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Time to control crippling health insurance rate hikes

Earl "Skip" Cooper | 5/4/2011, 5 p.m.

An important piece of legislation aimed at protecting our families and small businesses from astounding increases in health insurance costs is moving ahead in the state legislature.

All of us need to tell our representatives to pass this important bill right away.

Introduced last December by Assemblymember Mike Feuer (D-Los Angeles), AB 52 would require health plans and insurers to get approval from state regulators, before they can raise healthcare premiums, co-payments, or deductibles. We've all seen the recent horror stories of rates rising so fast--far faster than medical costs--that families and small businesses can no longer afford them.

AB 52, which will be heard shortly in the Assembly Appropriations Committee, finally puts into place reasonable laws to regulate these shocking increases, giving state authorities the same ability to approve or reject excessive rate hikes as the law now allows for car insurance rates.

This bill is good for all Californians, but it's especially crucial for African Americans and all Californians of color. In California, nearly three-quarters of California's uninsured are from communities of color, and 2.5 million low-income uninsured people of color will be newly eligible for coverage because of the Patient Protection and Affordable Care Act--the federal healthcare reform law passed last year. For these people, it is imperative that we keep healthcare affordable.

AB 52 will do this.

Cost is the main reason that so many of our friends and neighbors don't have health coverage.

Many are employed by small businesses, which too often simply haven't been able to afford health insurance for their employees.

According to a 2007 survey, nearly one-third of employees working in businesses with fewer than 10 employees lacked job-based coverage--a number that has almost certainly gotten worse since then.

As of 2009, 58.3 percent of White Californians had health insurance provided by their employers, compared to just 43.8 percent of African Americans and 36.8 percent of Latinos. Nearly one-third of Californians without job-based health coverage live right here in Los Angeles County.

Opponents of AB 52, led--big surprise--by the insurance industry, have argued that the bill would "force health plans to reduce payments to hospitals, doctors and medical providers, harming patients," as Patrick Johnston of the California Association of Health Plans put it in an April 14 San Jose Mercury News column.

That's nonsense. AB 52 wouldn't stop insurers from charging the rates needed to cover the cost of care. It would simply give state regulators the power to say "no" to rate increases that are excessive and unjustified.

Groups that truly represent California consumers and frontline health providers have seen through the spin and are lining up behind the bill. Organizations rooted in communities of color are taking the lead, including the Black Business Association, Black Economic Council, California Black Chamber of Commerce, Greater Los Angeles African American Chamber of Commerce, Latino Business Chamber of Greater Los Angeles, Council of Asian American Business Associations and Asian Business Association, as well as the California Nurses Association, American Diabetes Association and Consumers Union, among many others.

The ethnic business groups, in particular, have recognized how important health insurance rate regulation is to their members. Many of these businesses struggle to compete with companies who can provide health coverage for their employees. Crippled by the cost of coverage, they find it harder to provide insurance and compete for top-flight employees.

This is why so many small business owners and organizations have told us that they want us to fight for this bill. AB 52 will give them financial stability to purchase health insurance for their employees, which in turn, will help their businesses thrive.

Healthcare is a basic human right. AB 52 will help bring it within reach of many more in our community, and help our local businesses grow and prosper.

Dennis Huang and Carla Saporta also contributed to this article.

Earl "Skip" Cooper is president and CEO of the Black Business Association. Dennis Huang is executive director of the Asian Business Association. Carla Saporta is health program manager at The Greenlining Institute.

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