California’s Single-Payer Health Care Plan Would Be Costly and Risky

MedizinSingle-payer health care is e a major issue in California’s 2018 gubernatorial election. Democratic candidate Gavin Newsom has strongly endorsed the idea, while Republican candidate John Cox is opposed. Last year, a single-payer bill, SB 562: The Healthy California Act, passed the state Senate but was placed on hold in the Assembly.

SB 562 would replace the current health care system with a state program under which all provider claims are paid centrally with no network restrictions, deductibles, co-pays, or other limitations. One governing body would replace the current array of public and private insurers. Medicare, Medi-Cal, and the Children’s Health Insurance Program (CHIP) would be integrated into the new system.

Proponents of single-payer primarily tout its ability to move the state towards universal coverage. However, California is already fairly close to achieving universal coverage. The June 2017 CDC report states that only 6.8 percent of Californians are uninsured. The other 93.2 percent already have private insurance, Medi-Cal, or gained insurance through Covered California during the Affordable Care Act (ACA) expansion.

Creating a single-payer health care system would be enormously costly, time-consuming, and difficult from a political and implementation standpoint. If achieving universal coverage is the primary goal, existing insurance schemes and government programs could be expanded to cover the uninsured instead. If Medi-Cal coverage is considered insufficient, it could be enhanced without impacting other categories of insurance.

A major argument from proponents of single-payer is the claim that it saves money by eliminating profits and administrative overhead — money that is going to insurance providers. Relative to all health care costs, these amounts are quite small. Most California residents already have coverage either through the government (Medi-Cal or Medicare) or a non-profit provider (Kaiser Permanente or Blue Shield), so profits only enter into the equation for a minority of Californians. Second, SB 562 would remove incentives to control costs, eliminating managed care. As a result, provider charges would probably increase substantially, overwhelming any savings from the elimination of middlemen.

Kaiser Permanente, the nation’s largest non-profit health plan and the insurer for many Californians, is known for its high quality of care and cost-conscious decision-making. A single-payer system would eliminate managed care organizations, and with them, the years of efficiency gains made to eliminate wasteful spending and improve quality. A statement by Kaiser’s CEO last year emphasized the difference between universal coverage and single-payer, mentioning his hesitations with single payer’s outdated fee-for-service model.

Perhaps the most daunting challenge of a single-payer system is the price tag. Analyses estimate that implementing a single-payer system would cost California between $330 billion and $400 billion per year, and there are reasons to believe that these estimates are too low. To put the potential costs in perspective, the entire California state budget for 2018-2019 is $201.4 billion. SB 562 does not provide details about how funds would be raised to pay for single-payer.

Furthermore, SB 562 has no mention of cost control measures, while explicitly saying there will be no co-pays, deductibles, or premiums. It plans to cover all medically necessary care, including medical, vision, dental, hearing, and reproductive services. Other services like chiropractic care and acupuncture would also be fully covered under the new program.

Many other countries have universal health care coverage and better health outcomes than the United States, an argument frequently used in favor of single-payer. However, many of these countries utilize free-market mechanisms that promote cost-conscious decision-making. These include price transparency, fewer regulations, consumer choice, and cost-sharing to prevent overuse of services.

Aside from the fundamental problems aforementioned, there are considerable political and legal roadblocks associated with implementing a single-payer system in California. Assuming that tax increases would be a necessity for funding purposes, a key obstacle would be gaining the two-thirds vote requirement for passing any such increases in the state legislature. Other obstacles include Proposition 4 of 1979, referred to as the Gann Limit, which limits state and local appropriations. Implementation of a taxpayer-funded single-payer system would necessitate repealing the Gann Limit or exempting the new taxes from the limit. Proposition 98, passed in 1988, requires that a certain amount of state tax revenues be diverted toward education funding and taxes for a single-payer system would fall into this category. So, once again, voters would have to approve exempting these new taxes from Prop. 98.

Proponents of the single-payer system believe that the new taxes needed to fund it could be addressed in legislation without requiring voter approval. The California Budget & Policy Center sees this as “very unlikely,” since it would require amending the state Constitution. When it comes to Proposition 98, the likelihood of exempting new taxes is less clear, since it depends on differences between the General Fund and Special Fund, potentially opening the door to a lawsuit.

Much uncertainty exists about the possibility of rolling federal funding into the California Health Fund (a new fund from which the state government would pay all medical expenses). The federal government funds Medicare and most of Medi-Cal, setting or at least influencing eligibility rules. This creates a hurdle to covering undocumented immigrants; federal funds are currently not allowed to finance any of the social services provided to this population.

The combination of the political and legal complications, SB 562’s enormous price tag, and the lack of cost-control measures and long-term funding uncertainties need to be carefully considered by Californians. Vermont tried to implement a single-payer health care system in 2014 but ultimately abandoned it following a myriad of challenges. Vermont had a population of 625,000 residents at the time. California’s is home to nearly 40 million people. Increasing access to health care is a laudable goal, but changes to the system should focus on improving health care outcomes for patients and  improving the quality and affordability of care. Increasing the state government’s role in health care is unlikely to deliver those results.

This article was originally published by Reason.com

Trump Blasts Newsom’s Universal Healthcare Plan for Illegal Immigrants

trump-debatePresident Donald Trump on Friday blasted California Lieutenant Governor and gubernatorial candidate Gavin Newsom for supporting universal health care for illegal immigrants, asking, “What happens if the whole world decides to go to California?”

Speaking at a North Carolina event, Trump said Newsom wants “health care for everyone. He wants everything for everyone. He wants to open up the borders. He wants to take care of everyone.”

“And I was just saying, what happens if the whole world decides to go to California?” Trump continued.

Trump said Newsom’s plan means “they’re going to take care of the whole world.”

“Where do you stop?” Trump asked. “You’re going to take care of a lot of people, but they’re not going to be able to do it for very long because it’s not going to work.”

Earlier this week, Newsom said he would like to extend San Francisco’s universal healthcare plan for illegal immigrants that he ushered in when he was mayor to the rest of the state.

“I did universal health care when I was mayor. Fully implemented, regardless of pre-existing conditions, ability to pay, and regardless of your immigration status,” Newsom said. “San Francisco is the only universal health care plan for all undocumented residents in America. Very proud of that. We proved it could be done without bankrupting the city. I’d like to see that extended to the rest of the state.”

Newsom also claimed on Twitter that offering universal health care to illegal immigrants is “the economically smart thing to do.”

“If we don’t offer coverage to everyone – regardless of income or immigration status – we will still carry the expense,” Newson said. “Universal access isn’t just the right thing to do – it’s the economically smart thing to do.”

This article was originally published by Breitbart.com/California

Bill to Provide Free Healthcare for Adult Illegal Aliens Dies in CA Legislature

MedizinCalifornia Senate Bill 974, which would provide for “full-scope” Medi-Cal health benefits to all illegal aliens, died in the State Assembly after concerns about up to $3 billion in new costs.

“SB-974 Medi-Cal: Immigration Status: Adults” failed quietly in the Assembly’s Appropriation Committee on August 18, despite an effort to save part of the bill by reducing the cost of taxpayer coverage to $200 million by only covering adult illegal aliens 65 years and older.

After the Democrat-controlled California legislature passed “Health for All Kids” (SB 75) in 2016, which extended full Medi-Cal benefits to 200,000 illegal alien children under the age of 19, Senator Ricardo Lara (D-Bell Gardens) promised that he would fight to expand coverage to all adults who would be eligible, regardless of their immigration status.

When Lara introduced SB 974 on April 2, he told Politico that despite President Donald Trump’s crackdown on immigration, California Democrats continue to believe that health care is a civil right for all residents. “California has never waited for the federal government, or for a political climate, to be able to take leadership on a whole host of issues,” he said.

Lara and other California Democrats had been claiming that there would be no added taxpayer burden from SB 974, because California is already paying for poor undocumented adult illegal aliens through emergency rooms across the state.

But the non-partisan California Legislative Analyst’s Office (LAO) examination in May of the financial impacts of SB 974 revealed the cost for extending the coverage to full-scope Medi-Cal coverage for all eligible adult illegal aliens would be $4.74 billion — a $3 billion increase in the taxpayer burden above what is currently provided to illegal aliens through emergency rooms alone. …

Click here to read the full article from Breitbart.com/California

California one step closer to expanding Medicaid for illegal immigrants

Healthcare costsCalifornia is one step closer to expanding Medicaid for illegal immigrants in the state, with legislation from both chambers of the legislature that could reach Democratic Gov. Jerry Brown’s desk.

The California State Assembly last week passed a measure that would expand a current program, introduced in 2015 by Brown, which provided Medi-Cal coverage for undocumented minors under the age of 19. The new legislation, introduced by Democratic State Assemblymember Dr. Joaquin Arambula, expands that program to cover undocumented young adults up to age 26.

“The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions,” the Assembly bill read. “The federal Medicaid program prohibits payment to a state for medical assistance furnished to an alien who is not lawfully admitted for permanent residence or otherwise permanently residing in the United States under color of law.”

Arambula’s bill was initially slated to cover all undocumented adults, but was amended to expand coverage to just young adults under 26 years of age. That bill is expected to be considered in the California State Senate. …

Click here to read the full article from Fox News

CA Democrats Pushing to Give Illegal Adults Full Health Care Benefits

MedizinCalifornia Democrats are reportedly pushing to give full healthcare benefits to illegal immigrant adults, which would mean that the Golden State not only may have to raise taxes but will also be a magnet for even more illegal immigrants.

According to a Monday Politico report, state Senator Ricardo Lara (D-Bell Gardens) is leading the charge by reportedly arguing that “California needs to be a laboratory for social change by taking the lead on progressive causes.”

“We are trying to address the fact that, whether you like it or not, our undocumented community needs the care, and we are paying for it anyway,” he reportedly said.

Politico points out that California Democrats are trying to extend the state’s Medi-Cal program this legislative session to nearly 1.2 million illegal immigrant adults who would qualify for it, and “companion bills in the state Assembly and Senate” have already “passed their respective health committees with party-line votes.”

The cost to expand Medicaid coverage to adult illegal immigrants in California is reportedly projected to cost $3 billion annually.

California Governor Jerry Brown, who extended Medi-Cal coverage to illegal immigrant children in 2015, has not commented on the pending measures but “is required by law to sign or veto bills passed this session by Sept. 30, just five weeks before the midterm elections.”

Political and health analysts are reportedly astounded that Democrats are trying to extend healthcare benefits to illegal immigrants before this year’s important midterm elections, reportedly saying that the measure would give Republicans in California relevance “they would never have before” in an election cycle in which House races in California could decide which party controls Congress.

Paul Ginsburg, director of the USC-Brookings Schaeffer Initiative for Health Policy, told Politico that the proposal would be “fiscally very dangerous” and  Jay Bhattacharya, a Stanford physician and health economist, suggested to the outlet that such a plan would have to be paid for with tax increases.

Bhattacharya also pointed out the obvious—giving full healthcare coverage to illegal immigrant adults will make California, which is already an official “sanctuary” state, even a greater magnet for illegal immigrants.

The illegal immigrant who murdered Kate Steinle, for instance, told authorities that he came to San Francisco after being previously deported five times because he knew San Francisco was proudly a “sanctuary city.”

“If you make a program like this available, undocumented workers in other states might be attracted to California because of this,” Bhattacharya, the Stanford physician, reportedly said.

This article was originally published by Breitbart.com/California

New bill would put state in charge of setting California health care prices

MedizinAssemblyman Ash Kalra, D-San Jose, has introduced a new bill that would put California in charge of setting prices for hospital visits, trips to the doctor and other medical services.

Under the legislative proposal, the state would create an independent agency that would set prices for the health care market – prices that would be based off the current pricing structure for Medicare.

However, there would be a process for hospitals to appeal and argue that certain procedures require a higher rate.

“By building upon existing models, we can establish a transparent process by which increases in health care costs can be kept reasonable while also expanding access to care,” Kalra said at a Monday press conference.

Proponents of Assembly Bill 3087, including major labor groups, argue that it would help control rising health care costs and give consumers more predictability in assessing health care pricing, while opponents, like doctors and hospitals, maintain that it risks decreasing the quality of care and would cause physicians to leave the state.

“No state in America has ever attempted such an unproven policy of inflexible, government-managed price caps across every health care service,” said California Medical Association President Theodore M. Mazer said in a statement. “It threatens to reverse the historic gains for health coverage and access made in California since the passage of the Affordable Care Act.”

California spends about $8,000 per capita on health care every year, totaling around $300 billion, according to the California Health Care Foundation, and it’s a cost that is affecting everything from the state budget, business’s bottom lines and employee paychecks.

“Medical monopolies are the only ones who benefit from skyrocketing prices; the rest of us are paying the price because we have no choice,” Roxanne Sanchez, President of SEIU Local 1021 and SEIU California, said in a statement supporting the bill posted on care4allca.org.

But the overarching concern is that state officials would be making decisions on behalf of patients – raising concerns about rationing, a lower quality of care and longer wait times.

Additionally, the proposal is also being opposed by progressives in support of single-payer, seeing the legislation as just making a dent in a larger problem that needs complete overhaul.

More broadly, it’s just the latest effort to overhaul the Golden State’s health care system. Last March, state Sen. Ricardo Lara, D-Bell Gardens, introduced a bill to create a single-payer model, but the plan stalled in Sacramento after there were few details laid out on how to pay for the “Medicare for all” system.

This article was originally published by CalWatchdog.com

California Democrat lawmakers are working on bills to increase government control over health care

Watch out—the Socialist/Democrat Party of California is using 14 bills, so far, to limit your choice in health care and to use government to control your health care, medical procedures and more.

“Arguing that it would take several years and a lot of heavy political lifting at the state and federal levels to move to a so-called single-payer health care system, the report recommends taking a series of short-term steps to improve coverage, affordability and access while simultaneously studying how to get to universal coverage.

That will lead to at least 14 bills from select committee members, said Cathy Mudge, spokeswoman for committee co-chair Assemblyman Jim Wood (D-Healdsburg). She said that other legislators may introduce their own reform bills.”

Please note there are NO moderate Democrats in this—every Democrat in the Assembly and Senate will support all or most of these bills—those that supported Steve Glazer for Senate and kept him there, will be losing the right of determining their own health care.  People will die because Glazer was a “moderate”.

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California lawmakers are working on bills to lower health costs and expand access

Michelle Faust and Paul Glickman, KPCC,  3/23/18

Key state lawmakers are set to introduce a series of bills designed to lower costs and expand access to health insurance on California’s individual market, following through on a strategy they embraced earlier this month that calls for an incremental approach to reform rather than an immediate push for government-backed universal health coverage.

Much of the legislation is based on recommendations in a report by three independent consultants to the Assembly Select Committee on Health Care Delivery Systems and Universal Coverage. The consultants based their analysis on 30 hours of testimony given to the committee between October and February.

Short-term reforms

Arguing that it would take several years and a lot of heavy political lifting at the state and federal levels to move to a so-called single-payer health care system, the report recommends taking a series of short-term steps to improve coverage, affordability and access while simultaneously studying how to get to universal coverage.

That will lead to at least 14 bills from select committee members, said Cathy Mudge, spokeswoman for committee co-chair Assemblyman Jim Wood (D-Healdsburg). She said that other legislators may introduce their own reform bills.

Lawmakers are still working on the language of most of the bills, said Mudge, but she provided a list that states “the intent and goal” of each one, along with its sponsor:

Bill Sponsor Description
AB 2965 Select Committee co-chair Assemblyman Joaquin Arambula, D-Delano Expand Medi-Cal coverage to all income-eligible adults regardless of immigration status.
AB 2472 Wood Establish a public option.
AB 2416 Wood Increase health plan competition by requiring plans with Medi-Cal contracts to participate in Covered California.
AB 2459 Assemblywoman Laura Friedman, D-Glendale Provide for state subsidies and/or tax credits for those people in the individual market with incomes more than 400 percent of FPL and/or place a cap on the cost of premiums at a percentage of income.
AB 2565 Assemblyman David Chiu, D-San Francisco Provide increased state subsidies for individual market policies for people with incomes between 138 percent and 400 percent of FPL.
AB 3148 Arambula Limit amount of cost sharing for people in individual market plans with incomes between 138 percent and 400 percent of FPL.
AB 2430 Arambula Increase Medi-Cal eligibility for seniors/disabled individuals whose income is between 123 percent of the federal poverty level (FPL) and 138 percent of FPL to create consistency in eligibility and expand coverage to 60,000 seniors/disabled.
AB 2499 Arambula Limit health plan administrative costs by establishing a medical loss ratio (MLR) in statute that assures 85 percent of premium goes to care.
AB 2502 Wood Establish an all-payer claims data base to gather information on the actual cost of services.
AB 2579 Assemblywoman Autumn Burke, D-Inglewood Streamline eligibility to enroll uninsured individuals who are eligible for Medi-Cal, creating an
AB 2597 Arambula Increase availability of primary care physicians by fully funding and expanding the Public Hospital Redesign and Incentives Program in Medi-Cal (known as PRIME)
AB 2275 Arambula Increase accountability for health care quality standards and reducing disparities in Medi-Cal managed care plans.
AB 2427 Wood Addressing profits in Medi-Cal managed care plans.

One of the reports’ recommendations was missing from the list of legislation: the creation of a state health insurance mandate. Wood and Arambula said earlier this month they weren’t ready to back a state mandate, which has the support of Covered California and the California Association of Health Plans.

“Subsidies are more of an incentive than mandates are,” said Arambula.

While acknowledging their strategy is more “methodical” than many activists want, Wood was not apologetic about backing a step-by-step approach.

“Even one small tweak to the system could have huge ramifications to another part of the system,” he said.

The long-term plan

Following the consultants’ recommendation, Wood and Arambula did endorse the consultants’ recommendation to start the hard work of laying the political, legal and financial groundwork for a government-run single-payer system. They’re sponsoring AB 2517, which Mudge said would “provide a road map, with benchmarks, to move California toward a uniform publicly funded health care system.”

The consultants pointed to a number of state and federal legal hurdles to single payer in the short-term. Both Arambula and Wood expressed doubt that the Trump administration would support changing federal rules and laws to allow California to use Medicaid and Medicare dollars to pay for a state-run health care system.

“We can’t do it without the federal resources,” said Wood.

The experts suggested creating a “planning commission” that would work on designing a single-payer system and figuring out how to pay for it.

The select committee was created to look at the issues raised by SB 562, which proposed a Canadian-style single-payer health system for California. It passed the state Senate last spring but never reached the Assembly. Speaker Anthony Rendon shelved it, calling the measure “woefully incomplete” because it lacked details on how to implement or pay for single payer.

SB 562’s main backer, the California Nurses Association, slammed the report’s call for an incremental strategy.

“The report inflates the obstacles to single payer, all of which are a reflection of lack of political will,” Association Executive Director Bonnie Castillo said earlier this month.

Many of the short-term proposals are “a deceptive facade,” she said, “pretending to address the problem.”

They will “do little to address the biggest hole in our healthcare system, the failure to guarantee actual health care, not ‘insurance’ for all Californians, said Castillo.

The Association said it will continue to press the legislature to consider SB 562.

 

The Missing Item in Health Care Discussion — the Tax Code

MedizinAttempts at creating a single payer health care system have stalled so a group of liberal organizations are backing a package of bills to achieve a form of universal coverage. But you can pull out the same label on this attempt that sidetracked single payer—“woefully incomplete.”  They don’t want to say how much this universal health care plan will cost or where the money is coming from.

Sure the state treasury is brimming with unexpected cash and the budget is at an all time high. However, anyone who has ridden the California budget rollercoaster over the last couple of decades knows that flush times won’t last.

Creating new entitlements on health care that provide subsidies as called for in the plan and includes all residents despite legal status has big dollar signs all over it.

The single payer proposal was weighted down with a $400 billion price tag. Even if the new effort would cost a smaller portion of that amount, the health care change would still add billions to state spending.

Tax increases would probably be part of the proposal to cover the cost. It is hard to see how they can be avoided. But, the M.O. of those seeking tax increases generally has been to get support for tax measures by limiting tax increases on someone else — the rich or corporations are favorite targets.

Such an idea just adds another story onto a tax structure built on a wobbly foundation. When the next economic downturn hits, the structure crumbles and many government programs will be gasping for fiscal oxygen, especially the proposed universal health care.

If health care reformers want to create a new way to expand health care coverage, they first better consider thinking about a tax code that will not undercut the economy and at the same time be able to better manage economic pitfalls.

Such a bill doesn’t exist in the proposed healthcare reform package.

ditor and Co-Publisher of Fox and Hounds Daily.

This article was originally published by Fox and Hounds Daily

Assembly wants to spend $1 billion on health coverage for illegal immigrants

California, flush with cash from an expanding economy, would eventually spend $1 billion a year to provide health care to immigrants living in the state illegally under a proposal announced Wednesday by Democratic lawmakers.

The proposal would eliminate legal residency requirements in California’s Medicaid program, known as Medi-Cal, as the state has already done for young people up to age 19.

It’s part of $4.3 billion in new spending proposed by Assemblyman Phil Ting, a San Francisco Democrat who leads the budget committee. Assembly Democrats also want to expand a tax credit for the working poor, boost preschool and child care, and increase college scholarships to reduce reliance on student loans.

They also would commit $3.2 billion more than required to state budget reserves. …

Click here to read the full article from the Sacramento Bee

Covered California to Guarantee Health Insurers’ Profits to Save Obamacare Exchange

covered caCovered California is so desperate to keep insurance companies on its Obamacare exchange that the state plans to guarantee profits to the giant corporations.

Breitbart News reported early this month that despite the annual inflation rate of only 1.6 percent, Covered California is granting healthcare insurers average premium increases of 12.5 percent. But that appears to not be enough to lure insurers to stay on the exchange, if President Trump ends U.S. Treasury “cost-sharing” side payments to insurers that the courts have ruled are illegal.

According to the a study by the non-partisan Congressional Budget Office (CBO), titled “The Effects of Terminating Payments for Cost-Sharing Reductions,” Obamacare exchange insurance premiums will spike by another 20 percent in 2018. Given that 75 percent of Obamacare enrollees received free insurance through Medicaid, the CBO estimates that the U.S. deficit will jump by another $194 billion between 2017 and 2026 as a result.

Obamacare was sold to voters on a promise to slash healthcare insurance premiums by up to $2,500 per family. But new mandatory rules caused insurance premiums to spike by 68 percent between 2010 and 2015, according to the National Association of State Legislatures.

The national average cost of healthcare for a family of four in the United States is now $17,322. But in highly-regulated California, the average family healthcare premium is even worse, at $18,045.

With the tsunami of cash flooding into the health insurance industry since 2010, profits have more than doubled, and the healthcare stock index is up by 251 percent. The industry’s biggest Obamacare winner has been America’s largest health insurer, United Healthcare. With profits more than tripling since Obamacare passed, United Healthcare’s stock is up a stunning 592 percent.

But with concerns that President Trump or the courts will stop making illegal cost-sharing payments, big insurers like Anthem Blue Cross, Aetna and Humana are duping Obamacare coverage for 2018. One of the reasons that United Healthcare’s stock has been hitting a series of new all-time-highs this month is that the company is cutting its Obamacare coverage from 34 states in 2016 to 3 states in 2017, and possibly leaving Obamacare completely in 2018.

With many of the top health insurance industry players jumping ship on Obamacare, Southern California Public Radio reported that the board of Covered California will consider a plan on August 17 that would incentivize health insurers to offer coverage by guaranteeing that for any lack of profit or losses they suffer in 2018, California will guarantee them the right to jack up profits with higher premium increases in each of the following three years.

Covered California is referring the to the plan as an initiative to address market uncertainty over the actions that might be taken by the Trump administration and the courts.

But “[a]n economic system characterized by close, mutually advantageous relationships between business leaders and government officials” is the Oxford Dictionary’s definition of crony capitalism.

This article was originally published by Breitbart.com/California