( – promoted by Brian Leubitz)

As 2nd Anniversary of Federal Health Reform Law Approaches, CA Ballot Measure Seeks to Control Skyrocketing Health Insurance Rates.

Anthem Blue Cross will raise health insurance rates for nearly 600,000 Californians by as much as 20% on May 1. A ballot initiative to make health insurance more affordable by regulating premium increases is necessary to protect Californians from excessive rate hikes, said Consumer Watchdog Campaign today.

Friday is the 2nd anniversary of the federal health reform law, which will require every American to have health insurance by 2014 but does not control what private health insurance companies can charge. The ballot initiative proposed by Consumer Watchdog Campaign would require health insurance companies to publicly justify rates, under penalty of perjury, and get rate increases approved before they take effect.

“Every time insurance companies force another double-digit rate increase on consumers they make the case for our ballot initiative to rein in excessive rate hikes. If Anthem had to include a copy of our petition in the rate increase notice it mailed to more than half a million consumers, we’d already have the 505,000 signatures necessary to qualify the measure for the November ballot,” said Carmen Balber with Consumer Watchdog Campaign.

The ballot measure would regulate health insurance policies that cover 5.3 million Californians. 35 states have the power to reject excessive rate increases, but California does not.

“The Affordable Care Act ends some of health insurers’ worst abuses – like cancelling coverage when patients get sick, or charging women more just for being women. But the law falls short on cost control. Health reform cannot succeed if we don’t put the brakes on skyrocketing insurance premiums. Strong rate regulation will lower premiums, give insurers incentives to cut spending and save health reform,” said Balber.

On Monday, the U.S. Supreme Court will begin hearing oral arguments in a case that will determine whether the law’s mandate that individuals purchase insurance violates the Constitution. Regardless of what the court decides, the experience with health reform in Massachusetts shows that consumers will need the protection of rate regulation to hold down insurance prices, said the group.

Consumer Watchdog released a report last year demonstrating how rate regulation has begun to curb insurance premiums in Massachusetts, where the mandate that people buy health insurance — the model for the 2010 federal reform law — failed to control costs. Other states that instituted or strengthened state laws requiring rate review and approval of health insurance rates, including New York, Oregon and Maine, have also seen cost-control results. States without regulation of health insurance rates have seen massive and unjustified rate increases take effect with no power to stop them.

A new report from the California HealthCare Foundation finds that 38% of Californians say the cost of their health insurance went up in 2011, and 37% delayed getting health care they needed because of costs.

“The reality is that consumers will not purchase insurance they cannot afford, and insurance prices become more out of reach for families every year,” said Balber. “Experience in states from California to New York has shown that rate regulation is the only way to force insurance companies to open their books, justify spending, and block excessive profits.”

The Centers for Disease Control and Prevention reported last week that 1 in 5 Americans are burdened by medical debt and half of them are unable to pay the debt at all. Health insurance premiums in California increased at a pace five times the rate of inflation in the last decade, according to the California HealthCare Foundation.

Download the Consumer Watchdog Report, “Health Reform and Insurance Regulation: Can’t Have One Without The Other”.

Read more about the initiative at www.JustifyRates.org.

What Chutzpa! The four health insurance companies that control 71% of the California market today attacked Consumer Watchdog as “a special interest group.” Their press release below only acknowledges in the fine print that the attack is “Paid for by Anthem Blue Cross, Kaiser Foundation Health Plan, Inc., Health Net, Inc., and Blue Shield of California.”

The insurance companies are scared because we are on the road to qualify our ballot measure that forces them to publicly justify their rate hikes and lets the insurance commissioner reject unreasonable rates. Still, it’s Orwellian to see the big insurance companies hiding behind the lab coats of doctors and trying to smear a consumer group with a two-decade history of saving consumers tens of billions of dollars on their insurance bills.  

You can see the type of opposition we’re up against, and it’s only March. Think of what they’ll say and do between now and November.

Please help us remind Californians who is on their side and who is ripping them off every day. Donate now to the “Justify Rates” ballot measure campaign.

A report out today shows the health care industry generated $35.7 million in lobbyist spending in 2011, more than any other industry in California, and Kaiser was the largest spender at $3.5 million. Our ballot initiative would prohibit insurance companies like Kaiser from passing on lobbying expenditures to policyholders as premium increases, the same way current law prohibits auto and homeowners insurers from passing on those costs.

That’s why health insurance companies are scared and are willing to do anything to avoid regulation.

Will you make a contribution to the ballot measure campaign to fight back today?

Initiative To Allow Regulators to Reject Excessive Rate Increases Would Give California Families Protection

The first large-scale survey of Americans about their problems with medical debt show 1 in 5 are burdened by medical debt and half of them are unable to pay the debt at all. Having health insurance is a key to being able to pay for medical care, said the Consumer Watchdog Campaign, but spiraling insurance rates have left millions of Americans uninsured or badly underinsured. A ballot initiative proposed in California would make health insurance more affordable by regulating premium increases, and give the state the ability to curb excessive rates before they go into effect.

The report released today by the federal Centers for Disease Control found that medical debt hit hardest at younger families and the working class, people who are least likely to be able to afford insurance.

“When one in five Americans are in medical debt it’s clear that we’re not doing enough to make health insurance affordable. Soon, federal law will require every American to have insurance, but nothing controls what health insurers can charge. States need the power to say no to excessive health insurance premium hikes,” said Carmen Balber with the Consumer Watchdog Campaign. “The California ballot initiative will allow the state to rein in out-of-control spending on insurance bureaucracy, executive salaries and profits that is driving the up cost of health care and driving consumers out of coverage and into medical debt.”

Lead report author Robin Cohen, of the CDC’s National Center for Health Statistics, said insurance, public or private, frequently determines whether families can pay their health care expenses.

“But even among people with private insurance, about 16 percent had trouble paying medical bills and 6 percent couldn’t pay at all,” Cohen told Health Day.

A ballot initiative sponsored by Consumer Watchdog Campaign and aiming for the November California ballot would require insurance companies to justify rate increases, under penalty of perjury, before they take effect. Regulators would have the power to reject or modify unreasonable premium rates, and limit the amount of wasteful overhead, profit and executive compensation that insurance companies may pass on to consumers. The measure would add health insurance policies sold to 5.3 million Californians to the state’s rate regulation law. It also prohibits health, auto and home insurers from using Californians’ credit history or prior insurance coverage to increase premiums or deny coverage.

The measure is based on the insurance reform law, Proposition 103, that regulated auto and homeowners insurance in California. That law has saved drivers $62 billion in premiums since 1988, according to a 2008 Consumer Federation of America report.

The campaign is using a mixed paid and volunteer effort to gather the 505,000 signatures necessary to qualify for the November ballot. U.S. Senator Dianne Feinstein, who was the first person to sign the petition, authored an email to millions of California voters asking them to download, print, sign and return the official ballot petition online at www.JustifyRates.org.

The federal health reform law requires review of some health insurance rate increases, but does not give any state regulator the authority to modify or deny rate increases even when they are found to be excessive or unreasonable.

Insurance Industry Kills Bill That Would Have Forced them to Justify Hikes

by Brian Leubitz

Well, score another win for the insurance industry over consumers:

Feuer: “We’ve hit a temporary roadblock on the bill.  The bill remains on the floor of the Senate, however, and I’m going to work very hard between now and next January to change this dynamic.”

Health insurance companies and business groups have fought the measure fiercely.  The California Association of Health Plans says the bill would sharply increase costs to the state – without doing anything to lower the cost of health care. (Cap Public Radio)

Of course they say it would increase rates, because they can. Not because they have any data to show that is true.  Not because rates in states that have similar measures are higher, but because they can.

However unfortunate, there are enough anti-consumer Democrats to kill the bill.  Let’s be clear here, this is nothing about being moderate.  This is about insurance industry contributions controlling several Democrats in Senate, to the detriment of their constituents.  

The bill will be back in next year’s session, by then we can hope that these as yet unnamed legislative cowards can be convinced of the error of their ways.  We need leaders who will stand up for California consumers, rather than just bending to the will of AHIP.

(Seneca Doane has a great diary where he is keeping track of the votes and one here with all the phone numbers. If you know somebody in these districts, be sure they call in. Local opinion matters!  Sens. de Leon, Alquist, Hernandez and Rubio should all be top targets.   – promoted by Brian Leubitz)

Last week, I had a brief chance to speak with Insurance Commissioner Dave Jones, and before he and I had to attend to other matters, he briefly stressed the importance of AB-52’s pre-increase rate regulation.  The first thing that you have to consider, of course, is that AB 52 would greatly expand the Insurance Commissioner’s power.  Now, Jones has been pushing the bill even when Poizner was calling the shots, so there must be something else.

That something else is the poor division between the Department of Insurance, which Jones heads, and the several other departments in the executive branch that manage health insurance.  When it comes down to it, the elected Commissioner, under the current system, actually has relatively little power in that whole process.  AB 52, at its core, is a simple regulation that would give the Dept. of Insurance the power to block unreasonable rate increases.

For an industry that has some rather unclean hands, it unsurprisingly fighting this tooth and nail.  It is a majority vote measure, so they must rely on a few Democrats to hold up the process.

Tomorrow’s vote is the Senate Health Committee, and under normal circumstances, with two co-authors of the bill on the committee, would likely get at least a party line vote.  But these are hardly normal circumstances, and many of these Democratic Senators have a insurance money habit that is quite hard to break. nyceve has a diary up at dKos with the names and numbers of the Senators on the Committee, which you can also find below the fold.  If I had to prioritize my calls, I would go Hernandez, Alquist, Rubio, de Leon, Wolk, DeSaulnier, in that order.  But, if you are a constituent of any of these Senators, please, please call them right away.

There will be more work to go to get this through the Senate, and then pressuring the Governor to sign it.  However, this important first step should not be neglected.  Get those phone calls in as soon as possible.

  Senator Ed Hernandez (Chair) — 916-651-4024

  Senator Elaine Alquist — 916-651-4013

  Senator Kevin de Leon — 916-651-4022

  Senator Mark DeSaulnier (AB 52 co-author) — 916-651-4007

  Senator Michael Rubio — 916-651-4016

  Senator Lois Wolk (AB 52 co-author) — 916-651-4005