Is insurance across state lines a good idea for California?

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Residents who have opposed legislative efforts to overhaul the nation’s health care system have supported proposals that would allow insurance companies to sell policies across state lines, but some argue such plans would erode consumer protections.

Provisions in health care reform plans in both the House and the Senate would allow for the practice, but could inspire a “race to the bottom” for insurers, the Los Angeles Times reports.

Healthcare overhaul bills working their way through Congress could jeopardize laws in California and other states that require insurers to pay for treatments such as AIDS testing, second surgical opinions and reconstructive surgery for breast cancer patients.

What’s more, the federal legislation could make it virtually impossible for states to enforce other consumer protection laws, such as the right to appeal if an insurer denies coverage for a particular treatment.

Healthcare overhaul bills in both the Senate and the House would open the door to insurers selling policies across state lines — which some lawmakers fear could allow health plans to take advantage of the lenient rules in some jurisdictions while avoiding tougher enforcement regimes in places like California.

Read the full story here.

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Written by Zain Shauk

November 16, 2009 at 8:58 am

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