Los Angeles, CA — Patients who have suffered skyrocketing health insurance rates joined with the leaders of Consumer Watchdog Campaign to turn in more than 800,000 voter signatures for a ballot initiative requiring health insurance companies to open their books and justify rates, under penalty of perjury, before their rate increases take effect. Insurance Commissioner Dave Jones joined the advocates to drop off 240,000 signatures at the Los Angeles County Registrar Recorder in Norwalk.
“Health insurance premiums in California have increased over the last decade five times faster than inflation because health insurance companies don’t have to justify their rates or get approval before raising rates,” said Jamie Court, president of Consumer Watchdog, and the proponent of the Insurance Rate Public Justification And Accountability Act. “Our initiative will subject health insurance rates to the same transparency and accountability that already apply to auto insurance and home insurance rates in California. The legislature has refused to act for more than a decade; now it’s the voters’ turn to decide their own fate.”
800,000 signatures to qualify the initiative for the November ballot are being filed at 58 county registrar offices across the state today. The initiative needs 504,000 valid signatures to qualify for the ballot, and it must be certified to qualify for the November ballot by June 28. US Senator Dianne Feinstein is an honorary co-chair of the initiative campaign.
The initiative extends the successful insurance reform provisions of the 1988 ballot initiative Proposition 103 to health insurance and updates Prop. 103 to ban unfair rating practices in health, home and auto insurance, the three types of insurance Californians are required to buy by law or economic necessity. Thirty other five states give regulators the power to approve or reject health insurance rates before they take effect, but not California. The initiative would change that.
Consumer Watchdog’s founder Harvey Rosenfield authored Prop. 103 and helped draft the new ballot measure. The Consumer Federation of America reported in 2008 that Prop. 103’s rate regulation has saved drivers in California $62 billion on their auto insurance bills.
“Twenty-four years ago, ignored by a legislature beholden to insurance lobbyists, California voters took matters into their own hands and passed a law – Proposition 103 – which required auto, home and business insurers to open their books to public scrutiny and justify their rates before they took effect,” said Rosenfield, the Chairman of Consumer Watchdog Campaign. “Now, over 800,000 Californians have asked their fellow citizens to extend that law to health insurance. This time, it’s not just our wallets that are at stake. This initiative is about protecting the health of Californians against the rapacious greed of the Wall Street HMOs and insurance companies that care more about profits than people.”
“As a self-employed, single mom, I’ve struggled for more than a decade to balance the cost of health care with the need to seek medical help for my family,” said Laurel Kaufer, from Studio City, who joined in signature turn-in in Norwalk. “My premium has tripled in the last decade, and on May 1 the price of my health insurance will go up by 16% to $729 a month. Add in my sons' coverage and I pay $1136 every month.
“If I have to get pre-approval from my insurance company every time I want my health care paid for, shouldn’t they have to get approval when they want me to pay more?”
The ballot measure:
Requires health insurance companies to publicly disclose and justify, under penalty of perjury, proposed rate changes before they take effect.
Makes every document filed by an insurance company to justify a rate increase a public record.
Requires public hearings on proposed rate increases.
Gives Californians the right to challenge excessive and unfair premium rate â€¨increases.
Prohibits health, auto and home insurers from considering Californians’ credit history or prior insurance coverage when setting premiums or deciding whether to offer coverage.
- Gives the elected insurance commissioner authority to reject unjustified rate increases.
Consumer Watchdog Campaign is the advocacy arm of Consumer Watchdog, a California-based non-profit, non-partisan organization founded in 1985. Visit the campaign website at: www.JustifyRates.org. Learn more about insurance rate regulation at www.ConsumerWatchdog.org
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