Assembly approves bill to expand coverage for people with pre-existing conditions

June 14, 2010

California lawmakers have taken the first steps toward putting in place a part of the federal health reform designed to make it easier for people with previous medical conditions to buy insurance.

The Assembly on Monday passed AB 1887, by Assemblyman Mike Villines, which will make California eligible for about $760 million in federal money over the next three and a half years to manage an insurance pool for high-risk consumers and subsidize their coverage.

Starting in 2014, insurance companies will be required to offer coverage to everyone, regardless of pre-existing conditions.

The state already manages a pool that covers about 5,000 people who couldn’t find insurance any other way. But by some estimates, between 400,000 and 800,000 Californians may be in this predicament.

The federal money is expected to help cover 20,000 to 25,000 additional people, depending on how the program is structured.

The federal plan requires states to limit individual’s out of pocket costs to just under $6,000 per year. But many of the other details are left up to the states. A companion bill, SB 227, by Sen. Elaine Alquist, grants authority to a state board to set eligibility standards, premiums and cost sharing.

California’s current program helps consumers buy insurance through two private companies, Kaiser and Anthem Blue Cross. If those or other companies do not volunteer to participate in the expansion, the state is planning to hire an administrator to arrange for and pay for health services directly, according to an Assembly staff analysis of AB 1887.

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