Advocacy Group Pushes for More Robust Health Insurance Oversight

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Consumer Watchdog, a not-for-profit consumer advocacy organization, is pushing for a November 2012 ballot measure that would grant authority to the state insurance commissioner to regulate health insurance rates, the San Francisco Chronicle reports (Colliver, San Francisco Chronicle, 11/10).

Details of the Measure

The proposed ballot measure would update Proposition 103, which voters approved in 1988 to boost regulation of automobile and homeowner insurance (Lifsher, "Money & Company," Los Angeles Times, 11/9);

Under the proposal:

  • The state insurance commissioner would gain authority to accept or reject health plan rate increases (Van Oot, "Capitol Alert," Sacramento Bee, 11/9);
  • Health insurance executives would be subject to the penalty of perjury for providing false information on the need for higher health insurance rates for individual and small-group plans (Money & Company," Los Angeles Times, 11/9); and
  • Health insurers would be banned from considering lapses in coverage when setting rates for health, automobile or homeowner policies.

Consumer Watchdog President Jamie Court said polls conducted by the group have shown broad support for a "common sense proposal" to update Prop. 103 ("Capitol Alert," Sacramento Bee, 11/9).

The initiative is similar to two bills that have failed to pass the Legislature in the last five years ("Money & Company," Los Angeles Times, 11/9).

The organization has submitted the measure to the state Office of the Attorney General to be approved for circulation. The organization would have 150 days to collect the more than 500,000 signatures necessary to put the measure on the ballot next November.

Measure Faces Opposition

Charles Bacchi —  executive vice president of the California Association of Health Plans — said Consumer Watchdog's initiative is "deeply flawed" and would be defeated if it makes it to the ballot.

He added, "Broad-based opposition by employers, doctors, hospitals and medical groups to similar legislation shows that giving a politician the power to set prices does not address the real reason health care costs are increasing and could threaten patients' access to medical care" ("Capitol Alert," Sacramento Bee, 11/9).

For additional coverage on Consumer Watchdog's proposed ballot initiative, see today's Capitol Desk post.

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