Universal health care dead in CA: implications

The plan to provide universal health care in CA, a bipartisan effort led by Republican Governor Schwarzenegger and Democratic Assembly Speaker Núñez, was voted down Monday 7-1 in the Senate Health Committee. In the end it faced opposition from both Republicans and Democrats, as well as from powerful special interest groups like the tobacco industry.

Below, some quotes from this summary and brief thoughts on implications.

The bill was killed yesterday by Senate Democrats, who argued that it would burden consumers, dig a deep hole in the state's deficit-ridden budget and provide a windfall to insurance companies. They joined Republicans in a 7-1 vote by the Senate Health Committee against the legislation.

The defeat of a bill that promised to cover 3.6 million Californians illustrates the difficulties of passing a compromise, centrist plan in a polarized Legislature. The vote effectively ends any chance for major health care changes this year.

This result illustrates the importance of being able to overcome political polarization. Even this compromise bill was too hot politically to get through -- Republicans called it a tax increase, Democrats called it an insurance giveaway. Both were partially right, but there were points of agreement too that got lost in the usual partisan posturing. To pass universal health care in any reasonable form will require leadership that can unite liberals, conservatives, and independents behind a solid bill.

Supporters of proposed health system overhaul called the vote a missed opportunity.

"It's incredibly disappointing," said Anthony Wright, executive director of Health Access, a union-backed group that pushes for expanded coverage. "There's millions of Californians who have lost hope for getting coverage."

Health care is an urgent issue, one that impacts millions of Americans every day. It needs to be dealt with on a national level. The next President needs to come to the table with a broad coalition of support in order to pressure involved parties to hammer out an equitable and effective solution. We can't afford to let this chance slip away because opponents of reform are able to demagogue against it with cries of "socialism!" -- we need this effort to be led by someone who will be relatively immune to such smears.

Schwarzenegger wanted to fix a broken system that has suffered from soaring insurance premiums, a growing number of uninsured and increasing congestion in the state's emergency rooms.

[...]Schwarzenegger and his allies cobbled together a coalition that included consumer groups, the AARP, Safeway and other large corporations. He could never persuade GOP lawmakers to join because of their opposition to taxes.

Let's be honest, any universal health care proposal is going to be characterized as a tax increase by opponents. Schwarzenegger tried to sidestep the inevitable accusation by saying Californians currently pay a hidden tax by subsidizing the cost of the medical treatment received by uninsured persons visiting the ER. This didn't go over well with the GOP, but it illustrates the correct approach to such charges: discuss the current costs of our broken system when opponents say that reform will be too expensive, and point out the future savings in both human and economic terms.

Even some sympathetic to the plan suggested the initiative could have lost by a large popular vote, which they feared would set back the cause of health care reform.

Democratic political consultant Garry South said he isn't surprised that Democrats defeated the plan because many distrust insurers.

"The fatal flaw in this thing was requiring people to buy health insurance without controlling the costs of a policy," South said. "That could be a windfall for insurance companies."

Two points here. First, failed attempts to pass health care reform hurt that cause. They make it appear that there is insufficient support, when in fact polls show that Americans desperately want health care reform. They make it appear that special interests cannot be defeated, when in fact a broad political coalition would overwhelm and rebuff the targeted influence of their lobbyist dollars. They make it appear that those proposing reform don't really know what they're doing, undermining confidence in future attempts. We can't afford another costly failure.

Second, mandatory coverage is not sufficient. Policies have to be affordable or the plan will simply compel working Americans to spend money they don't have.

There are some useful lessons for us, as we go forward and attempt to change health care on a national level, in what happened recently in California.

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We have been privileged to have three strong candidates running on three strong plans for universal health care, and I want to particularly acknowledge Edwards' role in emphasizing this issue. Here is a speech by my preferred candidate that I believe indicates he can deliver health care reform, that he understands the most important challenges and that he possesses the political skills to make this happen:

We have reached a point in this country where the rising cost of health care has put too many families and businesses on a collision course with financial ruin and left too many without coverage at all; a course that Democrats and Republicans, small business owners and CEOs have all come to agree is not sustainable or acceptable any longer....

Today I want to lay out the details of that plan - a plan that not only guarantees coverage for every American, but also brings down the cost of health care and reduces every family's premiums by as much as $2500. This second part is important because, in the end, coverage without cost containment will only shift our burdens, not relieve them. So we will take steps to remove the waste and inefficiency from the system so we can bring down costs and improve the quality of our care while we're at it....

when I'm President, we're going to make drug and insurance companies compete for their customers just like every other business in America. We'll investigate and prosecute the monopolization of the insurance industry. And where we do find places where insurance companies aren't competitive, we will make them pay a reasonable share of their profits on the patients they should be caring for in the first place. Because that's what's right....

The time has come for affordable, universal health care in America.

•  Tips for health care reform

  by brendanm98 on Wed Jan 30, 2008 at 10:19:20 AM PDT

  •  CNA response today to the plan:

    they said it so well:

    The Lessons of Failed CA Healthcare Reform
    AB1x: Bad for Organized Labor and Working People
    AB1x was marketed as a model for national healthcare reform. But the plan had serious failings on access, quality, and cost that were especially dangerous for working people - and an important reminder of what to avoid in future healthcare reform proposals. Here's a Top 10 list of AB1x's problems:

    1. Employers would have had strong incentives to drop or sharply reduce union-negotiated benefits. Large employers like Wal-Mart would have received corporate welfare for dumping employees into the public pool.

    2. Forced individuals to purchase insurance policies without knowing the real cost or what coverage they would have received and let employers off the hook from providing benefits.

    3. No restrictions on increases in premiums, co-pays, or deductibles. No meaningful cost controls on rising costs, making the supposed affordability protections meaningless.

    4. Workers would not have known what benefits they were getting - the insurance industry would have been in charge. Failed to identify covered benefits for the minimum plans which were likely to be bare-bones HMO plans without dental, vision, mental health, long-term care, and other essentials - all of which would have cost extra.

    5. Managers could have gotten better benefits than workers. As long as employers paid a minimum amount to a state pool for bargain-basement healthcare, employers could have gotten rid of all benefits for unionized employees.

    6. Instead of providing real benefits, employers could have met their coverage obligation by spending money on "wellness programs," gym memberships, or health savings accounts. Employees who declined that "offer" of coverage would then have been ineligible for the public subsidized pool and have had to buy private insurance policies on their own.

    7. Part-time employees did not have to be offered benefits, and employers could have misclassified workers as "independent contractors" and not offered them even the minimal coverage offered full-time employees. Union trust funds would have been undercut by the low employer mandate because the cheap plan become the new ceiling - no employer would want to pay for better benefits.

    8. Workers who did not get benefits faced harsh penalties if they did not buy insurance, including garnishment of wages or mortgage liens, but there were no penalties for employers who did not comply.

    9. Once employers eliminated their union benefits and workers were forced into a poorly financed state HMO, the funding source for that HMO was not sustainable. The funding in part was tied to a tobacco tax, so if fewer people smoked, there was less money for the plan. Other sources were equally shaky - like a fee on hospitals that ended in five years. The state legislative analyst projected a $3.9 billion dollar shortfall.

    10. The levels of care that people received would have been different. Hospitals where wealthier people get care would have received more money while public hospitals would have been undercut because they would have lost patients, while counties would have paid up to $1 billion in new unfunded costs for the uninsured.

    CNA press release

    by ca democrat on Wed Jan 30, 2008 at 10:34:06 AM PDT

•  Mandatory coverage is ridiculous on its face.

  To mandate coverage seems to imply there are a lot of people who don't have insurance simply because they can't be bothered to sign up for it.  The CA Dems are right to resist that nonsense.

  by I on Wed Jan 30, 2008 at 10:23:58 AM PDT

•  I'm not sorry this dog died.

  I'm firmly behind Universal Health Care.  But this wasn't.  And it was going to just obligate everyone to have insurance.  The great insurance company protection act died.

  That's not bad news.

  What we need is a real health care proposal.

  by ogre on Wed Jan 30, 2008 at 10:24:57 AM PDT

  •  But at least we have California to thank (again)

    for pushing an agenda that should be nationwide in scope.  Their failed efforts can help make the national plan better.

    by I on Wed Jan 30, 2008 at 10:29:04 AM PDT

    •  Hell, we may get there yet.

      Perhaps it's time to use the initiative process... something along the line of "California SHALL have and offer universal health care to all citizens and residents..."--leaving it to the legislature to nail down the details, but with the obligation to do so.

      by ogre on Wed Jan 30, 2008 at 11:03:22 AM PDT

•  Some good things HAVE come of this --

  had the Governator been able to push this not so good program through, it would have given him something more to crow about in his upcoming run for the Senate.  He's already claiming he's a peoples governor, and a green governor, although he's not accomplished much in those areas, either.

  Better it die stillborn now in the state house, rather than get presented (as it was planned) for approval by  the voters next election and get publicly voted down and cause a much bigger negative later.

  It was kind of a patchover plan, didn't address fundemental problems of health care, and implementation of a plan at this time would have been underfunded and probably botched badly due to governance failures and recession impact on the overall state budget, and would in no way be expected to serve as a positive role model for other states/federal programs to follow for health care.

  California is a state too big, too populated, too diverse, too burdened with too many intractible problems, and too hard to govern to expect to bring in any 'test' programs of this magnitude and be an unqualified success.  
     Better the basics be illustrated by smaller more successfully lead and managed states and then brought in as proven workable tactics here.  

  by fastwacks on Wed Jan 30, 2008 at 11:28:53 AM PDT