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NEWS RELEASE
Jan 10, 2000


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Governor Davis's Budget on Managed Care Enforcement Should Be Increased

The Foundation for Taxpayer and Consumer Rights (FTCR) expressed concern today that Governor Davis's budget did not provide enough resources to his newly created Department of Managed Care to adequately police HMOs and managed care companies. The watchdog group said it would urge the legislature to increase the new Department's resources during budget deliberations.

Davis's budget proposes $13.9 million in fiscal year 1999-2000 and $27.9 million for 2000-1. Under Governor Wilson, HMO oversight in the Department of Corporations had a $15.4 million budget -- greatly inadequate to the task, even without new laws enacted in California in 1999.

"A $35 billion industry should be watched by a regulatory agency with a budget commensurate to the task," said Jamie Court, advocacy director for FTCR. "The Department of Insurance has a $120 million budget and guaranteeing health care to patients is at least as important as protecting their cars and homes. There has been no cop on the beat for far too long and with new laws on the books the HMO regulatory oversight budget should expand many-fold to build, train and equip a motivated and effective HMO police force. We will work for such an increase in resources through the legislative process."

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