California State Representative Liz Ortega has announced a legislative initiative aimed at increasing transparency in the health insurance sector. This move is backed enthusiastically by the California Nurses Association and seeks to address the frequent denial of insurance claims, an issue impacting one in five claims nationwide according to the Kaiser Family Foundation.
In support of this initiative, the California Nurses Association stated, “The new bill would mandate public reporting on the denials of insurance claims for California’s patients, something nurses believe can expose the broken trust between insurers and patients at the root of our broken health care system.”
Union President Michelle Gutierrez Vo, RN, emphasized the importance of this bill, saying, “Insurance companies see our patients as numbers on a spreadsheet, but they’re real people to us as nurses at their bedsides. Having publicly available information on why insurers deny claims is a major move to expose how health care is systematically denied to our patients.”
Ortega explained the necessity of this legislation, noting, “Millions of Californians are paying high monthly premiums for their health insurance, only to find that when they get sick and need it, their claims are denied. Statistics on health insurance denials are not made public… If you’re forced to seek care out-of-network, you have nearly a 50/50 chance of having your claim denied.”
The proposed bill would require California insurers to report detailed information on claims denial rates to state departments, categorizing them by network status and specific denial reasons.
“This information will be especially relevant for denied claims for timely, life-saving care,” according to the California Nurses Association. They added, “While California prides itself on a low uninsured rate, CNA nurses support AB682 to expose how health care plans are deliberately underinsuring customers.”
The bill highlights a broader issue of national concern, as illustrated by a report from the Kaiser Foundation, which noted a 19% denial rate for in-network claims in 2023. The complexity of the denial process remains a significant challenge post-Affordable Care Act, particularly with the exposure of United Health Care’s high denial rate.
This legislative effort marks a significant step toward providing the public with the information needed to understand and potentially contest insurance denials, although its impact is currently limited to California.
