Groups representing insurers, hospitals and doctors lobbied against the bill, saying the regulations would add bureaucracy and do nothing to address high and fast-rising medical costs that help drive rate increases. Ultimately, they argued, rate regulation could reduce access to care.

With Republican lawmakers lined up solidly against the proposal, Feuer needed the support of at least 21 of the 25 Democrats in the Senate. Several had raised questions about the bill at a Senate Health Committee hearing in July.

Committee chairman Sen. Ed Hernandez, D-Baldwin Park, said he would not back it without amendments to address issues such as how to limit political influence in decision making and whether outside parties could intervene in a rate case.

Even though talks on amendments continued into this week, there were still at least five Senate Democrats solidly against the bill.

"Right now, not enough senators are prepared to vote for any form of health insurance rate regulation," Feuer said in the statement.

Without state regulatory power to reject excessive rates, he said, millions of Californians will continue paying too much for health insurance or be unable to afford doctor visits.

Even if the bill had been approved by the Senate, its fate with Gov. Jerry Brown was uncertain. His administration warned that the regulatory oversight and appeals could cost millions of dollars per year at a time when the state could face billions in additional budget cuts if tax revenue falls short of projections.

Backers said the delay would hurt California families.

"This is a huge setback for Californians who can't afford another rate hike," said Austin Price, a spokesman for the California Public Interest Research Group, which noted that health insurance rates have increased at about three times the rate of inflation over the past decade.

The California Association of Health Plans, a vocal opponent of the bill, said lawmakers recognized it was deeply flawed, misguided and bad policy.

"AB52 failed to address the underlying cost pressures that are driving up the price of coverage," said Patrick Johnston, association president and chief executive, in a statement. Only addressing those root causes can lead to health care affordability, he said.

The bill drew heavy lobbying from both sides. MapLight, a nonpartisan group that tracks campaign contributions found that groups supporting AB52 gave an average of almost $192,000 from 2007 through 2010 to each of the six senators who voted for it in the Senate Appropriations Committee, more than three times as much as the average they contributed to three GOP senators who voted against it. Opponents contributed to Democrats in the Assembly who didn't vote for the bill or opposed it in June, MapLight found.