CA bill requires permission for cancellations

A California legislator has introduced a bill which would require health insurers to get permission before they retroactively cancel one of their beneficiaries' coverage. Under the terms of the bill, health plans would need to get prior approval from the state's tough Department of Managed Health Care before canceling or rescinding a member's policy. The filing follows a firestorm of controversy over letters issued by Blue Cross of California, which asked doctors to search out and report any conditions which might disqualify patients from coverage. (A day after the story broke, Blue Cross stopped sending the letters, but the PR damage was done.)

The bill builds on a related law sponsored by this one's backer, Assemblyman Hector De La Torre (D). De La Torre previously sponsored a measure which requires insurers to pay providers once they authorize treatment--even if the policy is retroactively canceled. That bill was approved, and went into effect Jan. 1.

To learn more about the bill:
- read this San Francisco Chronicle piece

Related Articles:
PacifiCare faces $1.33B fine. Report
BC of California fined $1 million for cancellations. Report
HealthNet fined $1M for non-disclosure of cancellation bonuses. Report

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