Consumer Watchdog, a special interest group with strong ties to trial lawyers, is gathering signatures to put a health insurance rate regulation measure on the November 2012 ballot. The measure seeks to create a new bureaucracy, funded by insurance companies, to create a new layer of regulations on top of existing state and federal regulations to control health insurance rates.

Physician groups, hospitals, doctors, and small businesses announced the launch of Californians Against Higher Health Care Costs (CAHHCC) to combat the Consumer Watchdog efforts. C. Duane Dauner, president/CEO of the California Hospital Association says that “Consumer Watchdog’s ballot measure is full of false promises and devoid of real solutions. Regulating health insurance rates does not address the underlying demand and utilization forces that drive health care costs. One of the biggest drivers of increasing insurance premiums stems from the chronic underfunding of the Medicare and Medi-Cal programs. When government programs fail to pay the actual cost of caring for their beneficiaries, hospitals and other providers must shift these un-reimbursed costs to private insurers, which drives up premiums. This initiative does not address governmental payment shortfalls.”

Consumer Watchdog is using the initiative precess to open up California medical insurance in the same way that allowed trial lawyers to make millions of dollars off homeowners and auto insurance following successful ballots in the past.

Stay tuned for more.

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