Calif., R.I., move to strengthen review of health insurance rates; Ind. weighs changes in state employee health plans

The Los Angeles Times' Blog: "Gov. Arnold Schwarzenegger moved Wednesday to implement a major element of the new national healthcare overhaul, seeking a $1-million federal grant to strengthen the state's review of health insurance rates. Much of the money would pay for actuaries to evaluate premium hikes sought by insurers. ... The healthcare law requires states and the federal government to establish a process to review 'unreasonable' rate increases. The definition of 'unreasonable' is still being developed, but the law provides grants to states to begin the evaluations" (Helfand, 7/7).

The Indianapolis Star: "Schools, universities and the state would save $454 million annually if all were on the same health insurance plan, according to a study delivered Wednesday to the State Budget Committee. ... But much of those savings would come in the form of higher premiums or deductibles paid by school and university employees, or because the insurance offers less generous benefits than some schools currently provide. That's a choice school officials say should be up to local school boards, not legislators" (Schneider, 7/8).

The Providence (R.I.) Journal: "On Wednesday, state Health Insurance Commissioner Christopher F. Koller, in approving rate increases, took the unusual step of inserting his office between insurers and hospitals to influence what is spent on medical services. Some of the changes are dramatic and embrace ideas often espoused in discussions of health-care reform. Hospital officials reacted warily. ... Insurers negotiate contracts that set how much they must pay hospitals for medical services provided to subscribers. But next year, the contracts will have to comply with six conditions established by Koller" (Salit, 7/8). 

St. Augustine (Fla.) Record: "Attorney General Bill McCollum and Agency for Health Care Administration Secretary Tom Arnold said Wednesday that they have reached a verbal understanding with the federal government to revamp the way the state investigates Medicaid fraud by letting prosecutors have access to data currently only available to AHCA, which administers the program." They are waiting for the Department of Health and Human Services to approve this action. "Florida is one of many states that has been struggling to combat Medicaid fraud. The state Office of Program Policy Analysis and Government Accountability estimates that abuse of the program may account for about $3.2 billion of the state's $16 billion Medicaid budget" (Haughney, 7/8). 

Sunshine State News: "The waivers would make the Attorney General's Office the first agency in the nation not directly related to Medicaid to have access to Medicaid files" (Tiegen, 7/7).

The Wall Street Journal: "Skilled Healthcare Inc. faces payments of over $671 million in damages awarded by a California jury in a more than four-year-old lawsuit over alleged violations at 22 of its nursing facilities. Shares fell 76% to $1.52 in New York Stock Exchange. ... The jury said the company violated the California health and safety code that mandates that nursing homes maintain 3.2 nursing hours per patient per day" (Stynes, 7/7).

The Los Angeles Times reports on the same case and notes that the jury still is considering punitive damages against the company. "The verdict against the Foothill Ranch company came in Humboldt County Superior Court in a class-action lawsuit brought by patients and family members.  … The company said in a statement it will appeal. 'We strongly disagree with the outcome of this legal matter, and we intend to vigorously challenge it.' ... The suit only applies to assisted-living facilities operated by the company in California" (Olivarez-Giles, 7/8).

The Los Angeles Times: "California's cash crop could become dirt cheap if the state legalizes marijuana. Researchers associated with the Rand Corp.'s Drug Policy Research Center said Wednesday that not much is certain about the potential impact of Proposition 19 except that the price of California's choicest weed could plunge more than 80%, down from $300 to $450 per ounce to about $38. … The implications of such a drop would be profound. ... Such a low price could also affect pot prices across the nation, encourage marijuana tourism in the state, increase the amount of pot shipped out of state, disrupt the smuggling of marijuana from Mexico and stimulate an underground market designed to avoid high taxes that might be imposed" (Hoeffel, 7/8).

Hudson Valley Press: The New York legislature has amended the state's insurance law "to provide coverage for the screening, diagnosis and treatment of autism spectrum disorders," according to New York State Senator Thomas P. Morahan, chairman of the Senate Committee on Mental Health and Developmental Disabilities. (7/7).