The California based organization, Consumer Watchdog, is looking to put a measure on the 2012 November ballot in California that would create a public health insurance option in the state and provide state regulators more control of premiums. From the San Francisco Chronicle:

As Republicans try to make President Obama’s landmark health care law a key issue in the 2012 election, a leading California consumer rights group wants to shift the debate by offering a groundbreaking state ballot measure calling for a public option, a 20 percent rate rollback and tough oversight of premiums.

The initiative, aimed at California’s November 2012 ballot, is being organized by Consumer Watchdog, the Santa Monica group responsible for Proposition 103, the landmark 1988 ballot measure that established regulatory and cost oversight of state auto insurance rates.

If the measure is placed on the ballot, it would likely be one of the biggest, most expensive and most important initiative campaigns in this country in decades. There would be literally billions of dollars at stake, and passage could affect the future of health insurance in American.

The concept of a public option for health insurance polled extremely well nationally throughout the entire health care reform debate despite the massive campaign against.  In a blue state like California, I wouldn’t be surprised if current support for a public option is well over 60 percent. Without a strong campaign against it, such a measure would likely pass easily.  So we’d expect the insurance industry to launch a multi-million dollar campaign to kill the measure.

The industry has much to lose if the state creates a public option. A well structured public option in a big state could potentially gain a large share of the expanded insurance market, particularly if it could avoid discrimination, gather sufficient providers and offer lower insurance premiums. That would mean billions of lost revenue for the private insurance companies in California.   And it would create serious concerns from insurance companies elsewhere in the country that the idea would spread to other states via the ballot.

If a public option measure makes it on the California ballot, the insurance industry would fight it like it was a battle for their very existence. It would be fascinating test to see whether a big spending campaign can convince the people of California to vote against their own health and financial interests.