Single-payer health care could cost Californians $400 billion a year

Healthcare costsSACRAMENTO – During the California Democratic Party convention in Sacramento last weekend, the spiciest news was outgoing chairman John Burton dropping an f-bomb on a group of activists demanding that the party embrace a single-payer health system. It’s not really news when the notoriously foul-mouthed Burton says such things, but the fracas highlighted the pressure party leadership faces to embrace government-run medical care.

Yet the foulest rebuke to advocates for single payer this week did not take place at the convention. It took place nearby at the state Capitol, in the form of an appropriations committee report that found that a single-payer bill working its way through the state Senate would cost more than double the state’s total budget.

Senate Bill 562, which had previously passed the Senate health committee, was placed in the “suspense file” by the appropriations committee on Monday as legislators analyze the huge price tag. They have until the end of the week to move it out of the file, or it will die this year.

The committee made clear the size of the undertaking: “The fiscal estimates below are subject to enormous uncertainty,” it explained. “Completely rebuilding the California health care system from a multi-payer system into a single payer, fee-for-service system would be an unprecedented change in a large health care market.”

The appropriations analysts estimate an annual cost of $400 billion a year, which soars above the projected $180 billion state budget. Of that cost, the committee explained, about half of it would be covered by existing federal, state and local health care funding. That leaves a $200-billion hole, which the committee says could be covered by a 15 percent payroll tax. Even if the calculation includes reduced health care spending by employers and employees, the committee still estimates a $50-billion to $100-billion shortfall.

And, quite significantly, these costs could be understated given the kind of demand that would be created by this system. Its main advocates, Sens. Ricardo Lara, D-Bell Gardens, and Toni Atkins, D-San Diego, view health care as a “human right,” so the system the bill would create would provide nearly unlimited access to medical care. In fact, the Senate health committee report opined that “SB562 will change health care in California from commodity to a right.”

“Under the bill, enrollee access to services would be largely unconstrained by utilization management tools commonly used by health care payers, including Medi-Cal,” according to the committee report. “The ability for enrollees to see any willing provider, to receive any service deemed medically appropriate by a licensed provider, and the lack of cost sharing, in combination, would make it difficult for the program to make use of utilization management tools … . Therefore, it is very likely that there would be increased utilization of health care services under this bill.”

And the committee only is talking about predicted costs. It’s not its job to engage other policy debates, such as those touching on subjects including rationing, waiting lists for services if the demand overwhelms supply and the quality of care. The bill would apply to illegal immigrants, which raise critics’ concerns about the state becoming a worldwide magnet for “free” health care.

The bill is fairly short given the complexity of the subject. But the Mercury News captured the gist of the single-payer approach in a March news article: “Instead of buying health insurance and paying for premiums, residents pay higher taxes. And those taxes are then used to fund the insurance plan — in the same way Medicare taxes are used to provide insurance for Americans 65 and over.”

This bill would put control of health care in the state under the authority of a nine-member panel and essentially eliminate the role of insurance companies – thus replacing them with a government bureaucracy. But the size of the tax bill and state costs even have Democratic Gov. Jerry Brown expressing what the newspaper calls “deep skepticism.”

The analysis makes some other important points. For instance, it’s not clear that the federal government would go along with this, and it is totally discretionary whether the feds would grant the necessary waivers involving Medicare and Medicaid services. The bill’s funding is based heavily on the ability to divert federal funds from those programs.

The analysis also notes, “There are several provisions of the state constitution that would prevent the Legislature from creating the single-payer system envisioned in the bill without voter approval.” In Colorado this past November, voters defeated a single-payer initiative, Amendment 69, with an overwhelming 79 percent to 21 percent “no” vote.

Supporters of the measure claim that it will reduce “waste” by putting all health plans under a single umbrella, thus ending the duplication of multi-plan systems. But critics note that competition is the best way to keep costs low – not putting a system under one giant governmental entity. Advocates see it as a way to ensure proper health care for everyone, but the appropriations report confirms critics’ concerns that such a system could obliterate the state budget and kill job-creating private enterprise because of the high tax bite.

As the Democratic Party protests illustrated, we can expect the debate to become even more acrimonious and obscenity laden as the days go on.

Steven Greenhut is Western region director for the R Street Institute. Write to him at [email protected]

This piece was originally published by CalWatchdog.com

Republicans Favor Subsidizing New Chargers Stadium in SD

San Diego ChargersSan Diego Mayor Kevin Faulconer, San Diego County Supervisor Ron Roberts and Assembly Speaker Toni Atkins, D-San Diego, told a senior NFL executive on Tuesday about the city’s plans to pay for and expedite the building of a new $1.2 billion-plus stadium for the Chargers at the Qualcomm site in Mission Valley. Afterwards, Faulconer’s press conference was upbeat, stressing his optimism that the Chargers will stay in town and not head for Carson and a shared stadium with the Raiders or Inglewood and a shared stadium with the Rams.

But the doubts that have been raised publicly and privately by the Spanos family — the owners of the Chargers — about the the city’s financing plans and expectations of quick environmental OKs appear to have sunk in with the NFL’s upper brass. The league’s executive vice president, Eric Grubman, had a good news-bad news reaction to the meeting with San Diego officials in an email to the Union-Tribune:

Grubman was also positive after the meeting … praising the city for its large team of environmental experts and for giving the NFL a thorough understanding of its accelerated timeline for environmental approvals and a January public vote.

Grubman also said the city’s proposed stadium design has “all the key elements we would expect at this stage.”

But he stressed that the design was only conceptual, no actual negotiations took place on Tuesday and that the financing plan presented by the city includes “very significant funding from NFL and Chargers sources.”

That was a reference to the $400 million to $500 million that the team and the league are expected to kick in for construction and related costs.

Is a mostly subsidized stadium not good enough?

Grubman’s critique prompted a sharp response on social media from some who wondered how the world’s most lucrative professional sports league could gripe about a proposal in which taxpayers bore two-thirds or so of the cost of a stadium for the league.

But as an indication of how NFL Commissioner Roger Goodell and other team owners felt about the Chargers’ interest in moving, it was telling. Past assumptions about the league not wanting to risk a backlash over a moneymaking team leaving a community that had supported it for more than a half-century may have been based on a sentimental view about how the NFL operates.

So where do things go from here? The Union-Tribune’s coverage suggests a meeting in less that two weeks could be absolutely crucial:

[San Diego officials will make] a presentation scheduled for Aug. 10 in Chicago to the NFL’s relocation committee — a group of six team owners overseeing possible franchise moves to Los Angeles.

The day after that presentation, all 32 NFL owners are scheduled to meet in Chicago to discuss how to handle relocations to the Los Angeles area, where the Chargers, Oakland Raiders and St. Louis Rams are working on stadium projects.

How — and how much — does Atkins want to help?

The fact that the San Diego political establishment is not united on the stadium issue came up again Tuesday. The involvement of Atkins in the meeting with Grubman was treated as a huge plus by Mayor Faulconer, but her decision not to join him at the press conference and the vagueness of her confirmed comments led editors of the Voice of San Diego to wonder what help she was actually providing.

On Twitter, VOSD’s Liam Dillon paraphrased her position this way: “Atkins: I’m happy to expedite the mayor’s Chargers plan, but I don’t have a position on the mayor’s Chargers plan.”

An aide to Atkins said she was ready to help the city and the team maneuver through the obstacle course of state environmental rules in building the stadium. But the City Council member whom Atkins appears closest to — former interim Mayor Todd Gloria — is very cool to Faulconer’s stadium push.

So how much Atkins actually wants to do to help keep the Chargers in San Diego is open to question. For now, city Republican leaders appear far more inclined than elected city Democrats to subsidize a Chargers stadium, wherever it is located and however the taxpayers’ share of costs is provided.

CA’s Remarkable and Powerful Gay and Lesbian Political Leadership – What is Next From Them?

For some years Californian’s have given gay and lesbian politicians extraordinary leadership opportunities and power in the state. The power these politicians possess in state government is from stronger positions and relatively larger numbers than that of many other minority groups, including Asian elected officials, in a state where Asians comprise 14% of the population, and they arguably possess more political power than African-American politicians, whose affinity group represents close to 7% of the state population. California’s gay and lesbian elected officials have wielded this power even as those same California voters disapproved gay marriage at the ballot, as in 2008, when just over 52% of voters approved a ban on same-sex marriage.  (The same voters gave Barack Obama over 61% of their votes in the same election.) But times are changing, and California’s highly influential gay and lesbian elected officials, who have been so successful on civil rights issues for the lesbian, gay, bisexual and transgender community, and have worked so hard on issues like same-sex marriage, have surely played a role in the remarkable changes in California public opinion since 2008.  According to a September 2013 Public Policy Institute of California poll (taken well before the U.S. Supreme Court’s decision approving same sex marriage as a Constitutional right), a record high 61% of Californians and 64% of likely voters favored allowing gay and lesbian couples to legally marry, and in apparent remorse for the 2008 vote on Proposition 8, solid majorities of Californians (59%) and likely voters (63%) approved of the U.S. Supreme Court’s earlier decision to let stand a lower court ruling that put a “stay” on Proposition 8′s ban on same-sex marriage in California. One might guess that public opinion in California in favor of same-sex marriage is even more popular today than in PPIC’s last survey.

Who are these notably powerful gay and lesbian leaders? They are almost all liberal Democrats, and have served in responsible leadership positions (some retired only because of term limits) in the last decade and include current Assembly Speaker (the state assembly’s most important position) Toni Atkins of San Diego, the state’s first out lesbian Speaker, and her immediate predecessor John Perez of Los Angeles, the state’s first out gay Assembly Speaker.  Included also are former State Senator Sheila Kuehl from Santa Monica, now serving in the significant position of Los Angeles County Supervisor, current State Senator Mark Leno of San Francisco, the State Senate’s first out gay State Senator and a possible successor for Nancy Pelosi’s Congressional seat,  former State Senator Carole Migden of San Francisco, along with retired State Senator Christine Kehoe of San Diego and retired Assembly member Jackie Goldberg of Los Angeles. Congressman Mark Takano of Riverside is an out gay, as is San Diego County Supervisor Dave Roberts. They are all Democrats and are joined by many more gay and lesbian elected officials throughout the state in other state and local offices.

A few influential gay and lesbian elected officials are Republicans, and they are generally representing southern California constituencies.  Bonnie Dumanis, holding the important office of District Attorney of San Diego County, is a lesbian and a Republican. But Republican gay and lesbian candidates have been less successful at the ballot box than their liberal Democrats counterparts. Carl DeMaio was elected to the San Diego City Council, but he lost close races for Mayor of San Diego and the 52nd Congressional seat to straight Democrats. Kevin James lost his race for Mayor of Los Angeles in 2013, but was appointed after the election to the powerful Public Works Commission. Some gay Republican elected officials have not been “out” about themselves.  In at least one example, former GOP State Senator Ray Ashburn was considered in a published account as a “fierce opponent of gay rights” until he was arrested for drunk driving after leaving a gay nightclub in Sacramento one night, leading to his coming “out” as a gay man. Ashburn’s term ended in the State Senate in 2010 and he lost a shot at a political comeback when he ran for Kern County Board of Supervisors in 2012 and lost. (He had previously served 12 years as a supervisor, before his election to the state Legislature.)

California’s powerful liberal Democratic gay and lesbian elected leaders of course can’t claim credit for the U.S. Supreme Court’s decision, but the result is something they have doggedly and passionately worked on for many years. It is a huge goal to be considered now accomplished. So the question is, what will they do with their formidable power now?

San Francisco Chronicle reporter Carla Marinucci asked more-or-less that question in a recent article. She quotes Rick Zbur, executive director of Equality California, as saying there is growing concern that “we see people coming out of religious communities being very threatened by the advances we made, and we really need to work on that.”  “Here in California,” he said, “we’re still seeing continued attacks by the religious right on the transgender community, and ballot measures by the same right-wing extremists who brought us Prop. 8.”

Zbur’s rhetoric may also be a growing concern. If it was “right-wing” extremists who brought about Proposition 8, they were supported by 52% of the state, the same state that elected Obama in a landslide in the same election.  There should not be growing concerns on the part of the lesbian, gay, bisexual and transgender community given the changes we have seen in California and society in general since 2008. As I said earlier, polling shows a markedly different attitude today among Californians on the issue of same-sex marriage than just seven years ago, and those changes in voter attitudes aren’t just about changes in demographics. They have a lot to do with political leadership in the state. In my opinion, the growing concern for the state is not about what right-wing extremists are going to do, rather, it is about how far California’s supporters of LGBT rights are going to push their advantage into the new realm that will pit personal property rights against discrimination claims in the state.

Housing, employment, insurance, renting, leasing, buying, selling, personal service agreements; all these activities involve personal property rights protected by many of the same parts of the constitution as same-sex marriage now is protected.  It is these activities that will likely become the focus of new state legislative proposals intent on building on the U.S. Supreme Court case and this is where the coming tension between constitutional interests will be at the most important. The constitutionally protected right to privacy will also be an issue, as in efforts by opponents of the so-called “transgender” bathroom legislation adopted by the state in 2013. It will be interesting to see how Californians react in polls and voting on an initiative measure pitting personal privacy rights in a bathroom against the right of a transgender person to self-identify.  But let us be clear: privacy, rightly or wrongly, is not a constitutional right that has held much of a trump card with the U.S. Supreme Court in recent decades, as in The Patriot Act decisions. However, personal property rights have indeed mattered to a continuing majority of the modern court, and California’s gay and lesbian leaders should be very careful about how they play their current winning hand, because pushing too hard might just be seen as an attempt not to address a civil right, but to achieve a favoritism in law, and that could easily become a 5-4 losing hand.

Originally published by the Flashreport

Assembly Democrats Want Real Estate Fees, Tax Credits for Affordable Housing

As reported by KQED:

The leader of the state Assembly is unveiling an ambitious affordable housing proposal, one that could pump more than $600 million a year into  development at the local level.

Assembly Speaker Toni Atkins (D-San Diego) was joined Wednesday afternoon by a wide range of prominent Democrats in Los Angeles, including state Treasurer John Chiang and Los Angeles Mayor Eric Garcetti, to announce her plan. At its center: A proposal to institute a new transfer fee on real estate transactions, one Atkins’ staff characterizes as small; and expanding legislation proposed by Assemblyman David Chiu (D-San Francisco) to increase the tax credit that real estate developers can claim when they build affordable housing.

“The bottom line is that every Californian deserves a stable, safe place to live,” Atkins said.

Click here to read the full story

Atkins Proposes $1.8 Billion Tax on CA Drivers

For the second time in as many weeks Californians got the news that Sacramento politicians are proposing yet another big tax hike.  The truth is that new taxes would never be required were it not for Sacramento’s mismanagement of existing tax dollars.

Last week, it was the proposal to deal with the very real problem of “revenue volatility” in California’s tax structure with the very unreal “solution” of a $10 billion tax on services.

But the latest proposal comes from new Senate leader Toni Atkins who proposes a brand new tax on drivers to pay for highway and road repairs in California.  This new “fee” would take $1.8 billion dollars out of the pockets of hard working California citizens over the next five years.

Now, most Californians would wholeheartedly agree that our roads are in terrible shape.  Years of neglect have resulted in a highway system that, according to a recent state report, requires a massive infusion of $59 billion.  But taxpayers have a very good question that has yet to be answered:  How is it that California has the highest gas tax in the nation and yet cannot keep its roads in decent condition?

Moreover, although the exact nature of this new “fee” has yet to be determined, Senator Atkins’ comments in proposing the new revenue source can only be described as foolish and insulting. Here is what she said:  “California cannot have a strong middle class or a thriving economy if our roadways are congested and people and goods cannot move efficiently.”

Really?  A left-wing politician now claims that this new tax is needed to protect the middle class?  She is simply blind to the truth that the progressive policies of heavy taxation and over regulation are crushing the middle class in California.  As is so common now in California, statements from politicians such as Atkins reveal a profound disconnect between their pampered lives and the lives of ordinary citizens.

So, instead of slamming Californians with another tax hike, what is a better way to meet the funding needs for our crumbling highway system?  Glad you asked.

First, let’s demand that gas tax revenues pay for roads, not bike lanes, environmental mitigation programs and mass transit.  The latter programs are all well and good, but gas taxes should go for roads.  (For purposes of full disclosure, as a cyclist I support bike lanes.  But I don’t want my gas taxes paying for them).

Second, how much of our transportation dollars are wasted on burdensome labor restrictions?  So-called “Project Labor Agreements” add between 25 to 35% to the cost of highway construction. Let’s get rid of PLA’s and, while we’re at it, “prevailing wage” laws which also add to the cost of construction unnecessarily.

Third, let’s direct valuable transportation dollars to those systems that actually work.  This would mean abandoning the doomed-to-fail High Speed Rail Project that is sucking up tax dollars in a way that voters never approved.

Fourth, we can agree that gas tax revenue has fallen a bit short of expectations because cars are now more fuel efficient.  But if that is the case, why does the state still subsidize electric vehicles? Shouldn’t we abandon those subsidies and direct those dollars to filling potholes?

Instead of reflexively demanding higher taxes, our elected officials should do what other states seem to do without controversy – prioritize spending.  Now there’s a novel concept.

Jon Coupal is president of the Howard Jarvis Taxpayers Association — California’s largest grass-roots taxpayer organization dedicated to the protection of Proposition 13 and the advancement of taxpayers’ rights.

Originally published at HJTA.org