Sunday, September 21, 2014

Yes on Prop. 45

I'm always amazed at the willingness of the punditry to accept dumb arguments when they're made by rich people.  The arguments against Prop. 45 are right up there with the argument landlord groups made during the foreclosure crisis, which was that the tenant in a soon-to-be-foreclosed property shouldn't get a copy of the Notice of Default, since that violated the landlord's privacy rights.  Huh?  The Notice of Default is a public record ferhevensake.  What it would have done was to give tenants an early warning that the landlord was in trouble, and a tenant might decide to move, rather than deal with the inconvenience and hassle of the landlord's foreclosure.  I expect this kind of silliness in landlord-tenant battles.  There's no argument too stupid to make and there's no argument too silly for the Legislature to accept.

The arguments against Proposition 45 are just as silly.  What Proposition 45 would do is to allow our elected Insurance Commissioner to reject health insurance rate increases that the Commissioner found to be excessive.  That's what the Commissioner does now with car and property insurance, and it has saved Californian oodles of money.  But the health insurers are looking at that, and looking at Dave Jones, the present Commissioner, and throwing fits.  So is Covered California, which is, shock of all shocks, making the same arguments that the health insurance industry is making.  Wow, it's only been in existence for a year, and it's already too cozy with its industry!

So far as I can see, the arguments against it are two.  The first is that, somehow, having rate regulation will increase rates.  I don't think so.  It didn't raise rates for other insurance, and it hasn't done so in the 35 or so other states that do allow rate regulation. Their second argument is that we could get an Insurance Commissioner who is too cozy with the industry and would allow excessive increases.  Yes, you did just suffer whiplash.

What they're really afraid of is Dave Jones, who has been a very good Commissioner, and would probably scrutinize rates pretty closely.  He might also look at other bad habits of the health insurance industry like, oh for instance, classifying all drugs for a particular health condition as high-tier, requiring larger copays, in an attempt to discourage patients with particular pre-existing conditions, just like the bad old days.  One of Covered California's problems is that the Insurance Commissioner might get involved with plan benefits but, with bad behavior like this and the cozier-by-the-day relationship between CC and the insurance industry, we can only hope that would be true.

It's true that we could get a bad Commissioner--Chuck Quackenbush comes to mind--but I think the industry is more concerned that, given the direct impact on their lives, voters might elect a string of pro-consumer Commissioners.

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