San Francisco Chronicle by Judy Lin –
April 29, 2013:
State lawmakers sent Gov. Jerry Brown a pair of consumer protection bills Monday that prevent health insurance companies from discriminating against people with pre-existing conditions and limit how much more insurers can charge older residents.
The legislation updates California laws to match new rules under the federal Affordable Care Act and will give state agencies the power to enforce and regulate individual insurance rules.
The Assembly passed ABx1-2 on a 49-20 vote, while the Senate passed SBx1-2 on a 27-9 vote. The Assembly bill makes changes to the insurance code, while the Senate bill makes changes to the health and safety code.
The bills now go to the governor, who is expected to sign them. They were part of a special legislative session convened by Brown to implement national health care reforms in California.
The governor’s office did not immediately respond to a request for comment Monday.
Sen. Joel Anderson, R-Alpine, said he was reluctant to vote against the bill but fears it will drive up health premiums for many individuals who purchase their own insurance. He cited an actuarial report commissioned by Covered California that found that middle-income residents could see individual health premiums increase by an average of 30 percent.
“It pains me to oppose this because I know how hard everyone’s been working,” said Anderson, who voted no.
While premiums may go up for some people, many more will get better health coverage, said Sen. Ed Hernandez, D-Covina.
The bills include consumer protections such as guaranteeing coverage even with pre-existing conditions. Health insurers also will be limited in how much more they charge an older person with health problems compared to a younger, healthy person.
“What you won’t hear about is all those individuals who are close to Medicare age with pre-existing conditions or were priced out of the market in the past,” Hernandez said.
The bills also allow the state’s health exchange to establish 19 geographic regions for determining the price of individual premiums. They do not allow health insurance companies to consider tobacco use in determining premium rates for Californians.
The state is in the process of launching a new insurance marketplace and has committed to expanding the state’s Medicaid program for the poor to get more residents covered. But more work remains.
Brown, a Democrat, is still negotiating with members of his own party to expand Medicaid, known as Medi-Cal in California, for people who make up to 138 percent of the federal poverty level, or about $15,400 a year for an individual. The expansion is estimated to bring 1.2 million new enrollees by 2017.
The governor is trying to limit future state liabilities, but Democratic lawmakers say the benefits of expanding outweigh the costs.
Under the health overhaul, the federal government will pay the full cost of expanding the low-income health program for the first three years, and then gradually reduce payments to 90 percent starting in 2020. The state is responsible for the remainder of that cost.