Interstate Health Plans Could Transform Calif. Insurance Marketplace
California's health insurance landscape could undergo a major shift if final health care reform legislation includes provisions allowing insurers to sell policies across state lines, the San Jose Mercury News reports.
Currently, any insurer selling health plans in California must comply with the state's consumer protection laws.
Under one reform proposal, insurers could sell policies in multiple states as long as their benefits met minimum federal standards.
If California wanted to impose more rigorous protections, state lawmakers would need to pass new regulations. In addition, California might need to pay consumers or insurance companies to cover additional costs from any state-imposed protections.
Another proposal would allow California to join a multistate compact in which insurance companies would be governed only by the regulations of their home state.
Impact on California Insurers
Observers say an interstate insurance market likely would benefit California health plans owned by large national companies.
The proposals would allow Anthem Blue Cross, UnitedHealth Group and other firms to sell policies in numerous states while skirting California's stringent consumer protections.
However, the proposals also could bring in more competition for California-based health plans such as Kaiser Permanente (Zapler, San Jose Mercury News, 12/22).
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