Health Insurers, Physician Group Oppose Ballot Initiative

It’s not even a ballot measure yet, but it’s certainly getting ballot-measure treatment.

Yesterday, a coalition of health insurance organizations, the California Medical Association, the California Hospital Association and other groups announced they were joining forces to fight a ballot measure designed to regulate health insurance rate increases.

“This initiative does nothing to address the cost drivers in the health care system,” according to Paul Phinney, president-elect of the CMA. “I just think this initiative is the wrong idea.”

Advocates for the proposed ballot measure said they’re not surprised at the opposition, since the CMA, CHA and major health insurers all came out strongly against last year’s AB 52, a rate regulation bill that the Legislature failed to pass and that serves as a rough model for the new proposition.

“Right now we’re just working on getting this on the ballot,” Carmen Barbour of Consumer Watchdog said of the signature-gathering effort. “We’re well on-pace to make the ballot by May 1.”

Barbour said her organization is aiming to gather 30% to 35% more signatures than the 505,000 needed to qualify for the November ballot, “just to make sure that there’s no question,” she said.

Both sides questioned the financial motivations of the other — that large health insurance corporations sponsor one organization, and consumer rights trial attorneys sponsor the other.

The tagline at the end of the press release that announces the formation of Californians Against Higher Health Care Costs reveals that four major health insurers supply much of the funding for the organization:

“Paid for by Californians Against Higher Health Care Costs, a coalition of doctors, hospitals, health insurers, and California employers. Major funding by Anthem Blue Cross, Kaiser Foundation Health Plan, Inc., Health Net, Inc., and Blue Shield of California,” the release said.

To Barbour, that funding source of major insurers is revealing.

“It’s a coalition that includes doctors and hospitals, but the cost for it is paid by four insurance companies,” Barbour said. “Four insurance companies who are desperate not to see this measure succeed.”

Phinney had his own spin on financial motivation: “There’s another big piece to this that is empowered by this initiative,” he said, “to derive consumer attorneys’ fees from any rate increase. That’s money being pulled out of health care delivery. I see an increase in [health care] costs down the line from this.”

California’s secretary of state recently released data that showed health care insurers, hospitals, physicians and other health care groups spent $35.7 million last year in lobbying money — the largest non-government lobbying expenditure in the state.

“That’s why this has been unable to make it through the Legislature,” Barbour said. “But I think most Californians will get who’s behind the funding of this [opposition effort].”

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