Court Paves the Way for Local Officials To Fight Health Plan Rescissions
California cities and counties soon could begin combating health plan rescissions and other insurance practices after an appellate court ruled that local prosecutors have the authority to sue health insurers, the Los Angeles Times reports.
In 2008, the Los Angeles city attorney's office filed a lawsuit accusing Anthem Blue Cross of California of violating state regulations that prohibit insurers from revoking coverage after members submit claims.
Blue Cross argued that the case was invalid because the state Department of Managed Health Care has jurisdiction over insurer practices.
However, last month the state Court of Appeal in Los Angeles ruled that state law authorizes local attorneys to sue health insurers over actions that affect consumers.
Some local officials praised the court decision for inviting greater scrutiny of the state's health insurance industry.
However, DMHC noted that local prosecution could create duplicative regulation and drive up health care costs.Blue Cross officials said they are weighing whether to appeal the court decision (Girion, Los Angeles Times, 1/2). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.