Legislation Pending to Further Regulate Medical Insurance Companies
Posted on Tue, Jun 15, 2010
Proposition 103 has passed the state Assembly, advancing it to the California Senate. Proposition 103 seeks to have medical insurance companies justify overhead costs and proposed medical insurance rate increases before increasing medical insurance premiums, co-payments or deductibles.
The restrictions would mostly apply to Blue Cross Blue Shield plans, and health maintenance organizations. Now, they are regulated by the Department of Managed Health Care and the Department of Insurance.
The vote was 43-28, and the only party that voted in favor of the bill was the Democrats. A similar bill was previously introduced twice, but never passed. With the passage of medical care reform, it gave this legislation more support than it had ever had. Plus, with Anthem Blue Cross's recent rate hikes of up to 39%, this bill had more of a reason than ever to pass.
The medical reform law has set aside $250 million to states to assist in rate reviews.
Medical insurance companies are insisting that the medical reform bill does not address the core issue of higher rates, which is the increasing cost of medical care.