California would regulate the cost of healthcare services under new proposed legislation

A bill introduced in the California Assembly Monday seeks to give the state more control over healthcare costs. (Makaristos/Wikipedia)

One lawmaker in California has a solution to drive down the cost of care: Regulate it.

A bill introduced in the California Assembly Monday seeks to give the state more control over how much doctor’s visits and hospital stays cost.

The bill aims to bring individual held and employer-sponsored private health insurance plans closer in line with Medicare’s rate for a healthcare service or procedure. These prices would be set by an independent commission—a nine-member state entity appointed by the governor and state legislators. Hospitals or providers would be able to contest the prices and argue case-by-case for an increased rate.


2019 Drug Pricing and Reimbursement Stakeholder Summit

Given federal and state pricing requirements arising, press releases from industry leading pharma companies, and the new Drug Transparency Act, it is important to stay ahead of news headlines and anticipated requirements in order to hit company profit targets, maintain value to patients and promote strong, multi-beneficial relationships with manufacturers, providers, payers, and all other stakeholders within the pricing landscape. This conference will provide a platform to encourage a dialogue among such stakeholders in the pricing and reimbursement space so that they can receive a current state of the union regarding regulatory changes while providing actionable insights in anticipation of the future.

While rising healthcare costs are a nationwide issue, California's average monthly premium increases have been significantly higher than the national average, according to the California Health Care Foundation. From 2002 to 2016, family premiums saw a cumulative increase of 234%, according to the group.

RELATED: Could employer-based insurance be headed for the unemployment line?

During a press conference to unveil Assembly Bill 3087, the bill’s sponsor Assemblyman Ash Kalra, a freshman Democrat from San Jose, said because the pricing will be built upon the existing Medicare model the state can establish a transparent process that leads to more reasonable rate increases moving forward.

The idea has already drawn the ire of insurance companies and providers. California Medical Association President Theodore M. Mazer came out against the proposal in a statement, saying the policy would threaten to “reverse the historic gains for health coverage and access” that resulted from the passage of the Affordable Care Act.

The bill could spur something of a lobbying faceoff, as support on the other side is led by consumer groups and some influential unions. During the bill’s unveiling in Sacramento Monday, Kalra was joined by members of the Service Employees International Union, the Teamsters and Unite Here.

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