California legislation set for veto and special session
Recap and Analysis of Yesterday’s Legislative Floor Debates on California Health Care
By Hanh Kim Quach, Health Care Policy Coordinator, Health Access California
California Progress Report
September 11, 2007
The California Senate and Assembly passed historic health care reform legislation Monday… AB 8 (Nunez/Perata).
Yet even before the debate on AB 8 (Nunez/Perata) was finished in the Assembly, Gov. Arnold Schwarzenegger announced — though not unexpectedly — that he would veto the bill and call the Legislature back to work in a “special session” to “keep working until we achieve the kind of historic solution that all of us and the people of California want.”
Sen. Sam Aanestad and other Republican legislators attempted to disparage AB 8 by comparing it with the Massachusetts plan, pointing out that Governor Romney in “running from it.” While AB 8 certainly shares certain features with the Massachusetts plan, one missing provision is glaringly obvious: the absence of any mandate to buy coverage in the individual market. Even for group coverage, AB 8 does not require anyone to have coverage if they can’t afford it. Affordability is explicitly defined in the bill — unlike in Massachusetts. No worker would have to take up coverage if their health care costs — premiums and out-of-pocket costs —would exceed 5 percent of a person’s wages.
Many lawmakers, including Assembly Speaker Fabian Nunez, said AB 8 was California’s opportunity to provide a model for the federal government to implement health care reform. “We have a broken health care system in California and we must do something to fix it now… This health care package will deliver what the federal government has failed to do: to provide all Americans with affordable health care coverage,” Nunez said.
As part of a special session, (Sen. Don Perata said), “we would continue where we left off…”
http://www.californiaprogressreport.com/2007/09/recap_and_analy.html
Comment:
By Don McCanne, MD
This article from Health Access California, a supporter of AB 8, provides an overview of the legislation and the political activity taking place around it. For those interested, it is worth reading.
In a classic example of political irony, Democrats are abandoning their preferred option, single payer reform, in order to reach a compromise with the Republicans and the private insurance industry. They have crafted a model that they believe does not repeat the mistake of the Massachusetts reform program. California Democrats proudly proclaim that they will not require individuals who cannot afford private insurance to be covered by a program that is being inappropriately characterized as universal.
Not one Republican voted for this compromise, and Blue Cross of California is spending a couple million dollars in an advertising campaign opposing reform. So much for compromise. The Democrats have violated the first rule of negotiation. Before they even seriously sit down with the governor, they have removed from the table the most important polices that would bring comprehensive, affordable, high quality care to everyone.
When you read through AB 8, perhaps the most glaring defect is that the authors craft reform around the private insurance model - a model that served us fairly well in the last century, but one that has now become obsolete. Individual private insurance plans that are reasonably comprehensive and include everyone are no longer affordable for the majority of us. The model for this century is a universal risk pool that is equitably funded.
A report released today in Health Affairs stated that the average annual premium for family coverage is now $12,106. With a median household income of $48,200, those numbers no longer work. Do we provide large government subsidies for a majority of us to purchase administratively-inefficient private plans, or do we reduce the benefits of the plans so that the premiums become affordable? The current anti-tax political environment makes the former highly unlikely.
AB 8 will result in an explosion of the fastest growing problem in health care today: underinsurance. Private plans with affordable premiums but inadequate coverage will create financial hardships for precisely those individuals who should be protected - those who need health care.
Most of us who continue to advocate for a single payer national health insurance program have also supported incremental improvements as temporary measures until we can achieve the reform that we really need. But the line must be drawn with AB 8. We need health care financing reform that enables patients to access the health care system without being exposed to financial hardship.
We need a universal risk pool that is equitably funded and efficiently administered so that funds can be redirected to the health care that we need. What we don’t need is false pride in having protected the private insurance industry at the cost of leaving millions of Californians without coverage.