On Thursday, the state Assembly has approved a new bill which will enable the state regulators to reject or modify excessive health insurance premium increases. The Author of the bill, Assemblyman, Mike Feuer, D-Los Angeles, said the new measure is necessary because rates for California’s individual policyholders have highly increased in recent years compared with the national average.

Health insurers, especially Blue Shield of California and Anthem Blue Cross have come under regulatory scrutiny after the approval of new bill because of its high rate increases. It has been found that the increase in rate was sometimes over 50% in less than a year.

Insurance Commissioner, Dave Jones has welcomed the approval of the bill and said that the need of health insurance is rising constantly but health insurance is becoming more unaffordable for Californians and businesses.

Health care providers fear regulation will lead to lower reimbursements for their services because of more stringent regulations.

Despite its approval, new bill has faced opposition from various associations. The California Association of Health Plans has argued that rate regulation will not address the real problem and will shoot up the costs.


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