California's Prop 45 (Insurer Rate Regulation in Healthcare) Is So Bureaucratic, It Even Scares Obamacare Supporters

This is from Steven Greenhut, writing at Reason:

... Under [the] system [set forth by Proposition 45], intervenors are paid to challenge rate changes proposed by insurance companies, in a process that can take many months to resolve. Obamacare supporters are rightly concerned that if Proposition 45 passes, it will bollix up the fledgling health exchange's ability to negotiate rates. 

Polls last month put the proposition ahead, but with support falling. This black eye for Covered California has reignited interest in the race....

The real battle, as the Los Angeles Times' Jon Healy explained recently, is between Covered California supporters who claim the new exchange is lowering premiums, and Proposition 45 supporters who claim that "insurers are gouging their customers" so Californians need more protection. ...

Nobel-winning economist George Stigler wrote about "regulatory capture," in which regulated industries often exert excessive influence in the agencies that regulate them. 

It certainly applies here, but it seems ironic for Consumer Watchdog to complain about cozy relationships between the insurance industry and the new insurance exchange given its cozy relationship with the current commissioner, Dave Jones. It seems easier for interest groups to control one official rather than an entire insurance exchange. "I don't buy that — not when that official is accountable to the voters every four years," Court told me. I'm skeptical that voters offer enough of a check. 

No-bid contracts [another Covered California fiasco] are problematic, but a bigger problem may be the lack of a truly competitive insurance market in California's highly regulated and politicized insurance industry. I'm no fan of Obamacare, but consider what will happen if California voters add to this convoluted system yet another set of regulations and yet another level of power to one official.