Health care bills faced uphill fight

Less than a year after the disintegration of Assemblyman Fabian Nunez’s plan to expand health care coverage to thousands of uninsured Californians, lawmakers tried to pick up the pieces on health care reform this session.

The results, like those in much of the legislative session, were decidedly mixed. The Legislature passed a bill by Assemblyman Hector De La Torre, D-South Gate, that would set standards for health plans before they rescind coverage for customers, over some strong opposition from health plans. The bill faces an uncertain future at the hand of Gov. Schwarzenegger.

Other bills passed this year include a bill by Sen. Sheila Kuehl that would force health plans to spend at least 85 percent of premiums on health care benefits, and a restructuring of the Major Risk Medical Program.

There were also some closely watched bills that met their demise in the closing days of session. A bill by Sen. Darrell Steinberg, D-Sacramento, that would have standardized health care options for individual health insurance plans collapsed on the Assembly floor. Meanwhile, the Senate held up a labor-backed proposal by Assemblywoman Sally Lieber, D-Mountain View, that would have required a new class of health care data and information records.

Now, the focus turns to Schwarzenegger. Among the 850 bills that should eventually find their way to the governor’s desk are this year’s big-ticket health care items, many of which passed after acrimonious debate, heavy lobbying, and in many cases, party-line votes.

What follows is a review of some of the biggest health care bills from the 2008 legislative year.   


AB 1945 – (De La Torre)

Rescission — This was one of the most controversial health care bills of the legislative session. The bill creates new standards for health plans, outlining specific steps they must take before opting to rescind a customer’s health care coverage. The bill also mandates health insurers to perform medical underwriting – reviewing a patient’s past medical history – before they offer health care coverage to an individual.

The bill almost died on the Assembly floor in the closing days of session, as a team of Democrats, led by Kevin De Leon, D-Los Angeles, Mary Hayashi, D-Castro Valley, and former Speaker Fabian Nunez, D-Los Angeles, pulled their support for the bill. The measure was stuck with 31 votes, and placed on call.

De La Torre then turned to Republicans, many of whom had supported the measure in the past, and convinced enough of them to support the bill. Once it became clear De La Torre had the votes to get the bill off the Assembly floor, De Leon et. al. scrambled to vote for the bill.

In the end, the measure received 55 yes votes, and now moves on to the governor’s desk.

AB 1962 (De La Torre)

Maternity benefits —  Requires health plans to include maternity benefits for individual health insurance plans. Under state law, health maintenance organizations are already required to provide these benefits. This bill would extend that mandate to individual health plans, most of which are regulated by the state Department of Insurance.

Unlike most other coverage mandate bills, this measure was not opposed by the powerful California Association of Health Plans, since their members are already required to provide the coverage, and this bill did not place any new coverage mandates on HMOs.

SB 1440 (Keuhl)

Medical loss ratio — This bill requires health plans to spend at least 85 percent of the money they collect from health insurance premiums on health care benefits for their customers. Health plans were able to introduce amendments in the Assembly that allow the percentage to be calculated over an average of all of the various products they offer to customers. Critics say that amounts to a watering down of the bill, and that some customers will continue to overpay for health insurance, while health insurance providers will be able to maintain high profit margins.

AB 2 – (Dymally)

MRMIP reform — This bill creates a new fee on individual health care policies that will be used to subsidize coverage for people deemed “medically uninsurable.” If health plans want to opt out of being forced to cover these people, who are considered the most expensive to insure, they must pay a fee of up to $1 for every customer they have.

SB 981 (Perata)

Balance Billing – This bill would forbid emergency room doctors from billing patients directly when their HMOs refuse to cover specific procedures. This bill was strongly opposed by doctors, who argue they will be left paying the cost when HMOs fail to cover medical bills. The bill cleared the Senate by the bare-minimum 21 votes, with two Democrats voting against the bill.  


SB 1522 (Steinberg)

Health plan standardization — This bill would have required the two agencies that regulate health care plans — the Department of Managed Care and the Department of Insurance — to standardize individual health care plans. The bill went down to defeat on the Assembly floor, and the final vote tally was eventually expunged from the public record.

AB 2967 (Lieber)

Health-care data reporting –Would have created two new state bureaucracies focused on improving the collection and reporting of medical data. The bill was supported by labor and patient advocate groups, and opposed by health plans, doctors and hospitals.
This bill got out of the Assembly with just 41 votes, but died on the Senate floor.

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