barack-obama_web.jpgSACRAMENTO, Calif. (AP) _ President Barack Obama on Friday congratulated California leaders for passing legislation that will prepare the nation's most populous state for federal health care reform.

The state is "taking an important early step toward reforming our private insurance marketplace so that California families and small businesses will have high-quality and affordable health insurance choices in 2014 when reform is fully implemented,'' Obama said in a statement.

Gov. Arnold Schwarzenegger on Thursday signed seven major health care bills, including two measures establishing a Web-based insurance exchange that will allow consumers to comparison-shop for coverage.

California is the first state to approve an oversight board for insurance exchange marketplaces since the federal law was enacted earlier this year. Massachusetts implemented its exchange prior to reform.

Additional bills signed Thursday prohibit insurers from denying coverage to children because of a pre-existing condition; allow young adults to stay on their parents' health care plans until age 26; and prevent insurance companies from canceling coverage except in cases of fraud or misrepresentation.

Schwarzenegger on Friday joined Assembly Speaker John Perez, D-Los Angeles, and state Sen. Elaine Alquist, D-Santa Clara, the authors of the exchange legislation, for a signing ceremony in Los Angeles to highlight the bills' passage.

The legislation "moves California one giant step closer toward quality, affordable health care for all,'' the Republican governor said.

More than 6.7 million Californians are currently uninsured, according to the Henry J. Kaiser Family Foundation. The new federal law will require most Americans to carry insurance or pay a fine.

California's exchange will be up and running by the time that law takes full effect in 2014. Between now and then, a five-member exchange board and staff will lay the groundwork to enroll Californians in the program and select qualified health plans to participate.