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Ballot Initiative Would Target Health Care Premiums

SACRAMENTO BUSINESS JOURNAL

Debate over the controversial issue of health care rate regulation came roaring back midweek.

That’s when Consumer Watchdog, the Los Angeles advocacy group that makes health plans bristle, announced it has filed a proposed ballot initiative with the California Attorney General that would regulate health care premiums.

The initiative goes further than Assembly Bill 52, a hotly contested rate regulation bill withdrawn by its author in the final days of the last legislative session.

If backers get approval to circulate petitions to qualify the measure — and get the half million signatures necessary to put it on the ballot — California voters will get a shot next November to make premium rate regulation a reality.

The proposed measure seeks to ensure fair and transparent rates by:

• Requiring health insurance companies to publicly disclose and justify their rates before they can take effect.

• Prohibiting unfair pricing based on prior coverage and credit history.

• Requiring health insurance companies to pay a fee to cover the cost of administering the new law.

“Getting control of health insurance premium increases in California is like trying to slow a run-away train,” Consumer Watchdog president Jamie Court said in a message to supporters Wednesday. The proposed Insurance Rate Public Justification and Accountability Act “will change the insurance industry’s arbitrary and unreasonable pricing practices and give needed relief to consumers,” he added.

By Thursday morning, California Association of Health Plans, a HMO trade group, blasted the measure as bad policy that would place arbitrary limits on health insurance premiums.

“It does nothing to provide relief from the underlying cost pressures driving up insurance premiums,” Charles Bacchi, executive vice president of the trade group, said in a prepared statement. “It introduces a costly new bureaucracy at a time when our state can’t afford it and jeopardizes the state’s existing work to provide affordable access to care for all Californians.”

The California Association of Physician Groups put off formal comment until it had reviewed the measure, but expressed concern. So did the California Hospital Association.

Anthony Wright, executive director of Health Access, a group that supported AB 52, declined comment because he was still reviewing the measure, too.

So did state insurance commissioner Dave Jones, a vocal proponent of AB 52. Deputy commissioner Byron Tucker reiterated Jones’ efforts to garner authority to reject excessive health insurance rate hikes.

Court expects the measure to clear for signature gathering by early January — and to turn them in by May 1.

Kathy Robertson covers health care, labor/workplace issues, law, immigration, medical technology and biotechnology for the Sacramento Business Journal.