Sen. Ricardo Lara deserves credit for delving into the complex reality of health care.
But for now, his prescription, a California-only universal health care system, looks less like a salve for the repeal of the Affordable Care Act than a political rallying cry – and a fiscal fantasy.
The Los Angeles-area Democrat’s Senate Bill 562 fails to answer the most basic reality-based questions, such as how the state, employers and health care consumers would pay for a single-payer, government-run health care system.
Advocates for a California-only single-payer program must have swallowed hard Monday when they read a legislative staff report that placed the annual cost at $400 billion, given that the entire $184 billion state budget wouldn’t cover even half of that.
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Roughly $200 billion of that price tag would come from a new tax, which would be the equivalent of 15 percent of earned income, says the staff report issued in advance of the Senate Appropriations Committee hearing. Some costs to employers and employees would fall, but new spending would be, oh, $50 billion to $100 billion a year.
Lara has support from the city of Los Angeles, Santa Clara and Marin counties’ boards of supervisors, and Insurance Commissioner Dave Jones, a candidate for state attorney general. His most adamant backer is the politically aggressive California Nurses Association, a union that has made single payer its signature issue.
The union’s belief in single payer is a reason why it’s backing Lara’s candidacy for insurance commissioner and Lt. Gov. Gavin Newsom’s run for governor, and why it was all-in for Vermont Sen. Bernie Sanders’ presidential campaign.
As Appropriations Committee chair, Lara has the clout to move the bill through the Senate and Assembly. A final version would need voter approval, perhaps in 2018, when he and Newsom would be on the ballot, too.
But besides the matter of how to pay for it, the bill fails to say how the state, which would be entrusted with managing the brave new health care system, would curb health care costs. As drafted, it would permit patients to gain access to medical services in ways that would be “largely unconstrained.”
In fact, the analysis noted, the “system envisioned in this bill strongly limits the state’s ability to control costs.” Californians would not, for example, need prior approval before seeing specialists, and the analysis adds that health care providers and drug companies would “strenuously” resist any attempt to negotiate lower prices. So the bill also would establish a whole new cause for Sacramento’s already formidable lobby corps.
Then there’s the Achilles heel of many state programs: state computers. Lara’s bill would necessitate digital record-keeping for the health care of 40 million Californians. The state has been attempting for a decade to develop software to track Medi-Cal claims, without success.
Republicans in Congress are playing politics with people’s health care as they contemplate eviscerating the Affordable Care Act. Well-meaning California Democrats need to be careful that they don’t do the same, from the left.
Whatever Obamacare’s limitations, it has helped millions of Californians gain access to care. Before legislators join the nurses union’s effort to revolutionize health care, they need to fully spell out the real world costs and implications of Lara’s proposal. They aren’t close yet.