California Measure Aims To Tighten Rules on Insurance Cancellations
On Wednesday, Assembly member Hector De La Torre (D-South Gate) introduced legislation (AB 1945) that would require insurers to receive permission from the Department of Managed Health Care before canceling a member's health insurance coverage, the San Francisco Chronicle reports (Colliver, San Francisco Chronicle, 2/14).
The proposed measure was introduced the same week that the Los Angeles Times reported that Blue Cross of California was sending physicians copies of new patients' health insurance applications along with a letter advising them to immediately report any "condition not listed on the application that is discovered to be pre-existing."
After criticism mounted, Blue Cross decided to discontinue the letters (California Healthline, 2/13).
De La Torre said the letters "asking doctors to rat out their patients epitomized the depths to which an insurance company will sink to cancel policies."
Chris Ohman, CEO of the California Association of Health Plans, said the group has not yet analyzed the measure but maintained that rescinding coverage is appropriate in some cases in order to prevent fraud.
Nick Garcia, spokesperson for Blue Cross, said the insurer is currently evaluating the provisions of the bill. He added that Blue Cross looks forward to working with De La Torre "on this important piece of legislation to protect consumers" (San Francisco Chronicle, 2/14).