As noted below, a similar bill last year was vetoed, although I don’t know what else might have been included with the bill. With healthcare reform on everybody’s mind, rescission is one of the hot issues being debated, not cancelling coverage when the patient needs the coverage and the care. This is the most cold hearted thing a carrier can do in my estimation after collecting premiums. BD
The California Medical Association (CMA) and the Los Angeles County Medical Association (LACMA) have filed an amicus brief supporting a lawsuit filed against Blue Cross of California for illegally cancelling patients' health insurance policies.
Last year, the Los Angeles City Attorney filed a lawsuit on behalf of the people of California against the insurer for false advertising and unfair business practices. The suit alleges that Blue Cross sold people false promises of coverage, while systematically cancelling policies after policyholders got sick and filed expensive claims. This practice is known as rescission.
Last year, CMA and De La Torre teamed up to pass similar legislation - AB 1945. Despite the bill's bipartisan support and Governor Schwarzenegger's criticism of the practice of rescission, the governor vetoed the legislation, leaving Californians exposed to this insidious practice.