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New Health Care Legislation Stops 'Opportunistic' Insurance Pricing
Date:3/5/2009

LOS ANGELES, March 5 /PRNewswire/ -- With the nation focused on health care reform, California Assemblyman Paul Cook (R-Yucca Valley) recently announced Assembly Bill 562 (AB 562), legislation aimed squarely at providing relief to businesses and consumers that have fallen victim to price gouging across the state. AB 562 decreases health care premium costs. It requires insurance companies to provide greater amounts of "loss experience" information to mid-sized companies, allowing them to bargain fairly with the insurance industry.

"AB 562 will give employers a more level playing field in negotiating rates with insurance companies, which will quickly drive down premiums at a critical time in our state's history," said Jeff Miles, national health care analyst and President of The Miles Organization. "Lower employer rates will mean lower employee contributions, saving millions of Californians on their health costs. Creating greater competition in the private marketplace will attract more insurance plans into California, thereby providing much-needed relief."

According to Dr. John Schneider, a principal at the independent research group Health Economics Consulting Group, this legislation represents an estimated $16 billion of savings to California's businesses and their employees. AB 562 keeps the private health care delivery system in place and will not interfere with the doctor/patient relationship. It strengthens the employer-based system by lowering premiums, and will support the existing system by increasing the number of Californians covered by their employers.

AB 562 helps both small and mid-sized employers save money. For employers who are in the small group (2-50) markets, the bill will help them to negotiate their Risk Adjustment Factors (RAF), or to choose other options that better suit their employees. For mid-sized employers (51+)
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SOURCE The Miles Organization, Inc.
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