Democratic lawmakers in California are promoting a bill (AB 52) that would provide the state insurance commissioner with greater control over health insurance rate increases, the Santa Rosa Press Democrat reports.
Assembly members Jared Huffman (D-San Rafael) and Mike Feuer (D-Los Angeles) authored the legislation, which would allow the commissioner to reject excessive rate hikes.
Since 2002, California health insurance premiums have increased by 134%, which is more than five times the overall inflation rate, according to a December 2010 report from the California HealthCare Foundation. CHCF publishes California Healthline.
State law requires health insurance rate increases to undergo review by an independent actuary. In addition, the federal health reform law mandates that at least 80% of premiums must be spent on medical care.
Support, Opposition to Bill
Insurance Commissioner Dave Jones (D) and Sen. Dianne Feinstein (D-Calif.) support AB 52.
Similar bills have failed in the Legislature in 2008, 2009 and 2010 under pressure from health insurers (Kovner, Santa Rosa Press Democrat, 4/10).
Editorial, Opinion Piece
An editorial and an opinion piece recently weighed in on AB 52. Summaries are provided below.
- A Sacramento Bee editorial states, "Action is needed at the state and federal levels" to regulate health insurance rates. The editorial adds, "Consumers deserve better than sporadic action that ultimately relies on the whim of the insurer" (Sacramento Bee, 4/10).
- In a San Jose Mercury News opinion piece, Patrick Johnston -- president and CEO of the California Association of Health Plans -- writes, "AB 52 will hurt patients, hospitals and doctors by placing costly price controls on insurance premiums." Johnston adds that the bill "will force health plans to reduce payments to hospitals, doctors and medical providers, harming patients and the health care system that serves them" (Johnston, San Jose Mercury News, 4/10).