Establishing a single-payer system in California would cost $400 billion — more than twice the size of the state budget — but the steep price tag failed to deter Democrats pursuing universal health coverage.
A study released Monday by the Senate Appropriations Committee staff found that Senate Bill 562, known as the Healthy California Act, would fall $200 billion short even after factoring in $200 billion in existing federal, state and local funding.
That shortfall could be made up with a 15 percent increase in payroll taxes, the study said.
At Monday’s committee hearing, a host of pro-business groups and insurance providers said the bill would devastate the state’s economy, but Democratic state Sen. Ricardo Lara defended the measure and said that a financing plan is in the works.
“Our goal is to bring back a bill to this committee with the financing structure in place so that we can have it fully debated and fully discussed with the opponents and proponents,” said Mr. Lara, the bill’s co-sponsor, saying he would bring it back “once we get more of the details organized.”
Democratic state Sen. Scott Wiener, one of the bill’s co-authors, wasn’t fazed by the $400 billion estimate.
“When you’re talking about something of this significance, you’re going to put it out there and then everyone’s going to take shots at it from 1,000 different directions, and of course it’s huge and hard and it’s a work in progress, and that work will continue,” said Mr. Wiener.
He said the same complaints accompanied other government health-insurance programs such as Medicare and Medicaid.
“If you look at history of health care in this country, it’s always a history of people being treated like garbage when it comes to health care and being sick and not having access, and then the government stepping in and giving people access,” said Mr. Weiner. “And when they do so, they’re told that they’re being called communists and it’s going to destroy everything, but then in the end, people have more health care.”
Far less sanguine was Republican state Sen. Jim Nielsen, who said he thought the bill would be a “disaster.”
“How can you possibly say that this is going to be fiscally prudent for the state of California and not a burden to the state?” asked Mr. Nielsen. “The state’s never gotten anything right in health care, by the way.”
He pointed to the Veterans Administration, saying that, “The care is abysmal. The cost is great. And that’s how government does health care. So now we’re going to get government into being the great guru and dictator of health care.”
California has debate single-payer off and on for 30 years, but the election of President Trump and repeal of the Affordable Care Act has rekindled interest in universal, government-run health care in the deep-blue state.
Single-payer has increasingly become a litmus test for California progressives, who rallied last weekend outside the state capitol and interrupted speakers at the California Democratic Convention in Sacramento.
Vermont passed the first statewide single-payer plan in 2011 but abandoned it three years later, citing the economic impact of the tax increases needed to pay for the program.
Egging on Californians was Vermont Sen. Bernie Sanders, who urged the Democrat-controlled legislature to approve a single-payer system in a speech earlier this month in Beverly Hills.
“Please make my life easier,” said Mr. Sanders in the Sacramento Bee, adding, “The great state of California can send a message that will be heard all over the country and all over the world if you pass single-payer here.”
The bill, which is still before the Appropriations Committee, was approved April 26 on a party-line vote by the Senate Health Committee.
Those speaking on behalf of the bill Monday included the California Nurses Association, Indivisible Sacramento and Health Care for All Californians, while the opposition was led by the California Chamber of Commerce, the California Association of Health Plans, and insurers such as Aetna, Blue Cross and Kaiser Permanente.
So far California Gov. Jerry Brown has been wary of the plan, asking reporters in March, “Where do you get the extra money?”
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