Assemblymember Mike Feuer’s attempt to regulate health insurance rates must wait until the second installment of the two-year session.

State Assemblymember Mike Feuer (left), held a press conference in January with Insurance Commissioner David Jones to announce his plans for legislation restricting insurance rate hikes. (photo by Edwin Folven)

Feuer (42nd District) announced recently that Assembly Bill 52, which sought to have insurance companies files for any rate changes with either the department of insurance or the department of managed healthcare, hit a “temporary roadblock” in the Senate.

“Right now, not enough senators are prepared to vote for any form of health insurance rate regulation,” he said in a press release. “Until a majority of the Senate supports giving the state authority to reject excessive health insurance increases, millions of Californians will continue to pay unreasonable rates or not be able to afford to go to the doctor at all.”

Spokesperson Arianna Smith of Feuer’s office said that the bill called for insurance companies to file an application with either department 60 days in advance of any rate increase. During that time, the departments could opt to reject or modify the application if the increase is too sharp or if an increase or decrease threatened the solvency of the company, she said.

Smith said the bill was proposed mostly to protect individual and family markets, which are generally the most at-risk for high rate increases. She said the state has seen rate increase proposals for as high as 86 percent for certain individuals and families. The bill, though, would have protections for groups as well.

“These rate increases are really, really significant for both individuals and small businesses,” Smith said.

AB 52 would give the insurance department, which handles mostly individual and small group insurance, and the managed healthcare department, which primarily deals with larger groups, an enforcement mechanism. Currently, the departments can only declare that the increase or decrease is unreasonable through the recently-created rate review system, Smith said.

“We’ve been able to see that it’s not enough,” she said. “There’s an added urgency.”

However, the bill would come at a cost. Smith said the insurance department would only need to add a few staff members, but the department of managed healthcare would need several new employees. That cost, though, would be charged to the insurance companies, she said.

Smith said Feuer and other legislators have been working to impose stricter regulations on insurance companies for several years. Last year, Feuer jointly-authored such a bill, but it died on the Senate floor, she said.

This year’s bill made it to the Senate floor, but Feuer pulled it when it became obvious it didn’t have enough support, Smith said. In January, the bill will begin on the Senate floor, where it left off.

“We’re going to be starting there next year,” Smith said. “We’re very close to the end.”