Consumer Watchdog Campaign: Insurance Rate Regulation Saves Doctors $19 Million on Malpractice Premiums

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Santa Monica, CA — The California Department of Insurance announced today that it has saved doctors, dentists and other medical providers $19 million on their medical malpractice insurance premiums, using the state’s prior approval rate regulation authority to reduce unjustified premiums. Yet a doctors’ group opposes the same protection for their patients, said Consumer Watchdog Campaign.
A ballot initiative proposed for November would apply the same law that protects doctors from unfair malpractice premiums to health insurance premiums paid by patients. The trade association for doctors, the California Medical Association, has publicly opposed that ballot measure. In a letter sent yesterday, Consumer Watchdog Campaign questioned CMA leaders’ undisclosed ties to the insurance industry.
“Rate regulation just saved California medical providers $19 million that insurance companies wanted to overcharge them for malpractice coverage. How can the doctors’ lobbyists oppose giving California patients the same protections against unfair health insurance rates?” asked Carmen Balber with the Consumer Watchdog Campaign.
California insurance reform law Proposition 103 gives the state insurance commissioner authority to modify or deny medical malpractice (and other property-casualty insurance) rates that are unfair or excessive. The ballot initiative sponsored by Consumer Watchdog Campaign would apply the same regulation to health insurance policies sold to over 5.3 million Californians.
In a letter sent yesterday to CMA President Elect Dr. Paul Phinney, Consumer Watchdog Campaign questioned CMA’s position against oversight of health insurance rates:
“Physicians take an oath to do no harm to their patients. The California Medical Association opposes a ballot initiative to lower the cost of health insurance. How does that not harm patients?”
The letter noted CMA leaders’ close ties with the insurance industry. CMA President Elect Phinney has held executive medical positions at the state’s largest HMO, Kaiser Permanente, where he has been exclusively employed since 1984.
“Phinney may be an MD, but he hardly represents most doctors. He’s paid by Kaiser, and Kaiser is the largest insurance company in the state,” said Balber.
Today’s announcement by the Department of Insurance reduced rates by 7% for doctors and other medical providers at NORCAL Mutual, by 13% percent for dentists with The Dentists Insurance Company, and by 19% for the Medical Insurance Exchange of California’s Physicians and Surgeons program.
Consumer Watchdog participated in the challenge to the NORCAL rates under a provision of Proposition 103 that allows consumers to intervene in rate proceedings. Consumer Watchdog has also challenged malpractice rates proposed by The Doctors Company and Medical Protective. Past rate interventions by Consumer Watchdog have saved $2.2 billion on auto, homeowners and medical malpractice insurance rates since 2003.
The ballot initiative campaign must collect 505,000 signatures to reach the November ballot. The official ballot petition for the “Insurance Rate Public Justification and Accountability Act” can be downloaded to print, sign and return at
Kaiser is an outspoken opponent of proposals to regulate the rates it charges consumers. Dr. Phinney has represented CMA in multiple broadcast interviews opposing the measure to regulate health insurance rates without disclosing his ties to Kaiser. The letter from Consumer Watchdog Campaign called on Phinney to disclose his ties to Kaiser in any future interview.
Click here to read the letter to CMA President Elect Phinney.
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Consumer Watchdog Campaign is chaired by insurance reform Proposition 103 author Harvey Rosenfield. Consumer Watchdog Campaign is the campaign affiliate of Consumer Watchdog, which was founded by Rosenfield and whose president, Jamie Court, an award-winning consumer advocate and author, is the proponent of the proposed ballot initiative.

Carmen Balber
Carmen Balber
Consumer Watchdog executive director Carmen Balber has been with the organization for nearly two decades. She spent four years directing the group’s Washington, D.C. office where she advocated for key health insurance market reforms that were ultimately enacted into law as part of the Affordable Care Act.

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