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# Dave Jones: ‘Make Health Insurance Companies Justify Their Rates’
January 16 2014
Written by Rosemary Jenkins.
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***THE VIEW FROM HERE***-The **Affordable Care Act (ACA)** has certain provisions that apply to all states: children can remain on their parents’ policies until age 26; no cap on coverage; no exclusions for pre-existing conditions—to name an important few. Though rates and coverage packages can be negotiated, not all states have the power to enforce negotiated decisions.
For years most of us have been frustrated that health insurers have been unfettered in their ability to raise rates and reduce coverage. However, under **State Insurance Commissioner, Dave Jones’** plan, these companies will be held accountable. Despite ACA provisions, rates can continue to climb, but with passage of the Jones’ statute, slowing and/or temporarily negating rate hikes altogether will prevail.
Back in **1988, Proposition 103** (sponsored by *Consumer Watchdog*) passed handily with support of California voters. It gave the Insurance Commissioner at that time the ability to set and enforce guidelines for companies that insure **vehicles, houses, and businesses** but the bill failed to include healthcare when the reform was introduced.
Consumers have saved billions of dollars as a consequence of that consumer law while the insurance companies have continued to accrue generous profits. Over the last 25 years, rate increases have been about 10% of what they used to be (3.8% in California compared to 42.9% nationwide).
Californians have saved 100 billion dollars while insurers have managed to garner huge profits. It is clear, then, that reasonable rates can be beneficial to both sides of this equation and, thus, opposition to this new bill ought to be a moot point.
Though 80 billion dollars were thrown into the pot to oppose 103, its supporters for fair rates with reasonable enforcement nevertheless prevailed and Propositions 103 passed. Just as big-moneyed interests put up a formidable and contentious opposition 25 years ago to that insurance reform, we can expect the same kind of corporate funding to try to prevent this practical healthcare act from passing.
There is concern that *interveners* (“individuals who are not already a party to an existing lawsuit but who make themselves a party either by joining with the plaintiff or uniting with the defendant \[regarding\] the plaintiff's claims”) will disrupt the roll-out of this law should it pass in November of this year. Republicans and other oppositional interests can present challenges to slow down or halt the bill’s implementation. Furthermore, they can muddle and complicate the process for new applicants to the ACA (Covered California in our state) whose next enrollment deadline is October 15, 2014. Without questions, this kind of behavior must be blocked.
In addition, as written, the Jones’ statute (which is actually a modification of Proposition 103) presents a conundrum--a loop-hole for larger employers whose health packages will not be affected by this law though their insurers will still have to abide by ACA guidelines. This exception was included because many unions were concerned that an avalanche of negative publicity would totally confuse the electorate and turn it against the proposed law. Keep in mind that this practice is the *modus operandi* of such oppositional groups. Besides, the effort to defeat such oppositional politics would, for all intents and purposes, empty union coffers at a time when everyone is struggling financially.
These same unions are worried that those loopholes would put their members at a negotiating disadvantage. In fact, **35 other states** have already enacted similar propositions to “require health insurance companies to get approval for rate increases before \[such increases can\] take effect”—a concept that Senator Dianne Feinstein whole-heartedly supports. The roll-out of such laws in these other states has not produced the results which concern many of those union leaders and their rank-and-file. On the other hand, should this bill pass, the issue related to the larger companies can be addressed again and remedied. Because this modification to Proposition 103 is statutory, present and future Insurance Commissioners will be mandated to enforce the entire law as modified and will not be free to select which part of the law they want to enforce or even to override its mandates and authorizations.
To be fair, many unions (such as the teachers’ unions) have given their unwavering support to the Jones initiative. There are at least five facets to this bill that attract their support. The law would provide the transparency that it is presently lacking. It would accomplish the following and, perhaps most importantly, have the power of enforcement from the Office of the Insurance Commissioner. To quote:
- Require health insurance companies to **publicly disclose and justify**, under penalty of perjury, proposed rate changes before they take effect
- Make every document filed by an insurance company to justify a rate increase, a **public record**
- Require **public hearings** on proposed rate increases
- Allow Californians **to challenge** unjustified premium rate increases
- Give the insurance commissioner the **authority to reject** excessive rate increases.
Though many Californians presently have or will have good health packages because of the ACA (and Covered California), the following insurance companies are not likely to comply willingly with the new requirements of this law. Kaiser, Blue Shield, Aetna, Anthem, Healthnet, and United Healthcare are among the insurers over whom it is so necessary that the State have adequate oversight. It will take *transparency, clarity, and the power of enforcement* (which this law prescribes) to make sure that they do.
The insurance companies will have to justify any rate increases should this statute pass—just as they must for the other insurance entities that Proposition 103 covers.
When this happens, with the passage of Dave Jones’ Insurance Accountability Act, all of us will benefit!
***(Rosemary Jenkins is a Democratic activist and chair of the Northeast Valley Green Coalition. Jenkins has written*** ***Leticia in Her Wedding Dress and Other Poems******,** [A Quick-and-Easy Reference to Correct Grammar and Composition](http://bookstore.authorhouse.com/Products/SKU-000339310/A-QuickandEasy-Reference-to-Correct-Grammar-and-Composition.aspx) and Vignettes for Understanding Literary and Related Concepts. **She also writes for CityWatch.)***
***-cw***
***CityWatch***
***Vol 12 Issue 5***
***Pub: Jan 17, 2014***
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