The state Senate passed a sweeping bill Wednesday that seeks to boost insurance affordability and transparency, as well as address industry practices that critics say limit patients' access to care.
After a bipartisan vote of 31 to 5 in the Senate, the legislation now moves to the House for final passage.
Among its many provisions, the bill would allow the state insurance commissioner to limit rate increases for insurers that have a track record of hiking costs, and fine those that don't comply with a state law requiring insurers to offer mental health coverage that's as robust as coverage for medical services.
Sen. Jorge Cabrera, D-Hamden, co-chair of the Insurance and Real Estate Committee, said the measure includes changes that residents have been demanding for years.
"This bill is an attempt to help our constituents all throughout Connecticut navigate an ever complex and moving health care system," Cabrera said during the floor debate on Wednesday.
The bill also contains measures directly responding to high-profile public scrutiny of the insurance industry over the past year on issues including prior authorization and proposed time limits on the use of anesthesia.
Sen. Tony Hwang, R-Fairfield, a ranking member of the Insurance and Real Estate Committee, called the bill "a reflection of compromise" that incorporated feedback on the original draft passed out of committee. The amended version narrowed the scope of certain affordability and prior authorization regulations on the industry.
Susan Halpin, executive director for the CT Association of Health Plans, said she appreciated Cabrera's willingness to negotiate, even if she doesn't agree with much of the bill.
"We appreciate the considerations that were made based upon the feedback we provided, particularly around the fiscal impact of various sections. While the bill still has a lot of problems, it's certainly better than it was. And like any good compromise, everybody is a little unhappy," Halpin said.
The package aims to tackle insurance affordability through a provision granting the insurance commissioner power to limit proposed rate increases on state-regulated plans for certain insurance carriers.
Under the bill, beginning January 1, 2027, if an insurer's rate increases exceed the state's "cost growth benchmarks" for the previous two consecutive years where data is available, the commissioner can reduce the carrier's proposed rate increase by up to two percentage points.
Passed first via executive order in January 2020 and adopted by the legislature in 2022, the state's cost growth benchmarks program requires the Office of Health Strategy to come up with an annual baseline for growing costs of health care. It also requires providers, insurers and others in the industry to report annual price increases.
This year's insurance omnibus bill also attempts to give some teeth to a 2019 Connecticut law requiring "mental health parity," meaning insurance providers cannot place greater restrictions on access to mental health services than on surgical or medical care. It also required insurers to submit reports to the state regarding parity.
The bill would allow the Insurance Commissioner to fine insurers up to $625,000 annually for noncompliance with the mental health parity law. It also would require the parity reports submitted by insurers, including the names of each company, to be made public.
Several supporters of the measure said the 2019 legislation didn't go far enough because it didn't include sufficient penalties for noncompliance. During a March public hearing on the bill, mental health providers testified they often hear from patients who can't access treatments they need because payers are less likely to provide adequate coverage for mental health treatment.
Cabrera said the insurance bill passed on Wednesday would strengthen existing law.
"Mental health parity has been the law in this state for half a decade, but in many instances it's a law in name only. This bill provides some much-needed bite in instances where insurers are skirting the law to the detriment of our citizens," Cabrera wrote in a statement following the bill's passage.
Over the past year, the insurance industry has come under strong criticism, and two measures in the bill attempt to rein in some of the practices that have elicited the most public outrage.
In December 2024, the fatal shooting of United Healthcare CEO Brian Thompson sparked renewed public contempt for prior authorization, the process by which doctors must obtain approval from insurance companies before providing certain services.
The bill passed by the Connecticut Senate prohibits "step therapy," a form of prior authorization, for certain diagnoses, including multiple sclerosis and rheumatoid arthritis.
"Step therapy" refers to a strategy used by insurers to contain costs, where patients first try a less expensive treatment option for a given condition before "stepping up" to a more expensive treatment option if the initial treatment is ineffective. Critics say the practice often delays patients' access to the most effective and appropriate treatments.
State law already prohibited step therapy for stage 4 metastatic cancer. In addition to multiple sclerosis and rheumatoid arthritis, the proposal passed by the state Senate would permanently extend an existing law prohibiting step therapy for schizophrenia, major depressive disorder and bipolar disorder, which was set to sunset on January 1, 2027. Additionally, it reduces the permitted period for step therapy for any diagnosis from sixty to thirty days.
The measure also prohibits insurers from placing limits on general anesthesia coverage, a direct response to a proposal from Anthem Blue Cross and Blue Shield last year to institute time limits on anesthesia services, which the company almost immediately reversed following public outcry.