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Cal. single payer bill: You can pass it, but can you pay for it?

March 5, 2017

Eric Bauman, a registered nurse who aspires to become the next chairman of the California Democratic Party, says it’s time for California to become a “healthcare sanctuary” by providing universal, state-operated medical coverage.

Citing efforts by a Republican-controlled federal government to repeal Obamacare, Bauman wrote in an op-ed article, “we cannot miss the historic opportunity the moment presents us: enacting single-payer healthcare into California. Let’s take that step and make California a healthcare sanctuary state.”

He thus joins a long-list of California political figures – Democrats, mostly, but also two Republican governors – who long have advocated universal healthcare, similar to that in Canada and many European countries.

How long?

History records that in 1918, the Legislature, with the support of Republican Gov. Hiram Johnson, proposed a constitutional amendment authorizing the state to provide healthcare to anyone who couldn’t afford care on their own.

Nearly 75 percent of the state’s voters rejected the measure, but variations surfaced during the remainder of the century, including several unsuccessful efforts by Republican Gov. Earl Warren in the 1940s.

The 21st century also has seen periodic efforts, including legislation that voters narrowly overturned in a 2004 referendum and two bills passed by majority Democrats that Republican Gov. Arnold Schwarzenegger vetoed.

Repealing Obamacare, without a replacement system, would hit California particularly hard because the state vigorously embraced it to reduce one of the nation’s highest medically uninsured rates.

More than six million Californians have obtained coverage under Obamacare, the majority via the Medi-Cal program for the poor, which now covers more than one-third of the state’s 39 million residents.

The federal government picks up most of the cost for those new Medi-Cal enrollees –well over $15 billion a year – and spends another $4-plus billion to subsidize health insurance for 1.2 million others not covered by Medi-Cal.

Our healthcare expenditures from all sources, including consumers, totaled $367.5 billion in 2016, according to the UCLA Center for Health Policy Research, about $9,400 per Californian.

That makes healthcare, by far, the state’s largest industry. It also is the basis for assertions that California could transition to universal coverage by rearranging those dollars, since our per-capita expenditures already are comparable to, or even higher than, those in single-payer nations.

The two bills that Schwarzenegger vetoed relied on a 2006 study by the Lewin Group, a health care consulting firm, estimating that covering all Californians would cost about $167 billion, nearly half of which could be redirected from existing government programs.

Obviously, as the UCLA study shows, the state’s healthcare spending now is much higher, and were California to also add several million undocumented immigrants to a single-payer system, the costs would jump by perhaps another $25 billion.

The UCLA study also reveals that 70 percent of that $367.5 billion already falls on taxpayers, the vast majority from the federal government. And that is why California probably could not become an independent “healthcare sanctuary,” as Baumann and others wish it could.

It would still hinge on the same Republican politicians who want to dismantle Obamacare being willing to continue spending massively on Californians’ medical care – unless we are willing to backfill federal funds with an enormous state tax increase of some kind.

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