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$1 Million to CA for Insurance Oversight

This week, the Department of Health and Human Services announced that it is distributing $46 million in grants to 45 states (including California) and Washington, D.C., to help improve and expand their ability to enforce new health insurance industry regulations included in the federal health reform law. The grants are also intended to help expand public access to information about rate hikes and to hire experts to review what insurers want to charge.

In particular, these grants will assist states in enforcing federal health reform included myriad provisions that restrict or prohibit various insurance business practices. Some of the restrictions that take affect this year include:

• Providing health coverage to children younger than age 19 regardless of pre-existing medical conditions;

• Allowing dependents up to age 26 to remain on their parents’ health policies; and

• Stopping charging consumers higher co-payments for preventive services, imposing lifetime limits on benefits, denying benefits, or rescinding coverage during treatment.

There is some controversy involving California’s grant. Some states have what is called “prior approval” authority — the power to review insurance company records and stop proposed rate increases in the individual and small-group markets. The Schwarzenegger Administration refused to include prior approval in the California request. Our state nonetheless received its $1,000,000 grant, which will be used mostly to streamline collection of data on proposed rate hikes.

For more, see today’s L.A. Times and California Healthline.