Legislative News
10/10/2008
* The California governor vetoed a bill requiring state review before health insurers could deny or rescind coverage. AB 1945 was one of several bills considered in California this year after the insurance department cracked down on a number of health insurers for unfairly canceling or limiting coverage. But the governor did sign AB 1150 earlier this year. That law prohibits health insurers from rewarding employees for limiting coverage.
* Michigan’s legislature appears to be ending the year without debating several high-profile auto insurance fraud issues. Given the short timeframe and a lame-duck session, there’s little chance of passing an anti-runner bill or creating an insurance fraud prevention authority, a policy staffer of a senior legislator told the coalition. But both issues and possibly other auto fraud concerns likely will be on the 2009 agenda, the staffer says.
Note: Texts of anti-fraud bills are available on the coalition's website here.
10/03/2008
* In a surprise move, New Jersey Governor Jon Corzine conditionally vetoed a bill giving the office of insurance fraud prosecutor a larger role in investigating and prosecuting workers comp premium schemes. Corzine wants to clarify SB 1918 with “a small number of technical amendments to ensure that this measure is not construed to limit or impede the conduct of criminal investigations and prosecutions by (other) prosecutorial agencies of the State." It’s unclear if the legislature will make the changes.
* The California governor vetoed a bill that would’ve effectively banned so-called STOLI transactions. A dozen states already have passed similar bills covering so-called Stranger Originated Life Insurance arrangements. Supporters of SB 1543 included life insurers, agents and brokers, consumer groups and members of the life settlement industry. Passage would’ve protected senior citizens from exposure to STOLI fraud, the bill’s supporters argue. Both chambers of the legislature had overwhelmingly approved the bill. Gov. Schwarzenneger stated that he supports the goals of the legislation but felt that the bill as passed lacked proper notification and disclosure of life settlement transactions to consumers.
Note: Texts of anti-fraud bills are available on the coalition's website here.
09/26/2008
* The California legislature passed a bill requiring auto body shops to provide insurers and consumers, upon request, copies of all invoices of replacement parts installed to repair damaged vehicles. Existing law already makes it a crime to switch parts (charging insurer or consumers full retail price for a used or cheaper part). AB 2825 would let insurers and consumers examine more closely if a repair shop has illegally swapped parts. The crime would be a misdemeanor, with a possible six-month sentence and fine of up to $1,000. Several consumer groups urged the governor to sign the bill, the prosecutors say.
* The California Fraud Assessment Commission has inked a 2 1/2-percent funding increase to encourage county prosecutors to take on workers comp and other insurance schemes. But state prosecutors had sought 12 percent, which was slashed due to the state’s ongoing budget crisis. This could seriously undercut the prosecutors’ ability to pursue insurance fraud cases.
09/19/2008
* A blue ribbon panel has been set up to review insurance regulations in New York, and the insurance department is asking the anti-fraud community to suggest fraud requirements to review. One regulation up for change is the section within Regulation 95 requiring insurers to sponsor public outreach programs. Some insurers would like to see the regulation tightened and clarified to make sure more insurers are fulfilling their responsibilities under the law.
09/12/2008
* Fraud fighters in several states already are focusing on the 2009 legislative session. The Texas Committee on Insurance Fraud wants to target recruiters for staged-accident rings and require that only licensed chiros can own chiro clinics. In Indiana, there’s a movement afoot to create an insurance fraud bureau. Several auto-fraud initiatives could surface in Michigan, including an anti-runner law and the creation of an automobile insurance fraud prevention authority. Lawmakers in Ohio and Connecticut may move to limit outsider access to auto accident reports; this would make it harder for rings to identify and recruit accident victims into fake-injury schemes. Savvy fraud fighters are using this fall season to plan their agendas so they’re ready to move when the doors open in 2009. The coalition’s legislative chief Howard Goldblatt is glad to offer counsel on fraud bills and legislative strategy. Contact Howard at 202-393-7332 or howard@InsuranceFraud.org.
