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California insurance commissioner to enforce 80 percent MLR

California Insurance Commissioner Dave Jones now has authority to enforce a new federal rule requiring health insurers to spend at least 80 percent of premiums on medical care, reports the Sacramento Bee.

The state's Office of Administrative Law approved the emergency regulation granting Jones the authority to enforce the 80 percent medical-loss ratio in California, even if Congress prevents HHS from putting that ratio into effect, according to the National Underwriter. Previously, state regulators were limited to enforcing a 70 percent medical-loss ratio. The changes basically make California law consistent with the new federal law, notes the San Francisco Business Times.

The authorization comes after the new commissioner has clashed with Blue Shield of California and Anthem Blue Cross over their recent premium rate hikes for individual policyholders.

"I will be watching very closely to make sure health insurers comply," Jones said in a statement.

The emergency regulation "doesn't change policy, but there's now a cop on the beat," Anthony Wright, executive director of Health Access California, told the Bee.

To learn more:
- read the Sacramento Bee article
- see the National Underwriter story
- view the San Francisco Business Times piece
- check out the California Department of Insurance statement

Related Articles:
New MLR rule requires payers to cut overhead costs
SPOTLIGHT: Insurance commissioners approve 2010 medical loss ratio form
Florida wants waiver from medical-loss ratio law

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