California's top insurance regulator is backing a state ballot initiative asking voters to give his office the power to approve health insurance rate increases.
Insurance commissioner Dave Jones, a former city and state lawmaker and a former assistant to U.S. attorney general Janet Reno, is trying to build support for the measure, which he says would bring California under regulations similar to those in 37 other states that have a government rate approval process.
As his office and many other state insurance departments prepare for new federal rules and requirements stemming from the Affordable Care Act, Jones is promoting the ballot measure -- one of several already on the docket -- as a fix to what he sees as an ACA loophole, as he hold the Fresno Bee.
If the ballot measure passes, it would give the commissioner the power to challenge proposed insurance rate changes for individual and small group health products (not large group plans), with an appeals process governed by administrative law judges.
As a state legislator, Jones tried unsuccessfully four times to pass a bill giving the insurance regulators rate approval powers, as the Fresno Bee noted. He also spearheaded a 2009 law prohibiting insurers from charging men and women different rates for the same policies.
[See also: NAIC joins insurers in raising age rating, pricing concerns]
The ballot was filed by the California non-profit Consumer Watchdog. The California Finance Director has estimated that the new regulatory process could cost the state perhaps about $10 million a year in administrative costs, which Jones says would be covered in part through rate filing fees.
The issue of rate regulation is starting to get more attention in some states, amid forecasts from insurers and actuaries about the potential impacts of pending age-rating rules and other market pressures.
An Oregon lawmaker recently said he wants to open the state insurance rate review process to consumer watchdog groups. And in New York, regulators announced recently that they negotiated some $500 million in premium savings on behalf of consumers.
Former congressman Jason Altmire, now government affairs chief for Florida Blue, told Healthcare Payer News recently that age rating, if it does lead to price shock for young people, could start a "national discussion."