Mike Kreidler, Washington state's current insurance commissioner, has a big job. Kreidler is responsible for overseeing a department that both protects consumer interests in Washington's insurance industry and regulates the industry itself. He was elected to the position, a four-year term, in 2012 with 54.6 percent of the state's vote. The next runner-up had just 21.8 percent.
The results of that election would be void under a new bill being debated in the state Legislature. That bill, introduced by Sen. Randi Becker, R-Eatonville, last week, would strip Kreidler of his position, replacing him with a Legislature-nominated board and a board-appointed insurance director who would oversee Washington state's entire insurance commissioner office starting January 1st of 2015.
On Monday, Becker's bill was brought before the Senate Health Care Committee (of which Becker is the chair). Kate Nichol, a private citizen from Bothell, was its sole supporter, testifying that the commissioner's office did not respond to a concern about her family's prescription coverage disappearing.
Meanwhile, the AARP, the Washington State Labor Council, the Service Employment International Union Local No. 775, the American Cancer Society and the Washington State Association for Justice all testified in favor of keeping Washington's insurance commissioner. An elected insurance commissioner, they argued, is directly accountable to voters, while a board nominated by legislators is not. Representatives also worried that a 10-person board would dilute accountability.
"The bill, as currently written, would have the [director] responsible to an unelected board," testified AARP lobbyist Mary Clogston. Larry Shannon, lobbyist for the Washington Association for Justice, said insurance companies are not covered by anti-trust laws, and contended an elected insurance commissioner would be the best consumer advocate to deal with that situation.
Becker, who earlier criticized the commissioner's office for slow approval of insurance carriers under the Affordable Care Act, said she introduced the bill because some people don't believe the insurance commissioner's office is listening to them. A board nominated by legislators, she said, would be more receptive.
"This bill will cause a lot of people a lot of grief. Those bill will cause a lot of people joy, depending on what side you're on ..." she said. "This, to me, will create an environment where people will have. ... a broader sense of representation."
While he did not testify Monday, Kreidler, who is currently serving his fourth four-year term, contended last week that an insurance commission board would limit the office's public accountability: Insurance companies cannot legally donate to the campaigns of insurance commissioner candidates, but there is no such rule about Washington state legislators.
In a news release on Monday, Kreidler argued that Becker's bill "is tailor-made for the insurance industry to have its way with consumer protections at the expense of the public." "This bill," he wrote, "creates an insurance board made up of members nominated by members of the Legislature and appointed by the Governor. The public loses its right to select its own advocate. Washington is one of 11 states with an elected insurance commissioner. If the public are not satisfied with the job they’re doing, there’s a referendum on their performance every four years through our democratic process.”
This is the second Senate Republican bill introduced this session that would purge a regulatory entity and replace it with a Legislature-selected board. Sen. Sharon Brown, R-Kennewick, submitted a bill that would replace all current members of the Public Disclosure Commission — currently appointed by the Governor — with a five-person board. Of the five members, four would be appointed by the Legislature and the fifth would be selected by the first four members.
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