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Yahoo
28-05-2025
- Business
- Yahoo
California Assembly Advances Bill to Expose Patients to Doctor Substance Abuse, Says Consumer Watchdog
SACRAMENTO, Calif., May 28, 2025 /PRNewswire/ -- A bill that will put patients at risk from doctors who continue practicing while abusing drugs or alcohol passed off the floor of the California State Assembly yesterday and moves on to the Senate. AB 408 by Assemblymember Berman and sponsored by the Medical Board of California, would create a secret drug and alcohol "diversion program" where the Board would send doctors who have substance abuse problems, instead of taking disciplinary action. AB 408 does not require disclosure to Medical Board enforcement staff, or consequences, for a doctor in the program that fails a drug test, skips a drug test, or otherwise violates the program. This silence about relapse by doctors who are actively treating patients is not limited to doctors who choose treatment voluntarily, as proponents claim. It applies to doctors sent to the program by the Board who would otherwise have faced discipline, including those found using substances at work, said Consumer Watchdog. "With AB 408 Assemblymembers and the Medical Board prioritize doctors' interests over keeping their patients safe. The bill would eliminate the Medical Board's responsibility to investigate and act if it refers a doctor to treatment and that doctor fails a drug test. That means patients will be harmed by doctors who relapse, just as they were in the last program that was shut down for putting patients at risk," said Consumer Watchdog executive director Carmen Balber. The Medical Board's prior diversion program was abolished after failing five state audits because doctors who entered the program could relapse with no consequences and patients were harmed. To prevent this from happening again, the Legislature passed oversight rules called the "Uniform Standards" and applied them to doctors in diversion programs. AB 408 exempts doctors from the law, eliminating oversight and accountability from the program. Consumer Watchdog has urged preserving those patient protections. Tina Minasian, an advocate for patient rights in California, suffers lifelong injuries inflicted by a substance-abusing surgeon who was a participant in the former confidential physician diversion program. She played a pivotal role in advocating for the closure of the prior failed Diversion Program, and enacting the Uniform Standards so any future program would better protect patients. "I can't believe that eighteen years later I have to take on this fight again on behalf of all Californians," stated Minasian. "We gained too many protections in the past fifteen years to give them up. I lost everything when I was harmed and cannot allow another Californian to endure what I did." The bill would allow doctors to seek treatment to avoid discipline even if they were impaired on the job. For example: A San Francisco doctor suspected of stealing drugs from her hospital was recently arrested after she was found passed out in an operating room shortly after she was scheduled to participate in a toddler's surgery. Under AB 408 the Board could send that doctor into diversion instead of the disciplinary investigation, treatment oversight and consequences for relapse that are all mandatory under current law. The bill does not require reporting of a positive drug test to the Board, so the doctor could continue treating patients while keeping diversion program violations secret and place patients in harm's way. Read Consumer Watchdog's opposition letters on AB 408 here and here. The History of the Medical Board and Physician Diversion The former confidential physician diversion program was subjected to a critical sunset review in 2007 after five failed audits by the state and a critical report from an Enforcement Monitor revealed significant failures in drug testing and oversight. In response, patients stepped forward to share their harrowing stories of harm and loss due to the negligence of doctors in the program. The Medical Board of California recognized the severity of these revelations and terminated the program in 2008. That same year, a pivotal hearing on the diversion program was convened at the state Capitol. The chair of the joint committee announced SB 1441, legislation designed to establish Uniform Standards for Substance-Abusing Health Care Professionals in California. Passed into law in 2008, SB 1441 was a vital step toward rectifying the failures of the previous diversion program. It empowered the Medical Board with essential tools to monitor substance-abusing licensees and enforce meaningful consequences for offending physicians, prioritizing the protection of patients and fostering a culture of accountability among healthcare providers. In 2016, SB 1177 was enacted, which allowed the Medical Board of California to recreate a new physician diversion program that adhered to the Uniform Standards. AB 408 discards those consumer protections and reconfigures any future program in the image of the failed diversion program. View original content to download multimedia: SOURCE Consumer Watchdog Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
San Francisco Chronicle
20-05-2025
- Business
- San Francisco Chronicle
State Farm asks for another California home insurance rate hike a week after getting a 17% jump
A week after securing approval to raise home insurance rates by an average of 17%, State Farm General revealed plans to ask regulators for an additional 11% increase, as well as considerably higher rates for condo owners and renters. The 17% increase, set to go into effect in June, was granted last week by Insurance Commissioner Ricardo Lara following a months-long proceeding that was classified as an 'emergency' following the Los Angeles fires. But State Farm had originally requested a 30% rate hike in June 2024 — and now, with the 17% emergency rate hike approved, it wants to return to its original number. The request, if granted, would go into effect in 2026, amounting to an 11% hike on top of the previous 17%. A hearing slated for this fall will allow State Farm to argue for justifying the full 30% rate hike it originally sought, according to new documents filed with the state on Monday. The insurer will also ask for higher increases for condominium owners and renters. In June, rates for those groups are due to go up by an average of 15%, but the new requests would bring that up to 36% for condos and 52% for renters. For rental dwellings policies — a type of insurance that protects landlords who rent out their homes — State Farm is only petitioning for final approval of the 38% rate hike that was initially approved earlier this month. State Farm did not immediately respond to a request for comment. 'They want more? We want more — more data, more transparency, more policyholders served, and more policies written in wildfire distressed areas,' Deputy Insurance Commissioner Michael Soller said in a statement Monday. 'Wanting doesn't change the law. All rates must be justified so consumers don't pay more than is required.' Though State Farm agreed to lower its rate hike request on an interim basis to 17% during a recent hearing before an administrative law judge, the full 30% was never off the table, said Carmen Balber, executive director for consumer advocacy group Consumer Watchdog. Balber's group participated in the rate review process and opposed the 17% rate hike at the April hearing. On Monday night, she said the group had not yet reviewed the new data submitted by State Farm to see whether it justified the large price hikes it's asking for. During the hearing, Lara pushed State Farm to secure a $400 million loan from its national parent company, State Farm Automobile Insurance Co., and to hold off on non-renewing large numbers of customers at once until at least the end of 2025. But Balber noted they made such a promise with only seven months of the year to go. 'What I think is clear from today's rate filing is that the commissioner didn't win anything for Californians in this proceeding,' Balber said. The newly filed documents include data on State Farm's losses from the Los Angeles wildfires. The insurer previously said it expects to pay $7.6 billion in claims from the Eaton and Palisades fires, all but $400 million of which will be paid by its national parent company through its reinsurance agreements — insurance for insurance companies. State Farm has maintained that those losses would warrant a large price hike. When insurance companies apply for rate increases, they let regulators know the maximum increase they feel they could justify under a formula enshrined in state insurance code. It is typically much larger than the rate request they actually ask for. In State Farm's case, it initially told regulators last June it could justify an up to 32.8% hike for homeowners while requesting the 30%. Its latest filing documents indicate the insurer believes its maximum permitted rate hike would be 77%. At the fall hearing, State Farm will be required to defend its requested rate hikes using facts and data, Soller said. A judge could approve the full requests, or the judge could find that even the emergency approved rates were excessive. In that case, the commissioner would order State Farm to refund its customers. 'Commissioner Lara ordered a full rate hearing to get to the bottom of State Farm's rate increase request,' Soller said. 'At the end of the day this is about making sure claims are paid in full and quickly by insurance companies with the financial standing to do that. State Farm will have to justify their rate request and show us their recovery plan in a full rate hearing.' The already-approved rate hikes will appear on homeowners' bills at their next renewal date following June 1. An additional rate increase, if approved, would take effect at each customers' first renewal in 2026.
New York Times
14-05-2025
- Business
- New York Times
California Approves 17 Percent Rate Increase for State Farm
State Farm will be allowed to temporarily charge an extra 17 percent for homeowners' insurance policies in California, after the state gave the company permission, in the wake of the catastrophic fires. The insurer will be allowed to charge the higher rate at least until a hearing later this year, the state announced on Tuesday. The insurance giant already received a 20 percent rate increase last year, a move that a consumer watchdog group, as well as homeowners struggling to be paid after their homes were destroyed in January in the Los Angeles fires, criticized as unfair and unfounded. State Farm requested the emergency rate increase in February, the month after fires ripped through the Pacific Palisades and Altadena neighborhoods of Los Angeles, razing over 16,000 homes and structures. The company — which insures one out of every five homes in California or roughly 1 million homeowner customers — had requested even more: a nearly 22 percent rate increase on homeowners' policies, citing a 'dire situation.' California, like other states hit by natural disasters, has faced threats from major insurers: Raise rates, or we leave the state, said Carmen Balber, the executive director of Consumer Watchdog, which led the effort to oppose the rate increase in hearings this spring. 'The commissioner has shown a tendency to roll over in the face of insurer threats to leave,' Ms. Balber said. The increase 'adds insult to injury' at a time when many homeowners insured by State Farm have reported delays or attempts by State Farm to lowball claims following the fires earlier this year, she added. In a statement, Ricardo Lara, the state's insurance commissioner, presented the rate increase as a difficult compromise for consumers. 'Let me be clear: We are in a statewide insurance crisis affecting millions of Californians,' he said. 'Taking this on requires tough decisions.' An administrative judge inside the California Department of Insurance approved the interim rate increase, following a hearing in April in which lawyers for Consumer Watchdog repeatedly asked State Farm to open its books and show why it needed such a large infusion of cash. According to Ms. Balber, the insurer refused to provide paperwork corroborating the insurer's dire financial straits. Meanwhile, the consumer group's own actuaries prepared a simulation of the State Farm General Insurance Company's earnings from premiums and projected losses from recent wildfires. The actuaries concluded both that State Farm had exaggerated the financial strain and that the rate increase was not justified, Ms. Balber said. The interim rates go into effect on June 1. There is a chance that the rates can be challenged again at a hearing this fall, when the question of whether or not State Farm's California offshoot is financially healthy will be addressed, Ms. Balber said. According to California's insurance commissioner, this later hearing will be when State Farm will be required 'to justify its financial condition and detail its recovery plan.' The administrative law judge found that State Farm 'is experiencing extraordinary financial distress, coupled with surplus depletion that threatens ongoing business operations,' according to Mr. Lara's statement. In a statement published on its website, State Farm said that the insurer remains 'deeply concerned about the financial position of State Farm General' — the insurer's California subsidiary — 'as it is difficult to match price to risk in California.' The statement further pointed to the S&P Global Rating's decision on Tuesday to downgrade the California State Farm subsidiary from an 'AA' to an 'A+' rating, a move attributed in part to 'a significant deterioration' in the company's capital position over the last five years. During the recent hearing in California and in the process that ensued, State Farm was forced to make some concessions — lowering the rate hike to 17 percent, from nearly 22 percent, as well as requiring State Farm's parent company to provide an infusion of $400 million in cash to its California affiliate. For years, advocates for policyholders have argued that the way in which insurers have organized themselves — with major national companies like State Farm having both a national company and a California subsidiary — protects the insurer but not the customer. The higher rate comes after survivors of the Eaton fire in the working-class community of Altadena organized, first on a WhatsApp group dedicated to pickleball and later on Discord, a platform better known for gaming. There they found each other and collected hundreds of firsthand accounts of homeowners insured with State Farm in California, who were struggling to get paid even when their homes had been leveled, said Joy Chen, a former deputy mayor of Los Angeles and the leader of the group, now known as the Eaton Fire Survivors Network. 'The ability to approve rate hikes is one of the few enforcement powers that the commissioner has,' she said. 'When you approve a rate hike without even examining whether a company is actually providing the service that they're being paid to provide, then it green lights systemic abuse,' she added. 'And it sends a message to every Californian who pays insurance premiums that you can pay, decade after decade, but if disaster strikes, your insurer may not be there — and your government may turn a blind eye.' In an emailed statement in response to questions regarding the claims of California wildfire victims who say they have been unfairly denied or lowballed by State Farm, a spokesman for the insurer added that the company was facing the largest fire event ever recorded in California. 'We actively work with each of our customers to resolve their claim,' the spokesman, Sevag A. Sarkissian, wrote. If State Farm's rate increase stands, other insurers are likely to follow suit.
Yahoo
13-05-2025
- Business
- Yahoo
State Farm Wins 17% Emergency Rate Hike for Homes After LA Fires
(Bloomberg) -- State Farm has been approved for an emergency 17% rate increase on homeowner insurance policies in California, part of an effort to shore up the state's largest insurer after the devastating wildfires in the Los Angeles area. As Coastline Erodes, One California City Considers 'Retreat Now' A New Central Park Amenity, Tailored to Its East Harlem Neighbors What's Behind the Rise in Serious Injuries on New York City's Streets? Lawsuit Challenges Trump Administration Policy on Migrant Children The hike, which takes effect in June, also allows a 15% boost for condo coverage, according to Insurance Commissioner Ricardo Lara. It follows a three-day hearing in April, where an administrative law judge found that the adjustment balanced consumer protections with the company's financial stability. The judge's proposed order was adopted by Lara on Tuesday. 'Let me be clear: We are in a statewide insurance crisis affecting millions of Californians. Taking this on requires tough decisions,' Lara said in a statement. As a condition of the increase, regulators ordered the insurer to bring in a $400 million cash infusion from its parent company and barred it from issuing mass non-renewals through the end of the year. State Farm has struggled with wildfire-related pressure and its credit rating was downgraded this week by S&P Global Ratings, which cited the January wildfires and ongoing climate risks. The Palisades Fire and the Eaton Fire in nearby Altadena in January killed 30 people and destroyed 16,000 structures, causing as much as $131 billion in economic losses. State Farm had initially sought a 22% hike but agreed to scale back the request during last month's hearing. A University of California at Los Angeles analysis estimates the company could face $7.6 billion in claims from the Palisades and Eaton fires, which caused $45 billion in insured losses statewide. Consumer Watchdog, a nonprofit advocacy group, criticized the decision to allow the rate increase, arguing that State Farm didn't provide enough evidence to justify charging higher premiums under Proposition 103, the state law governing insurance pricing. 'Today's decision that would make consumers pay now but allow State Farm to wait months before having to show its math is a great disappointment for consumers,' said Consumer Watchdog Executive Director Carmen Balber. Cartoon Network's Last Gasp Trump Has Already Ruined Christmas The Recession Chatter Is Getting Louder. Watch These Metrics US Border Towns Are Being Ravaged by Canada's Furious Boycott Maybe AI Slop Is Killing the Internet, After All ©2025 Bloomberg L.P.
Yahoo
13-05-2025
- Business
- Yahoo
Proposed Decision Approving $749 Million State Farm Home Insurance Rate Hike Goes to Insurance Commissioner Lara, Says Consumer Watchdog
LOS ANGELES, May 13, 2025 /PRNewswire/ -- A proposed decision recommending approval of State Farm General's request for an interim rate hike was issued by an Administrative Law Judge yesterday and sent to Insurance Commissioner Ricardo Lara. If approved by Lara, the settlement would impose a 17% rate increase for homeowners, 15% increase for renters and condo owners, and a 38% increase for rental dwelling policies as soon as June 1. Read the decision. "Today's decision that would make consumers pay now but allow State Farm to wait months before having to show its math is a great disappointment for consumers. Voter-approved Proposition 103 says a rate hike shouldn't come before the rate justification, but that's what happened here. We urge the Commissioner to reject the proposed decision so State Farm policyholders, many of whom are struggling to get their claims paid by the company after the Los Angeles fires, aren't overcharged," said Carmen Balber, executive director of Consumer Watchdog. Recent serious allegations have emerged regarding State Farm's mishandling of fire claims following the Eaton and Palisades fires in Los Angeles. Numerous policyholders have reported delays, denials, rotating adjusters, and inadequate assessments of damage, leading to financial hardship and widespread criticism of the insurer's claim handling practices. "It adds insult to injury for consumers to be forced to pay significantly more for coverage when some of these same consumers may be simultaneously trying to recover from the fires while State Farm is mishandling their existing claims," said Balber. Under the proposed decision, State Farm's rate hike will be subject to review in a full rate hearing, where the company will be required to fully justify the rate. That hearing is now tentatively scheduled for October. The agreement also promises refunds if the rate is ultimately proved to be excessive. "Refunds will be too little too late for homeowners who are already struggling to pay their home insurance premiums," said Balber. "Nevertheless, we will fully defend consumers' right to fair rates in the upcoming hearings where State Farm will finally have to justify what they want to charge." View original content to download multimedia: SOURCE Consumer Watchdog Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
