Ted Gaines Announces Run For Insurance Commissioner

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Possibly setting up a clash over health insurance regulation, Sen. Ted Gaines, R-Rocklin, announced Thursday that he will run for California insurance commissioner next year.

Gaines won a new Senate term in 2012, which means he is not up for re-election until 2016 and can seek statewide office next year without risking the Senate seat.

Gaines has positioned himself as an alternative to Insurance Commissioner Dave Jones, criticizing the Sacramento Democrat for having a "cozy relationship" with trial lawyers, vowing to crack down on unwarranted lawsuits and arguing that heavy-handed regulation risks distorting the insurance market. Gaines said his company, Gaines Insurance, gives him insight into how the industry functions.

"I'm trying to make sure we're looking out for the interests of consumers, and I believe that through the promotion of additional competition in the marketplace we give the consumer more choices and hopefully at lower rates," Gaines told The Sacramento Bee. "I want to make sure we have plenty of access in the marketplace."

That offers a marked contrast with Jones, who has made a push for the authority to regulate health insurance rates a centerpiece of his tenure – an even more relevant topic given the launch this week of California's new health insurance exchange. A measure requiring insurance commissioners to sign off on changes in health insurance rates will go before voters in November 2014, having fallen short of the signature threshold needed to get on the 2012 ballot.

Gaines invoked his concerns about implementation of the new federal health care law as an impetus for his campaign.

"I'm very nervous about this being rolled out in a kind of organized, understandable common-sense approach," Gaines said. "I'm very worried about insurance rates, and I'm worried it could be a setup for disaster in terms of insurance rates going up."

While Gaines touts his industry experience as a qualification for the job, he acknowledged that his ownership of an insurance firm would represent a conflict of interest if he becomes commissioner. He said that if elected, he would sell the company.

But even so, Gaines would be compromised by his ties to the insurance industry, according to Jamie Court, president of the nonprofit advocacy group Consumer Watchdog and sponsor of the rate-regulation ballot measure.

"What this run represents is an attempt to put the insurance industry back in charge of insurance regulation," Court said.

Gaines now faces no other obstacles to claiming a nomination: former Assemblyman Mike Villines, who secured the Republican nomination for insurance commissioner in 2010 but lost to Jones despite heavy support from the insurance industry, had declared his intent to run in 2014 but terminated his campaign account in 2011.

But Gaines will start out trailing Jones in financial clout. As of July, Jones had around $919,000 in his re-election war chest, according to the California secretary of state's office.

Call Jeremy B. White, Bee Capitol Bureau, (916) 326-5543.

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