Editorial: Consumer Watchdog should know better

Published: Monday, Apr. 8, 2013 - 12:00 am | Page 13A

One of the little-known provisions in the Affordable Care Act, also known as "Obamacare," is federal grant money for consumer groups to monitor rates set by health insurance companies.

Recently, Insurance Commissioner Dave Jones approved a grant worth up to $88,305 to the advocacy group Consumer Watchdog. Not surprisingly, Consumer Watchdog last week issued a report finding that Anthem Blue Cross is asking for too much in its latest rate request, as the Los Angeles Times reported.

If Consumer Watchdog had stopped there, no one would be raising red flags. But in touting its taxpayer-funded findings about Anthem in a news release, the Santa Monica-based organization also promoted an initiative that will be on the 2014 ballot. Some federal taxpayers undoubtedly will be uneasy knowing their money is being used to help an advocacy group with one of its ballot campaigns.

The news release stated that the initiative "will require health insurance companies to publicly justify and get approval for rate hikes." It also noted that the 2014 ballot measure is "modeled after a successful California law regulating auto, home and other property insurance that has saved drivers $62 billion since 1988, according to the Consumer Federation of America."

The release did not directly state that Consumer Watchdog sponsored the 1988 measure, and is sponsor of the 2014 initiative. Nor did it say that Jones is one of the initiative's main proponents. Jones says he had little choice but to reward the grant, since Consumer Watchdog met the qualifications. He also notes that Consumer Watch has yet to receive any of the grant money, since that will depend on his department's review of the group's report.

That may be so, but Jones should have known that, given his longstanding relationship with Consumer Watchdog, the grant would raise eyebrows. Worse, it gives fodder to foes of health care reform, who will look for any excuse to attack Obamacare.

The initiative would give California insurance commissioners – Jones if he wins re-election next year – power over health insurance companies. It also would grant groups including Consumer Watchdog the power to intervene before the insurance commissioner in rate hike cases, and receive intervener fees.

The initiative may be a fine idea. For far too long, numerous insurance companies found ways to deny coverage to sick people, even as company executives receive exorbitant pay. But as any consumer advocate should know, the public wants recipients of taxpayer money to be careful with those funds -- and not use them for self-serving purposes.

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