Concerns Raised About Bill on Health Insurance Rescissions
The California Senate Health Committee today will discuss a bill intended to limit health care policy rescissions, but some attorneys warn that the measure also could restrict when patients can take their insurers to court, the Los Angeles Daily Journal reports.
The bill (AB 1945) by Assembly member Hector De La Torre (D-Los Angeles) would require health plans to seek approval from the state to rescind a health insurance policy. It would require appeals of rescission decisions to be handled by a third-party review panel hired by state regulators.
Sharon Arkin, a Los Angeles attorney, said that the legislation "will lead to many more rescissions and will essentially provide legal immunity to health plans when they rescind."
The Consumer Attorneys of California, a group of 3,000 plaintiff attorneys statewide, opposes the bill and sent a letter to De La Torre last week raising concerns. The letter stated that private review organizations will not be able to determine if a rescission was proper because they would have limited ability to gather information.
Legal observers also said that the measure would give state regulators wider oversight of contract law, an area that typically is the realm of courts.
Consumer advocates also have voiced concerns that amendments to the bill make it more beneficial to insurers (George, Los Angeles Daily Journal, 6/18).