A Letter to Dave Jones, California Insurance Commissioner

This is a copy of a letter I sent to Dave Jones, the Insurance Commissioner for the State of California:

Dave Jones

Insurance Commissioner
California Department of Insurance

Dear Dave:

I heard on the news this morning that Anthem has decided to pull out of the small business portion of the upcoming health exchange, "Covered California," and as such, will not be part of the state-run exchange under the legislation known as "ObamaCare." In reading through articles on this topic, it appears that quite a number of insurance companies have opted out of one part of the plan or another. Added to that, several articles have pointed out that the cost of individual plans under the new exchange will actually be priced higher than before. For myself, what little has been released already shows that a plan for which I would be eligible would cost 22.5% more than that same plan costs today. Since I cannot afford the current price, there is no way that I will be able to afford the increased price.

My question to you is, why are you allowing this? We elected you to this office to protect us from the insurance companies that would rip us off, yet you seem to be disinterested in our needs. I would suggest that you implement the following regulations for the new exchanges:

First, any insurance company that offers health insurance and sells any insurance in California must sell on the exchange. This would include both individual and group plans. The only insurance companies that can opt out are those that do not write these policies anywhere. Otherwise, they must offer the plans or leave the state. I seriously doubt that any will leave.

Second, no insurance company can opt out of selling any lines within the state that they offer in other states. This means that if Aetna (as an example) wants to sell any insurance in California, it must continue to offer individual plans here as well. If it stops offering individual lines altogether, then it can stop selling them in California. If it writes individual insurance in any state, it must write it here. (While not actually part of this topic, this would also mean that earthquake insurance must be offered here by any carrier who writes it outside of the state. That would drive down rates considerably.)

Third, your office should do a thorough check of prices for policies on both individual and group levels and come up with an average rate per plan. That rate should be discounted by 40% and that should be the cap of any plan in the exchange. While we commonly refer to this as "ObamaCare" the actual name is the "Affordable Care Act." Insurance rates are entirely too high, which is the main reason why so many of us are without health insurance. The Act mandates that these rates be affordable and it is the responsibility of the state to ensure that they are. Thus far, the state has done a very bad job of this, since most of the rates that have been presented are higher than before.

Dave, we need your help. And you need to do your job. Stand up to the insurance companies. That's what we pay you for.

Sincerely,

Mr. Patt Gavin