California governor signs law banning insurers from rewarding employees for canceling, limiting patient coverage

Governor Schwarzenegger proved that he IS BACK.  This is a great bill and just one step needed in the right direction.  All barriers to purchasing and maintaining private health insurance need to be removed if a private health insurance industry is to survive.  That the states have to take this action, one at a time, instead of the federal government banning this and other onerous practices by health insurers is unfortunate. However, the history of our multi-state republic is that it is the states that often lead the way for Washington DC to follow.  See the excerpt and link to the LA Times article below.  Keep it up Governor! . . . jomaxx

“Gov. Arnold Schwarzenegger (R) signed into law Tuesday a ban against health insurance companies rewarding employees with bonuses for canceling or limiting a patient’s coverage.” The measure is an attempt “to curtail the practice that the industry has defended as a little-used guard against fraud that helps control costs.” Insurance industry “[c]ritics contend that insurers use confusing applications for individual policies to trap people into making mistakes that can later be used against them.” Then, “[w]hen a policyholder gets sick, they say, insurers scour old medical records looking for an undisclosed condition or symptom to use to justify cancellation.” Assemblyman Ted Lieu (D) introduced the rescission legislation “after the Times disclosed that…insurer Health Net paid bonuses to an employee in charge of canceling coverage based, in some years, partly on how many policies she canceled.”