There’s been a lot of confusion out there about Prop 45—and much of it has been the intended result of an extremely well-financed opposition. When you have a ton of money, you can effectively flood the airwaves, the internet and folks’ mailboxes with an ocean of misinformation.
Proposition 45 is quite simple. Here’s the precise verbiage from the ballot as posted on the Secretary of State’s website: “any rate increases for individual and small group health insurance would have to be approved by the Insurance Commissioner before taking effect.”
That’s all. This law would require California’s four major health insurance providers to publicly justify their rate increases and be transparent about their process.
Deregulation of the health insurance industry has already led to consolidation, which in turn has led to lack of competitive pricing. Now the monopoly doesn’t even want the state to prevent them from committing the consumer gouging they’re notorious for.
According to Dylan Roby at UCLA’s Fielding School of Public Health, there are 30 other states that have such a law on the books, and in most of those states insurance commissioners have been successful in keeping premiums down.
Who’s opposed to this? Predictably, the four companies who control most of the health insurance marketplace in California. In fact, these four—Kaiser, Wellpoint, Blue Cross Blue Shield and Health Net—have poured a little under $60M to make sure they go unregulated.
Think about that for a minute. The health insurance industry is taking the money you and I spend on premiums to make sure there’s no oversight on rate increases. I don’t know about you, but that’s not how I want my premiums to be spent. I‘d rather they went to things like preventive care. The $60M campaign against regulation alone illustrates exactly why the health insurance industry needs to be regulated.
The money we pay toward premiums is being used to mislead California voters about the implications of the proposition, because, well, opponents of the measure can’t rely on reasoned arguments to win you over. Some of the tactics they’re using were the same tactics they used to try to derail the Affordable Care Act. It goes something like this: ‘a politician’ will be making choices about what kind of treatment you receive.
Not true. Again, the Insurance Commissioner’s office will simply review premium rate increases and if they seem excessive, they will ask the insurance companies to justify them.
It’s not surprising that health insurers don’t want oversight. But what is surprising is that supporters of ACA and Covered California—like Nancy Pelosi—are also speaking out against Prop 45. The concern is that if there is oversight, some of the health providers may leave the market.
That’s victim mentality: ‘if I ask him to stop hitting me he might leave’ mentality. This is not worthy of public servants who are supposed to be fighting for us against the Goliaths.
Here’s what actually did happen in the first year of the Affordable Care Act and Covered California—rates shot up significantly. All who had pinned their hopes on the ACA creating a better marketplace through increasing participation have been sorely disappointed. According to Insurance Commissioner Dave Jones, increases for individual coverage ranged from 22% to 88% between 2013 and 2014 without any explanation whatsoever from the industry.
I love the fact that ACA makes it illegal for insurers to deny coverage based on pre-existing conditions, but I hate the fact that there’s no oversight on rate increases. You may trust an industry that came up with the idea of pre-existing exclusions or the practice of cutting people’s coverage who had expensive illnesses (a practice called ‘rescission’), but I don’t trust them. And I’m not sure about Covered California’s ability to negotiate a good rate on behalf of individual policy holders. My suspicions were confirmed this week when I got a notice in the mail from Anthem Blue Cross that my premiums will be going up 67% in 2015—no explanation. I have no health problems, no conditions. I know this is just anecdotal, but I got the feeling I’m not the only one.
Think about it this way: if the insurance industry plans on raising premiums at a reasonable pace (which would be a first) then they wouldn’t be fighting this tooth and nail.
Vote yes on Prop 45.
Alison Gallant is a freelance writer living in Los Angeles
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