Governor Signs Health Care Bill to Limit Insurers’ Overhead

CALPIRG

Sacramento, CA—Governor Brown signed a new health care bill into law that will require insurers to use a higher percentage of consumers’ premiums for actual health care costs.   If insurers fail to meet this target consumers will be eligible for an annual rebate. 

“Health care is a huge and growing cost for consumers and they expect their premium dollars to be going to actual health care, “ said Austin Price, Health Care Associate CALPIRG. “Now consumers know most of their money is going to their health care and not overhead, marketing, and executive salaries.” 

SB 51 will: 

–      Require 85% of premiums to go to actual care in the large group market

–      Require 80% of premiums to go to care in the individual and small       group markets

–      Requires insurers not meeting the target to provide an annual rebate to consumers

–      Prevent unreasonable lifetime or annual limits on benefits

“The rebate brings some much needed accountability, and helps make sure consumers are getting real value for their health care dollars,” said Price. 

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CALPIRG is a non-profit, non-partisan public interest advocacy organization. For more information, visit http://calpirg.org