The state’s action is the boldest yet in dealing with the industry’s increasingly controversial practice of canceling individual coverage—known as rescission—after patients have taken ill and submitted medical bills.

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.