California Democrats must decide Monday whether to advance a bill that would make the government pay for everybody’s health care in the nation’s most populous state, a key test of whether one of their most long-sought policy goals can overcome fierce opposition from business groups and the insurance industry.
A bill in the state Legislature would create the nation’s only statewide universal health care system. It’s still a long way from becoming law, but Monday is the last chance for lawmakers in the Assembly to keep the bill alive this year.
The bill would create a universal health care system and set its rules — but it would not pay for it. There’s another bill that would do that. It has a different deadline and does not have to pass on Monday.
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Still, Monday’s debate will likely be dominated by concerns about cost. The latest estimate says it would cost taxpayers at least $356.5 billion per year to pay for the health care of nearly 40 million residents. California’s total operating budget — which pays for public schools, courts, roads and bridges and other important services — is roughly $262 billion this year.
Earlier this month, Democrats filed a proposed amendment to the state Constitution that would impose hefty new taxes on businesses and individuals to pay for the system. The taxes would generate roughly $163 billion per year, and the amendment would give lawmakers the power to raise those taxes to keep up with costs.
Supporters hope both proposals — the bill to create the system and the bill to pay for it — will move forward together this year. But Monday’s deadline is only on the bill that would create the system. Still, that hasn’t stopped opponents from connecting the two issues.
“A vote for this bill is naturally a vote for the taxes that come along with it,” said Preston Young, a policy advocate with the California Chamber of Commerce who is leading a coalition of 130 companies against the bill. “Health care costs continue to increase, so the tax obligations correlated with it will go up as well.”
Supporters say Californians and their employers are already paying exorbitant amounts for health care through high deductibles, co-pays and monthly insurance premiums. This bill, if it becomes law, would eliminate all of those and replace them with taxes.
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“Sure, there is sticker shock. But there should be sticker shock for how much we are paying now,” said Stephanie Roberson, director of government relations for the California Nurses Association. “What are we getting? People are still uninsured. People are still underinsured. People are going into medical debt. People have to reach tens of bthousands of dollars of deductibles. We’ll eliminate that under this program.”
Right now, lots of people pay for California’s health care system, including patients, insurance companies and employers. The bill before the Legislature would change that to a single payer — the government. If enacted, it would unravel the private health insurance market. Private health insurance would still be allowed, but only for services not covered by the government.
Progressives have long dreamed of a single-payer health system in the U.S., believing it would control costs and save lives. But it’s never happened. Vermont enacted the nation’s first single-payer health care system in 2011, but later abandoned it because of the cost. Proposals in Congress have gone nowhere.
In California, voters overwhelmingly rejected a single-payer system in a 1994 ballot initiative. State lawmakers tried again in the 2000s, twice passing single-payer legislation only to have both bills vetoed by then-Gov. Arnold Schwarzenegger, a Republican. Another attempt in 2017 passed the Senate but died in the Assembly.
This year’s vote won’t be easy, even in famously liberal California. While this bill has the support of some Democratic leaders and powerful labor unions, it has intense opposition from business groups that are pressuring more moderate Democrats not to vote for it.
The bill needs 41 votes to survive on Monday. Democrats have 56 of the 80 seats in the Assembly. But they are missing three of their more liberal members who have recently resigned to take other jobs, leaving little room for defections.
Supporters so far have not gotten a boost from someone they thought would be an important ally: popular Democratic Gov. Gavin Newsom. Newsom campaigned for a universal health care system during his 2018 run for governor. But since taking office, Newsom has focused mostly on expanding access to insurance coverage.
Newsom has said he still supports a single-payer system. A commission he established to study the idea is due to release its report later this year. But Newsom has been silent on this latest proposal ahead of Monday’s deadline.
“What we need right now is support from the governor on this bill,” Roberson said. “We welcome him to make good on his campaign promise.”