions more face the prospect of financial ruin because of an even more ubiquitous problem: the danger of making only minimum payments on monthly credit card bills. Michelle Schimeck, 35, discovered this for herself after running up a combined balance of more than $20,000 on five credit cards.