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When Money Talks, Voters Listen: Group behind propositions 45 and 46 to continue seeking insurance-rate regulation, malpractice law changes

SAN FERNANDO VALLEY BUSINESS JOURNAL

The $100 million spent by insurance companies against two pro-consumer initiatives, coupled with an historically low voter turnout, was a recipe for consumers to lose on Election Day.

Total spending for and against California Propositions 45 and 46 outpaced even the most expensive U.S. Senate race in the nation - North Carolina's - where the stakes were control of the Senate.

A mere 6 million Californians voted Nov. 4 - that's 35.7 percent - shattering even the worst voter turnout predictions and reaching an historic low. The previous low for a statewide general election was 50 percent.

Here in Los Angeles County the results were even worse; just 24 percent of voters bothered to show up at the polls.

The defeat of Props 45 and 46 is a sobering reminder of the power of big corporate money in California politics when the electorate is not engaged.

The lack of a hot statewide candidate contest surely kept many voters away, and the newspapers seemed gleeful to report record low engagement. Front page headlines on Election Day drummed that message in, like the Los Angeles Times headline declaring 'Drama's mostly out of state" to undecided voters. The insurance companies' barrage of negative advertising piled on to suppress the vote and drive voters away from the polls.

The three biggest winners were the three biggest spenders: Woodland Hills-based Anthem Blue Cross and its parent company WellPoint Inc., which spent $18.7 million against Prop 45, Blue Shield of California at $12.3 million against Prop 45, and Kaiser, which ponied up a whopping $23.7 million of policyholders' money to oppose Props 45 and 46.

Prop 45 would have required health insurers to open their books and justify rates before increases take effect, just like auto, home and business insurance companies must already do in California.

But better oversight is the last thing health insurers want as they ride a wave of rising profits Kaiser just announced a 41 percent increase in profits for the third quarter. WellPoint increased its profit projections in October for the fourth time this year. At the same time, WellPoint's local arm, Anthem Blue Cross, imposed an excessive rate increase on its small business policyholders affecting 120,000 Californians. The insurance commissioner did not have the authority to reject the increase, despite examining Anthem's numbers and finding the rate increase to be unjustified.

The public consistently reports it wants protections against excessive rates, but insurance companies spent $57 million on deceptive advertising that hid their role in opposing Prop 45 and lied about its impact.

Not coincidentally, health insurance companies waited until after the election to announce individual rate increases for next year. Open enrollment begins this week and more consumers will soon discover that they're slated for another big hike.

Consumer advocates will continue to expose health insurance company profiteering and make the case with the public and the Legislature for health insurance companies to be as accountable for the rates they charge as business, home and auto insurance companies are.

Just as more must be done to rein in price gouging, the medical-insurance complex must be accountable to injured patients, including those who suffer at the hands of impaired doctors.

Proposition 46 would have required random drug testing and license suspension for a physician found to be impaired on duty, mandated that doctors check the state's prescription drug database when prescribing narcotics for the first time, and indexed for 38 years of inflation a cap on damages in negligence cases that prevents patients from seeking justice.

This light for greater patient safety will go on too in the court of public opinion, the regulatory process, the Legislature, the courts and, if need be, the initiative process. The families of innocent victims of negligence deserve access to justice. All Californians deserve to know they are safe from drunk, high and negligent physicians.

Prop 46 prompted discussion of patient safety problems that have been ignored for the better part of four decades in California. Newspapers across the state, whether for or against the ballot measure, acknowledged the need for reforms.

The Los Angeles Times editorial page was one of many: "The Legislature can and should be faulted for not adjusting the cap on damages for pain and suffering, not requiring healthcare providers to check the CURES database and failing to improve the state Medical Board's troubled monitoring program for substance-abusing physicians."

Insurance companies can and should be held accountable for their rip-offs and for medical negligence. Consumers will have their day. Justice will be done. The fight for the patient and consumer protections embodied in Props 45 and 46 is just beginning.

Here in Los Angeles County the results were even worse; just 24 percent of voters bothered to show up at the polls. The defeat of Props 45 and 46 is a sobering reminder of the power of big corporate money in California politics when the electorate is not engaged.

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Carmen Balber is executive director of Consumer Watchdog, a Santa Monica consumer and taxpayer advocacy organization. It was the chief sponsor of Propositions 45 and 46.