Assembly Health Committee Passes Medical Fraud Bill

The Assembly Health Committee on Tuesday voted to approve a bill (AB 2354) that would strengthen laws against medical discount card programs not offered by health plans that are marketed to uninsured residents by promising savings on health services for a monthly fee, the Stockton Record reports (Goldeen, Stockton Record, 5/6). The original bill, sponsored by Assembly member Lloyd Levine (D-Van Nuys), would have banned medical discount card programs because they violate a state law that prohibits the referral of patients to any health care provider for a profit (California Healthline, 5/4). However, the bill was amended to expand existing law regarding medical referrals and exempt certain group advertising and referral services already approved for chiropractors, dentists and family and marriage therapists. Levine said that writing the final provisions for the measure to ensure that the bill has "some teeth and provides consumers with clear guidelines to protect themselves and seek remedies through the court system won't be easy." Earl Lui, senior attorney for the Consumer's Union West Coast regional office, said, "There's no regulation of these things. No one is making sure they provide any benefit to consumers." However, at Tuesday's hearing, advocates for discount-benefit programs, who opposed the original bill, said that while some regulation is needed, there are legitimate companies that offer "real benefits in terms of lowering the cost of health care," particularly for the state's uninsured population. The Assembly Appropriations Committee will hold a hearing on the bill in the next two weeks, according to the Record (Stockton Record, 5/6).