Poizner Unveils Rules To Prevent Health Insurers From Rescinding Policies
Today, California Insurance Commissioner Steve Poizner (R) is scheduled to release draft regulations aimed at limiting the circumstances under which health insurance companies can rescind patients' individual insurance policies, the Los Angeles Times reports.
Poizner's proposal would require insurers to use clear language in coverage applications and allow applicants to answer "not sure" for questions about their medical history.
The regulations also would prevent insurers from revoking a policy if the company did not fully investigate an applicant's medical history before providing coverage. Furthermore, companies could not rescind plans if an individual was unaware of the medical information being sought on an application.
Poizner plans to hold a public hearing on the proposal in San Francisco on July 20 and could revise his regulations in response to testimony or written comments. The commissioner is expected to issue final rules in the fall.
Consumer groups say the regulations would protect individuals from coverage rescissions over innocent errors and omissions. Insurance companies say they are reviewing the plan.
The regulations would pertain to individual insurance policies marketed by Anthem Blue Cross Life & Health, Blue Shield Life & Health, Health Net and other companies licensed by the Department of Insurance.
Department of Managed Health Care
California's other insurance regulator, the Department of Managed Health Care, oversees all state HMO plans and some PPO policies.
On Tuesday, the department said it is not writing its own rescission regulations. Instead, the agency will operate according to agreements reached with five of California's largest insurers, including Anthem Blue Cross, Blue Shield of California and Kaiser Permanente.
In related news, the California Assembly is expected to vote soon on a bill (AB 2) by Hector De La Torre (D-South Gate), which also aims to curb policy rescissions.
The legislation would prohibit insurers from revoking coverage unless the company could demonstrate that an applicant purposefully misrepresented medical information. The bill also would require insurers to clarify their applications.
Gov. Arnold Schwarzenegger (R) has not indicated his stance on the bill, but he vetoed a similar measure last year (Girion, Los Angeles Times, 6/3).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.