Press office, Gov. Arnold Schwarzenegger
When Gov. Arnold Schwarzenegger signed two laws establishing a health reform exchange Friday, it was a historic moment.
It was also, more subtly, a defiant moment, as the governor drafted into law concepts that some health insurers and the California Chamber of Commerce bitterly opposed.
On Tuesday, the Chamber of Commerce ran a full-page ad [PDF] in the Los Angeles Times, urging Schwarzenegger not to sign the law. “The devil’s in the details,” the ad said. “We respectfully ask you to veto AB 1602 and SB 900.”
The ad, also signed by California Taxpayers' Association and the National Federation of Independent Business, said the bills would levy fees on the cost of the health care exchange that would be passed to patients. And it would operate with virtually no oversight, the ad says.
Anthem Blue Cross, for its part, had another set of objections that I wrote about in August.
Anthem was not happy with language in the proposed laws that would grant the five appointed board members leading the exchange the power to negotiate. Their role would be to bargain with insurers for the best possible package of benefits – at the best price – for those who use it.
The law also required insurers to offer the same negotiated policies to people on the individual insurance market.
According to an analysis of SB 900: "Anthem asserts that setting rates in the exchange would likely politicize the rate-setting process, which has proven to lead to insurer insolvency and insurers withdrawing from the market, reducing choices for consumers."
And the California Association of Health Plans, which represents major health insurers in the state, took issue with several aspects of the laws.
One, association vice president Charles Bacchi told me, was a concept that no representatives of health insurance companies should be part of the board that negotiates for the rates.
“We believe if there are other stakeholders on board, we should be treated like any other stakeholder,” Bacchi said in August.
The laws passed, though, specifying that no health provider, representative of a health insurer or anyone with a financial stake in the health game can be on the board. That would leave retired doctors, regulators, academics and consumer advocates as key players, most likely.
It’s unclear how close the law came to tanking, though the Sacramento Bee reported that President Barack Obama himself called Schwarzenegger on Wednesday, urging him to sign.
All told, Friday was a triumphant day for the governor, who fondly recalled his early efforts to pass similar laws in California during a bill-signing ceremony in Los Angeles.
“We said, ‘we'll be back.’ We said, ‘We'll be back …’ I knew that the momentum that we created and the movement we started would not fade away,” the governor said, according to a transcript.
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