California regulators are one step closer to more authority over the state’s insurance industry

California Health Insurance CompaniesCalifornia lawmakers have been inching closer to passing new legislation that would give the state’s insurance regulators the authority to reject changes to health insurance premiums. On Wednesday, the proposal passed an important test and earned approval from the Senate Health Committee.

Earlier in the year, many Californian health insurers instituted steep rate hikes, much to the chagrin of Dave Jones, the state’s Insurance Commissioner. Jones led the protest against the insurers and petitioned each company to stymie its rate hikes. He has been adamant in the belief that if regulators were afforded more authority, such excessive rate hikes would have never been an issue.

The bill will ensure that insurers attain approval from state regulators before they can collect on money gained from new rates. If their rate proposals are deemed too high or in any way excessive, regulators will have the authority to reject the proposal outright. If proposals are not rejected, insurers will be tasked with supplying regulators with a justification for their rate increase.

Jones, as well as other supporters of the bill, was concerned that amendments would have been made to the legislation in its passing the Senate Health Committee. However, the bill passed without receiving any alterations.

Opponents of the bill – a group comprised chiefly of insurers – argue that higher rates are vital to keeping up with the soaring cost of medical care. They hold that despite the bill’s lofty goals, it will prove a hindrance to consumers in the long run.

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