California Assemblyman Mike Feuer (D-Los Angeles) pulled his insurance rate regulation bill, AB 52, on Wednesday before a state Senate vote stating there were not enough Democratic Senators lined up to pass the measure.
The death of the bill, which was the most recent attempt in California to give the state's insurance commissioner power to reject proposed health insurance premium increases, is a bitter setback for consumer advocates and Insurance Commissioner Dave Jones, who pushed for similar legislation three times.
The legislation seemed to have a better chance of passing this year than in the past due to a handful of highly publicized rate increase proposals from two of the state's largest insurers, Anthem Blue Cross and Blue Shield of California. (Blue Shield later backed off its rate request.)
[See also: California Assembly passes bill to allow state regulation of health insurance rates; Blue Shield of California backs off proposed rate increases]
Problems surfaced in the Senate Committee meetings as some Democrats objected to specific provisions of the bill and those objections, even as work on amendments to the bill were in process, ultimately sank its chance of passage.
"Right now, not enough senators are prepared to vote for any form of health insurance rate regulation," Feuer said in a statement after pulling the bill, but he also vowed to bring the bill back up for consideration.
"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," Feuer added.
With the Senate the last hurdle to passage, a broad swath of groups and organizations representing the insurance industry, hospitals, doctors and others lobbied to defeat the measure. Even if it had passed in the Senate, published reports have indicated uncertainty about whether Gov. Jerry Brown would sign AB52 into law amid concerns from his administration that the law could potentially add millions to the state budget in order to conduct the necessary reviews of rate filings.
"AB 52 hit a major roadblock because it was deeply flawed," said Patrick Johnston, president of the California Association of Health Plans, in a statement. "Diverse interest, including doctors, hospitals, business, government, agriculture and many others, joined together to defeat AB 52 because rate regulation is bad policy. AB 52 failed to address the underlying cost pressures that are driving up the price of coverage. Those root causes must be addressed to really tackle health care affordability."
Consumer advocates weren't so quick to put the onus on rising premiums solely on the backs of rising healthcare costs.
"Californians are paying way too much for health insurance because insurance companies are unaccountable in this state," said Doug Heller, executive director of Consumer Watchdog in a Los Angeles Times report. "It just shows the level of influence insurance companies have in Sacramento."
For its part, the Santa Monica, Calif.-based consumer advocacy organization, Heller, may not be willing to wait on legislative action to rectify what it sees as a flaw in governance, as the group recently announced its intentions to attempt to bring the issue directly to California voters via a state ballot measure next year.