California lawmakers haven't given up on the prickly issue of universal healthcare coverage.
Assemblymen Joe Nation, a Democrat, and Republican Keith Richman introduced a bipartisan bill late last month that would direct all residents to carry a minimum of basic health insurance as part of a sweeping plan to overhaul the state's beleaguered healthcare system.
The Universal Healthcare Act would require every individual to either buy a private policy with a maximum deductible of $5,000 or enroll in a state-subsidized program such as Medicaid, if eligible. Californians would have to submit proof of coverage with their state tax returns; those who failed to comply would either lose their tax refunds or see their wages garnisheed if they weren't due a refund.
Under the bill, a basic benefits package covering catastrophic and preventive care would be designed by state regulators. Regional purchasing pools would be created to let individuals and small businesses buy insurance at discounted group rates, and subsidies would be granted to small employers that cover low-income workers.
The plan would be funded by requiring not-for-profit HMOs, such as Kaiser Permanente and Blue Shield of California, to pay a 2.35% tax on their gross premiums, which for-profit insurers already pay. Large, self-funded employers would have to pay a 2.35% tax on the fees paid to companies that administer their health plans.
"Healthcare is a right, but we also believe it's a responsibility," Nation said. "At one point or another, we're all going to go to the hospital or wind up in an emergency room and need a doctor. The key is for everyone to be a part of that system and for everyone to pay their fair share."
The California Hospital Association said it backs the bill "conceptually" but is waiting to learn more details before taking a formal position. The association supported a similar measure proposed in December 2002 by Blue Shield of California Chairman, President and Chief Executive Officer Bruce Bodaken (Dec. 9, 2002, p. 20). That bill, which would have required employers to provide coverage and individuals to buy it, died in the Assembly in 2003.
"The CHA has long endorsed universal coverage and an insurance mandate on individuals. It's just, how do you get there," said the association's spokeswoman, Jan Emerson.
Emerson said universal coverage would help ease the financial burden on California hospitals. Fifty-one percent of the state's 430 hospitals lost money in 2003 and nine closed last year, partly because of the growing cost of uninsured patients who seek care through emergency rooms, she said.
But like Bodaken's measure, Nation and Richman's bill faces an uphill battle.
Introduction of the bill follows at least two other failed attempts to create universal or near-universal coverage in the Golden State in recent years. Last November, voters narrowly overturned a controversial law that would have required employers to provide insurance for their workers or pay into a statewide pool that would do so (Nov. 8, 2004, p. 8). Another measure that would have created a single-payer healthcare system never made it out of the Assembly. The latter bill was reintroduced last month by Democratic Assemblywoman Sheila Kuehl.
Even Nation said his bill is a legislative long shot. Democrats and some consumer advocates are expected to protest the requirement that individuals buy their own coverage, while Republicans and HMOs will likely fight the proposed tax increase, he said.
The Assembly health committee is expected to consider the Universal Healthcare Act in May, Nation said.
It's part of a seven-bill package, which, among other things, would require Medicaid beneficiaries to use only generic drugs in most cases; order providers to establish electronic medical record systems; and postpone state deadlines for hospitals to retrofit their buildings to comply with new seismic standards from 2013 to 2020.