California’s single payer bill passes Assembly Health Committee
Wed, 23 Jun 2004
(These two releases were distributed by e-mail and are not currently available by a link, therefore they are presented here in their unedited versions. Please excuse the length of this important message.)
California State Senator Sheila Kuehl
FOR IMMEDIATE RELEASE
June 22, 2004
CONTACT: Sara Rogers 916 445 1353 or Robin Podolsky 310 441 9084
KUEHL’S STATEWIDE HEALTH COVERAGE BILL TAKES HISTORIC STEP FORWARD IN ASSEMBLY HEALTH COMMITTEE
Senate Bill 921, authored by State Senator Sheila Kuehl (D-23) which would
provide comprehensive health benefits to every Californian at no new cost to
California’s general fund, has been passed by the State Assembly Health Committee by a vote of 12 to 5.
SB 921 would create a single, streamlined reimbursement system for medical
care in California that has been projected to save the state about $14 billion dollars in administrative healthcare costs alone. These and other substantial savings make it possible to insure every resident of California with a comprehensive health plan that would include medical, dental, vision, mental health and prescription drug coverage among benefits.
Because SB 921 would cover every Californian, it would offer each patient the freedom to choose among all healthcare providers. Healthcare provision would remain subject to competition and in private hands. The legislation would also require the State of California to use its purchasing power to negotiate directly with pharmaceutical companies to buy prescription drugs in bulk, thus drastically lowering their cost.
“I’m very grateful to my colleagues in the Assembly Health Committee for voting to extend healthcare coverage to every Californian,” said Senator Kuehl. “SB 921 will make it possible for every Californian to keep their health care coverage even if they change jobs; start a business; start a family; continue our education; or travel out of state. Our important relationships with the doctors we trust will not be interrupted. People with undetected chronic illnesses will get the care they need to avert the heartache and economic burden of medical catastrophes. This bill will save our state money and improve the quality of life for all of us.”
Today, approximately 1 out of 5 Californians is uninsured, and, nationally, catastrophic medical illness remains the leading cause of personal bankruptcy. Most uninsured Californians are employed but either cannot afford the medical insurance offered to them at work or are not offered healthcare benefits through their job. Analysts agree that the costs of healthcare are propelled upward by the overuse of emergency room care (the most expensive kind of healthcare delivery) by people who are not insured and do not receive regular medical attention. Doctors and hospitals also report that, as insurance premiums rise in cost, the reimbursements paid by private insurance companies to medical providers are shrinking.
Cost Controls in SB 921 would mean that businesses would not be burdened
with suddenly rising health care premiums; would no longer have the responsibility for negotiating complicated health care benefits packages for
their employees; and would also insure the self-employed.
SB 921 would also relieve doctors and hospitals of the administrative costs
associated with multiple insurance plans. Since all patients will be insured, healthcare providers will not have to worry about uninsured patients being unable to pay for the care they receive. Physicians will have a direct voice in the amount of reimbursement they receive. Those reimbursements will reflect the actual costs, on a regional basis, of providing care, and they will come on time. Doctors, not insurance companies, will be in charge of deciding what is medically appropriate for patients.
SB 921 will be funded with those federal and state dollars already earmarked
for healthcare, along with a means-based, equitable tax. Individuals and
employers will pay into the plan based on what they can afford, not what
insurance companies want to charge. This tax will replace all premiums, deductibles, co-pays and out-of-pocket expenses. For most taxpayers and businesses, this will lead to sizeable savings.
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HEALTH ACCESS UPDATE
Tuesday, June 22nd, 2004
UNIVERSAL COVERAGE BILL PASSES ASSEMBLY HEALTH COMMITTEE
In a boost to the goal of quality, affordable health care for all, SB 921 (Kuehl), a groundbreaking bill to establish a universal single-payer health system in California, was passed in Assembly Health Committee Tuesday. Having passed the full Senate last year, this new vote raises the profile of this comprehensive health reform solution. The vote was not a given: When Senator Sheila Kuehl decided to schedule the bill in this committee a few weeks ago, she did not know if she would get the votes.
SUPPORT TESTIMONY: Senator Kuehl opened her testimony by stating how “very proud” she was to author SB 921. After describing the “perfect storm” crisis in health care, she described that the bill “imagines a system that provides
high quality, affordable health care for all.” Her stated emphatically that “this bill is possible,” pointing to Medicare and the Veterans Administration.
Dr. L. Paul Smith, who practiced and taught at McGill University in Canada
and now is a member of AARP California, followed on that point, stating that “America is no stranger to single-payer health plans.” He mentioned key benefits of such a plan, including universality, comprehensiveness, and consolidated administration, leading to cost effectiveness. Dr. Bill Durston, a Sacramento emergency room doctor also with significant credentials, talked of his personal experiences, both with uninsured and underinsured patients. He also highlighted the significant administrative hassles of the current system.
Dozens of organizations came forward to declare their support, as Senator Kuehl joked, half in fun and full in earnest, “I apologize that there are over 500 organizations in support of this bill.” When closing on the bill, she again stated how she had “never seen anything” like the support SB921 has, and simply said that this the bill “is in the interest of California.”
OPPOSITION TESTIMONY: Opposition witnesses used several arguments. The Chamber of Commerce representative stated “we do not support the concept of universal health coverage.” The Chamber stated their belief that the bill would entail “significant costs” beyond what Californians currently spend, but did not produce research to back up that argument. She referred to the recent Oregon ballot initiatives for a single-payer plan, where 79% of the state voted no. She claimed that SB 921 does “nothing to address the underlying cost of health care.”
A representative of health plans challenged the belief that “in order to get to universal coverage, you must junk the concept of private competition.” He argued that we all rely on vital services, such as “food, clothing, and housing,” which are “delivered best by a private, competitive approach.” Finally, he cited that this was a “danger” in thinking there were “easy options” to the health care crisis, and that instead, there are “very difficult tradeoffs.”
Other business associations railed against “government-run health care,” and
instead argued for health savings accounts and association health plans. Representations of manufacturers pointed out that the bill removes employers
from the “control and cost of utilization of health care,” and the employer would be stuck with “whatever bill that the state sent them.” Health underwriters noted that the United States spends more than most countries with single-payer systems, and “what services will be rationed to reduce our costs?”
LEGISLATOR COMMENTS: Assemblyman Frommer raised concerns that there were “no limits on revenues collected,” “no controls on costs,” and “a Cadillac benefits package.” He also questioned the timing, with the upcoming referendum to repeal SB 2, the Health Insurance Act passed last year. Senator Kuehl responded that she was a co-author of SB 2 and strongly supported its passage and will work to defend it this fall, and that there is no contradiction to support both.
Assemblywoman Goldberg referred to her experiences in Los Angeles with a
health system that is unraveling: “If we don’t do something, nobody will
have health care.” Assemblyman Dymally supported the bill and urged the
people to challenge the monied interests.
Assemblyman Richman stated that he supports “universal coverage” but does
not support a single-payer system, and does not believe the terms are interchangeable. He raised concerns about “no limits what the income tax
would be, the payroll tax,” etc. He cited provider rate reimbursement concerns, citing the low reimbursement in Medi-Cal, another “government run” health insurer. Senator Kuehl responded that she was not surprised that a program directed at the poor is “nickel and dimed,” and the bill seeks to insulate the health plan from the political concerns of the Governor and legislature.
Assemblywoman Wolk stated she would support the bill to “move it forward,”
but had concerns about it being “not cooked,” especially with the lack of
clarity on the revenues to fund the system, and the potential legal challenges. Having lived in other countries, she also has expressed concerns about “the choices and limitations that others live with that would not be put up with here” in America. Finally, Assemblywoman Rebecca Cohn, Chair of the Assembly Health Committee, gave her support, “since everybody has a body,” and each body eventually breaks down.
NEXT STEPS: The bill will not move forward this year. Senator Kuehl will
continue to work to develop the revenue package to fund the health system,
based in part on economic studies are in the works. This will be a challenge: while the tax system to fund this universal health plan would replace the billions Californians currently spend in premiums, deductibles, and other costs, it still would be considered a tax increase and thus need a two-thirds vote. Yet Senator Kuehl has committed to reintroduce this bill next year, and the organizing and advocacy from this session has created a strong base of support to move forward.
For the text of SB 921 and related legislative documents:
http://www.leginfo.ca.gov/cgi-bin/postquery?bill_number=sb_921&sess=CUR&house=B&search_type=email
Comment: This historic action establishes, with no doubt whatsoever, the
credibility of the single payer model of reform. When legislators seriously examine all of the options, the superiority of the single payer model is evident.
Unfortunately, peculiarities of the California legislative process will prevent the passage of SB 921 in this session. California requires a two-thirds vote in both the Assembly and the Senate to pass any measure that involves a tax increase. California’s legislative districting process has established safe districts which allows the parties to nominate ideological extremists. The Republicans vote as a solid block on all tax measures, and they constitute more than one-third of each chamber.
But the significance of this landmark event cannot be overstated. Legislators can learn the complexities of our health care financing structure, and they can identify solutions that would rectify many of the inherent flaws in the system.
This victory should provide an incentive for you to pull out all stops in your efforts to educate your colleagues and the public on the model of reform that will finally bring health care justice to America: a single payer system for everyone.
Please share this message with others who care.
