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State legislators work on bill to establish single-payer healthcare system

on March 16, 2017

As Californians brace for a possible repeal of the Affordable Care Act and the state’s marketplace, Covered California, legislators are working on an alternative healthcare bill that would establish a single-payer healthcare system in the state.

The Healthy California Act, or Senate Bill 562, is a measure that proposes a premium tax towards a public fund, which would finance all healthcare services. State residents would pay into this fund, instead of paying a monthly premium to their insurer for a healthcare plan. The state would collect the tax and pay the insurers directly.

The legislation aims to establish public oversight of insurance cost and care standards, reduce the cost of co-pays and premiums, tackle prescription drug costs and give customers more flexibility in choosing doctors they go to.

With over a million people enrolled in Covered California and more than 10 million on Medi-Cal, the state’s healthcare for low-income people, the possible repeal of the Affordable Care Act puts at risk about 90 percent of Covered California members that rely on federal subsidies to pay for their insurance, according to Sarah de Guia, executive director of the Oakland-based California Pan-Ethnic Health Network.

State Senators Ricardo Lara (District 33, Los Angeles county) and Toni Atkins (District 39, which includes parts of Los Angeles, San Bernardino and Orange counties), who introduced the bill in February, hope the bill might come to the rescue if people start losing their health insurance.

“With Republicans on the brink of rolling back health care, it’s time for California to lead. I look forward to bringing a bill that Californians can support and the governor will sign,” Lara said in the news release issued by Atkins’ office. “We need to have this conversation now while hundreds of thousands of people are speaking out in support of health care.”

But they have had their work cut out for them to push it forward. “We know it is going to be a complicated bill,” said Lara’s communications director, Michael Soller. It has to address whether the Healthy California Act will require mandatory enrollment or be optional for the state’s residents, how exactly rising healthcare costs will be tackled, how much customers will have to pay for the premium tax, and what healthcare services they will receive. In an email, Soller said legislators expect to answer those questions in the process of amending the bill.

Lara and Atkins are advocating for a “principle,” rather than a concrete plan, according to Soller, but hope to introduce a more detailed version of SB 562 to the California Senate in about two months. “By then, we will have a more fleshed-out proposal on how the bill is going to be funded and how it is going to work,” Soller said.

This lack of detail doesn’t sit well with those who are skeptical about single payer healthcare in America. Harold Pollack, a professor in the Department of Public Health Sciences at the University of Chicago, says he has never seen a single-payer bill in Congress that really gave a detailed description of “how we are going to do this.”

Pollack called Senator Bernie Sanders’ single-payer plan, which was an important part of his 2016 presidential campaign, “a lost opportunity—not really a plan, but a thin description of aspirations with very little discussion of how to really get from here to there.”

Pollack also said that with a single-payer system, “the government has much greater leverage on prices to squeeze providers, who are going to fight it tooth and nail.” That is exactly what sank the Affordable Care Act’s public option idea, which faced opposition even from those who supported the legislation.

One of SB 562’s prominent local supporters is Oakland’s City Councilmember at-large Rebecca Kaplan. On March 16, the city’s Rules & Legislation Committee will hear Kaplan’s resolution in support of the bill.

“People should take a look at some successes, using Canada and other places, and understand that this is not a scary idea, and it has been very successful throughout the world,” Kaplan said, referring to the Canadian publicly-funded healthcare system established in 1984. Taiwan, the United Kingdom and Spain have similar health care systems.

“If you look at historical, worldwide comparison, people typically pay thousands less per year for coverage under the single payer system than you do under the American-style system. And you have more access to care,” Kaplan said.

Grassroots pressure to set up a single-payer healthcare financing system in California has been building since the 1990s. Over the last couple of decades, a number of bills made it to the state’s senate floor, but never received enough votes to pass.

Sanders’ campaign for president was largely based on a platform of converting the U.S. healthcare system into the government-run single-payer program, but he faced criticism for underestimating its cost and overplaying its feasibility. 

But the political climate has changed since Donald Trump became president. “With lingering frustration and uncertainty over the future of healthcare, today Medicare for All [single-payer health insurance] has a better shot,” said Martha Kuhl, a registered nurse at UCSF Benioff Children’s Hospital in Oakland and the treasurer of the California Nurses Association, one of the biggest forces pushing the bill forward.

The organization is working with labor unions, health advocates groups and legislators to promote SB 562 and educate Californians about how the single-payer system works, according to Kuhl.

When a more detailed version of the Healthy California Act is ready, it will go in front of the state’s Health and Appropriation Committees. If passed, it would move to the Senate floor.

One of the biggest unknowns is how much federal funding could be available to finance the bill and how much is needed from the California budget.

“Maybe we should spend less money on prisons and instead finance health care for all, if federal money is not there,” Kaplan said.

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