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California Governor Signs Health Care Protection Bill

Ruzanna Harutyunyan's picture

California Governor Arnold Schwarzenegger signed AB 1150 by Assemblymember Ted Lieu (D-Torrance) which bans health insurance companies from rewarding their employees for canceling or limiting a patient's health insurance. While the Governor signed AB 1150 because of the urgent need to protect consumers from unfair health care rescissions, he continues to believe that health care reform must be comprehensive.

To that end, he has proposed legislation that would be the building blocks of comprehensive health care reform and is working with the legislature on a joint solution that will protect consumers, control costs and promote prevention.

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"Until we achieve comprehensive health care reform, stopping unfair health care rescissions is an urgently needed consumer protection," Governor Schwarzenegger said. "This terrible practice further illustrates the erosion of our health care system and the need for comprehensive health care reform. Today we are standing up for consumers by putting an end to a deplorable practice, and I will continue working with my partners in the legislature to stop unfair health care rescissions once and for all."

The Governor's goal of comprehensive health care reform would make health care rescissions a problem of the past. The Governor's AB x1 1, the Health Care Security and Reduction Act, would have required that all Californians take responsibility for their health coverage while guaranteeing that no Californian is turned away from buying insurance based on their age or medical history.

To increase consumer protections, the Governor's legislative proposal on rescission includes stronger upfront requirements for health plans before they issue coverage to individuals, protects patients from being rescinded if their doctor never told them about a medical condition that affects their ability to obtain coverage and provides for an independent third-party review when a health plan seeks to rescind or cancel an enrollee's coverage.

As part of the Governor's commitment to covering Californians and stopping unfair health care rescissions, his Department of Managed Health Care (DMHC) has reached groundbreaking agreements with all of California's major health plans over the last few months where they've agreed to reinstate coverage to California consumers whose health care coverage had been rescinded. Last week, DMHC fined Anthem Blue Cross $10 million, which is the largest fine ever reported to be collected against an individual health insurer in the nation.