San Jose Assemblyman Leads Renewed Push for Universal Health Care

To implement single-payer health care, or not to implement single-payer health care?

That’s the question facing state lawmakers after a group of Democratic legislators on Thursday unveiled a package of bills to create a universal health care program called CalCare.

The proposal has already earned better reception than it did last year, when it was tabled without a hearing after lawmakers raised concerns about its lack of a funding source.

Assemblymember Ash Kalra, a San Jose Democrat, is the proposal’s main author.

“Doing nothing is not action," he said."It is, in fact, the cruelest of actions while millions suffer under our watch.”

Democratic Assemblymember Jim Wood of Santa Rosa said Thursday that he will vote to move the bill forward next week when it’s scheduled to be considered by the Assembly Health Committee, which he leads.

Says Wood: “I continue to feel the frustration, desperation, and quite frankly, the anger that many Californians experience in their efforts to access quality and affordable health care. Something’s got to give, so next Tuesday, I’ll be voting for change.”

But the funding source — new taxes — proposed in a separate bill will likely face an uphill battle. Tax hikes must be approved by two-thirds of lawmakers in both the state Assembly and Senate — a tall order, especially in an election year — and a majority of voters to go into effect. And the doctors’ lobby, insurance industry and business groups are already mobilizing against the bill.

Rob Lapsley, president of the California Business Roundtable: This “middle-class tax increase will drive more families into poverty, force more small businesses to close and compel more employers — and jobs — to leave this state.”

Here’s a closer look at how state lawmakers are proposing to pay for universal health care, which state analysts in 2017 estimated could cost about $400 billion annually:

  • A 2.3% excise tax on businesses after their first $2 million in income.
  • A 1.25% payroll tax on employers with 50-plus workers.
  • An additional 1% payroll tax on wages for resident employees earning more than $49,900.
  • A progressive income tax starting at 0.5% for Californians earning more than $149,500, up to 2.5% for people making about $2.5 million annually. (Those rates would also be adjusted for inflation.)

The bills present a conundrum for Gov. Gavin Newsom, who vowed to implement single-payer health care when campaigning for the governorship in 2018.

That earned him the backing of powerful groups like the California Nurses Association and progressive activists — and now they want him to make good on his promise, especially after they mobilized to help him defeat the recall last September. An estimated 3.2 million Californians remain uninsured.

Emily Hoeven is a reporter with CalMatters.

14 Comments

  1. Tax & Spend – It Never Ends with CA Politicians…
    How much of your earned income is a “Fair Share” for CA to take and redistribute?

    No wonder the taxpayers are leaving the Bay Area and CA…

    The middle-class, well-off, & prepared (ie. folks with the discipline to have savings) have the option to LEAVE the Bay Area…

    —————————————
    —— “Data shows San Fran Bay Area, LA both Lost Residents in same year for 1st time (17Dec2021 ABC7news) —–

    “… 56% of Bay Area Residents Plan to Move OUT of the Region in next Few Years, poll finds…”

    “CA reported its 1st ever annual Population Decline …(losing) 182,083 people in 2020.
    …(Dec 17th) the state said it lost 173,000 people between July 1, 2020, and July 1, 2021.”

    A confirmation “…CA’s once seemingly boundless population growth has ended.
    It also shows that, for the first time ever, LA County and
    the 9 SanFran Bay Counties simultaneously LOST Population in the same year.
    Together, those 2 areas account for more than 44% of the state’s nearly 40 million residents and have some of the most expensive housing prices in the nation.”

    “The 9 Bay Area counties, which have a combined population of about 7.7 million, lost roughly 64,000 people.”

    “CA has 10 counties with at least 1 million people, and 7 of them lost population.
    That includes San Diego County, which lost 15,000 people for its first reported annual decline.”

    “Critics blame CA’s High Cost of Living and Increasing Crime.”

    “When you Can’t Afford to Live in some semblance of Comfort or you Can’t Feel Safe,
    those are huge drivers in Quality Of Life,”
    “…….because of CA Public Policy.”

    “CA’s govt is run by Dems,
    and Republicans have routinely pointed to the declining population numbers as proof people are fleeing the state in droves because they are frustrated by the state’s policies.”

  2. Has any thought or work been done on how this would replace Medicare, Medicaid, S-CHIP, VA’s Tri-Care, Indian Health, etc., on all other than federal property?

  3. this dude is full of it

    a way to get in the paper

    no way will this ever happen, certainly not by this middling politician willing to LARP whenever it gets him near a camera

    go back to getting criminals convicted through your incompetence

  4. I for one being pro business am for a STRONG public option plan. Make the system ACTUALLY competitive. The health insurance game has never been designed to be efficient, nor prepared for a Pandemic. This situation has proven it. So I for one open the door for a single payer option, and make the health insurance industry finally have to compete where it counts!

  5. Another terrible idea – and a Black Hole of over-spending for sub-standard care to follow.
    remember
    “We have to pass the bill before we find out what is in it”
    —————————–
    “It is amazing that people who think we cannot afford to pay for doctors,
    hospitals, and medication,
    somehow think that we Can Afford to pay for doctors,
    hospitals, medication AND
    a GOVERNMENT BUREAUCRACY to administer it.”

    ― Thomas Sowell, Knowledge And Decisions
    ——————————–

    ———-Rhetoric Vs. Reality: Americans Oppose Medicare For All Tax Hikes————-

    Polls show that most Americans Oppose Medicare for all once they learn
    it would force Americans to pay Higher Taxes.

    A national poll by the Kaiser Family Foundation revealed that:

    -60% of Americans Oppose it when they learn it would require most Americans to pay higher taxes,

    -70% Oppose Medicare for all when they learn it would “lead to DELAYS getting some medical tests and treatments”

    -60% Oppose it when they learn it would Threaten the already at-risk Medicare program,
    and
    -58% Oppose it when they learn it would ELIMINATE Employer-Provided and other private coverage.

    Polling also shows that a Majority of Americans are SATISFIED with their
    CURRENT Coverage & Care – and they don’t want their choices taken away.

  6. Ca patriot, you expect a group with a financial conflict of interest would be impartial regarding a poll, look at the nature of the answers, the questions were skewed by design to produce the results. That was not a proper poll and even you know it.

  7. I am surprised to see the proposal of funding to be sourced from personal income and business taxes.

    As Prof. Robert Pollin has stressed many times and most recently in Virginia last year(1), simply eliminating wasteful administration — like that of layers upon layers of claims processors — will provide more than enough savings to cover all costs of a single-payer program in its entirety.

    Proposing taxes, such as outlined in Assembly Constitutional Amendment ACA-11, and a recent L.A. Times article(2), is a sure-fire way to make sure that AB-1400 will be quickly laid to rest in its tracks. No majority of voters would ever support that.

    Further, the moderately low income level threshold, approx. $150K per annum, is way too low for even lower middle class residents; California is an expensive state to live, and most residents fall into or slightly above that level. The threshold needs to be seriously higher.

    Lastly, why impose taxes on income, while it is well-known that most of the uber-rich millionaires arrange no income at all (they elect for a salary of, for example, $1/year) in exchange for options, equity, and other assets. How about proposing taxes for the purpose of funding single-payer healthcare on wealth instead?

    Seriously, I fear for the worst for this Assembly hearing. Same thing might happen as with SB-562 when it was tabled, for good.

    Let us pray, and try to get the ship back on course.

    REFERENCES
    (1) “Oh, Say Can You See USPHC*? (* Universal Single Payer Health Care): A National Healthcare Forum Hosted by the FCDC National Affairs Committee Cosponsored by Democratic Committees from Across Virginia”, Sandra J. Klassen. October 7, 2021. https://www.fairfaxdemocrats.org/event/save-the-date-national-affairs-forum-on-healthcare-2/

    (2) John Myers, “Democrats propose California universal healthcare, funded by new income, business taxes,” LA Times, January 6, 2022. https://www.latimes.com/california/story/2022-01-06/democrats-propose-california-universal-healthcare-funded-by-new-income-and-business-taxes

  8. Really? Nice pipe dream.
    “eliminating wasteful administration – like that of layers upon layers of claims processors -”
    And
    In its place Adding layers upon layers of wasteful State Bureaucracy at much higher costs of wages and pensions…

    Start by cutting the State, County and Local payrolls, switching to defined benefit plans and dropping woefully underfunded pensions.. and clean up the States house before trying to take on more ‘business’ in which the state has no business acumen.
    ———————–
    ———– Would CA Healthcare match the Performance of CA Schools?————

    The State of CA (and San Jose) cannot even educate children to a 50% minimum standard – what makes you think they would be able to run a health care system better?

    How do you expect the current & future residents to be able to afford a Livelihood in San Jose or the Bay Area when a Super-Majority of graduates do not even meet Grade Level Achievement?

    The State-Wide averages show that 65% of K-12 graduates of CA Public Schools Do NOT Meet High School Education Standards.

    Many Districts with-in San Jose/ Santa Clara County perform even worse –
    up to 75%-80% below standards.

    State & local solutions have been to Dumb down the education system by
    eliminating “D” & “F” grading,
    limiting AP & Gifted Student programs,
    focusing on so-called ‘Equity’ programs & ‘Woke’ grading
    at the expense of actual learning

    These CA policies Do NOT Prepare Bay Area Students for survival in an ever increasing High-Tech World and Job Market.

    And NO! – More Money for Schools is not the solution.
    Public schools spend on average 80% more per student than private schools.

    What does the future hold for a student of CA Public Education system?
    Why should Taxpayers provide Tuition Free at public 2 year & 4 year colleges?

    ———California Department of Education, Sacramento, CA—————-
    Detailed Test Results for: State of California 2018-2019
    (Don’t even ask about 2020 or 2021 – in which schooling barely existed)

    ———– Mathematics Achievement Level ————-
    Grade 8 Standard Met: 36.6%
    Grade 11 Standard Met: 32.2%

    ——— Reading / Language Arts / Literacy Achievement Level ————–
    Grade 8 Standard Met: 49.4%
    Grade 11 Standard Met: 57.3%

    https://caaspp-elpac.cde.ca.gov/caaspp/ViewReport?ps=true&lstTestYear=2019&lstTestType=B&lstGroup=1&lstGrade=13&lstSchoolType=A&lstCounty=00&lstDistrict=00000&lstSchool=0000000

  9. Paul,

    In many ways I agree with you. Just on the efficiencies available and the overwhelming influence and corruption of the larger pharmaceuticals, we should be rising in the streets and burning down the house of medical industry.

    But you are talking about government being the cure of something government created and actively cultivates. It is at best a pipe dream to think these deep pockets don’t matter more than people to our government.

    The only solution is to take back responsibility for your own health. Don’t be fat, lift heavy weights, walk, live where you can afford to, get married, have children and be engaged with actual people in your neighborhood, partner up with people in your church to pay each other’s medical bills, and organize and mobilize political will to add space in the law for market-based medical services. I have been uninsured here in the US for over 15 years and have paid out of pocket all my expenses for me and my family. My kid broke his leg skiing two years ago and it cost me like $2000, which I would have had to pay even if I was insured.

    The only thing I really need is catastrophic coverage if I get cancer or something, and we just pay for Taiwan HC coverage, and frankly I trust them more than any hospital in the US.

    The government is completely bought and paid for, and they are actively building an army of people dependent on a broken system they created that encourages said dependents to be chronically unhealthy (35% of the SNAP money goes to chips and pop.)

    Take control of your life first, then work the system to allow you more medical control and freedom.

    The government will not save you.

    Just look at the facts.

  10. The governments job is to secure the borders from foreign invasion, build postal roads, deliver the mail.

    Universal in this case seems to mean we must pay for everyone from any country that kicked in the door and planted a flag at our doorstep. We the conquered must pay tribute Cortez and all his offspring
    or they will bring diseases and pestilence to us all.

  11. The only this works is by cutting the insurance companies out of it, they get so much of our health care dollar and don’t actually provide health care. Sadly the health insurance industry is huge supporters of Governor Newsom…so the funding mechanism is unlikely to pass.

  12. “….so the funding mechanism is unlikely to pass.”

    It better Not Pass – the so-called “funding mechanism” is:
    More TAXES,
    More Taxes on the working class,
    More Taxes on the productive segments of society,
    More Taxes on the businesses that provide jobs and drive the economy,
    More Taxes on the sweat, ambition, and efforts of people who Work Hard to Achieve their Dreams.

    Take some Personal Responsibility for yourself and
    Pay your “Fair Share” of Effort to Contributing to a Productive Society.

    ————-
    (ACA 11) in CA would increase taxes by $12,250 per household,
    roughly doubling the state’s already high tax collections,
    to fund a first-in-the-nation single-payer health-care system.

    – 18.05% Top Income Tax rate (U.S. average is 5.3%)
    – Add a new 2.3% gross receipts tax (GRT), (more than 3x the country’s highest GRT)
    – Impose a payroll tax of up to 2.25% atop the highest individual income tax rates

    “Practically doubling state taxes –
    even if the burden is partially offset through state-provided health coverage –
    could send taxpayers racing for the exits.”

  13. In her reporting on CalCare, Emily Hoeven has completely missed the essence of what the legislation would mean. Assembly Bill 1400 (CalCare) is the most comprehensive single payer healthcare insurance plan ever to be introduced in the Californian legislature. Due to statewide activism and organizing, the bill passed the Health Committee of the California Assembly on January 11 and the Assembly Appropriations Committee on January 20. It will be heard in the full Assembly in the next 20 days.

    The passage and adoption of CalCare would mean that the residents of the largest state in the U.S., the one with a population larger than Canada’s and an economy larger than the United Kingdom’s, would join the rest of the wealthy world in creating a healthcare system that makes people’s health–and not business schemes–its objective and its rationale. AB 1400 calls for a public healthcare insurance system that allows every person in California to choose the healthcare provider(s) they want (including those they have presently) anywhere in the state.

    It would mean the elimination of restrictive provider networks, replacing these with a single state-wide network of providers available to all. CalCare would eliminate all premiums, deductibles, co-pays, co-insurance and other out-of-pocket costs, as well as enrollment periods (everyone would be permanently enrolled). CalCare would expand health coverage to include all necessary medical care and procedures including vision, hearing, prescription drug and devices, mental health and long-term care for everyone.

    For the 3.2 million Californians with healthcare coverage at present, it means complete coverage; for the 5 million underinsured Californians (those for whom premiums plus out of pocket costs account for more than one-tenth of household income) it means massive healthcare access and financial relief; for the 31 million insured Californians (including 6.5 million Medicare beneficiaries; 14 million MediCal beneficiaries, it means an expansion of benefits and the elimination of co-payments, as well as the simplification of access and administration.

    (See https://laborcenter.berkeley.edu/undocumented-californians-projected-to-remain-the-largest-group-of-uninsured-in-the-state-in-2022/; https://www.kff.org/medicare/state-indicator/total-medicare-beneficiaries/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D; https://www.dhcs.ca.gov/dataandstats/Pages/Medi-Cal-Eligibility-Statistics.aspx; https://www.chcf.org/publication/2021-edition-medi-cal-facts-figures/#related-links-and-downloads.)

    Everyone reading this should be writing and calling the offices of your Assemblymembers and demanding they vote yes on AB1400. Use this link to write to them (but modify the text of the letter for your city, county or region): https://actionnetwork.org/ letters/tell-your- assemblymember-to-pass-ab- 1400-calcare?source=direct_ link&.

    Use these links to call them: https://findyourrep.legislature.ca.gov/; https://www.assembly.ca.gov/assemblymembers.

  14. If California’s share of total U.S. healthcare expenditures is 11.5%, as estimated in 2014, then such expenditures can be estimated at about $471.5 billion in 2020. That is, fast approaching a half-trillion dollars annually (https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NHE-Fact-Sheet; https://khn.org/news/article/new-single-payer-bill-intensifies-newsoms-political-peril/). This includes all payments by private businesses, households and non-profit institutions for private health insurance premiums, deductibles, co-payments, co-insurance plus direct payments to hospitals, medical professionals, pharmaceutical and medical device companies and other providers. It also includes all public expenditures on behalf of Medicare and Medicaid beneficiaries (including the Children’s Health Insurance Program); the federal subsidies paid for Obamacare private insurance plans; the funds expended by the state, counties, municipalities, public universities and colleges and school districts on directly providing health care services and insuring their employees. Federal, state and local government healthcare expenditures on behalf of Californians accounts for about 70% of all healthcare expenditures in and for the state’s residents (https://pubmed.ncbi.nlm.nih.gov/27845515/).

    Researchers estimate that at least one-fifth of total health care spending in the U.S. is unnecessary or wasted (https://www.chcf.org/wp-content/uploads/2020/01/GettingAffordabilitySpendingTrendsWaste.pdf; https://laborcenter.berkeley.edu/high-health-care-prices-are-the-primary-driver-of-california-workers-health-care-cost-problems/). Applying this ratio to California suggests there are about $94 billion unnecessary expenditures. About 80% of the waste is caused by factors that CalCare (AB 1400) would remedy.

    In particular, the single payer model would vastly reduce or eliminate administrative complexity, pricing inefficiencies, over-treatment, fraud and abuse. By consolidating insurance funding sources and vastly reducing bureaucracy, the single state-administered health trust fund (think of it as a combined, improved and expanded Medicare and MediCal fund) would be able to pay healthcare providers on behalf of all Californians. The trust fund’s size and reach will allow it to unify and standardize fees and prices paid to providers and simplify and streamline the payments system and bureaucracy. That will result in tens of billions in savings each year while expanding coverage to the more than 3 million Californians who are currently uninsured.

    Pooling all the public sector funds spent on healthcare in California would cover about 70% of total expenses. The remainder would come, as pointed out in Ms. Hoeven’s piece, by a series a new payroll, sales and income taxes, all progressively structured. Revenues from those new taxes would be added to the pooled public funds in the single publicly administered CalCare fund (https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202120220ACA11).

    Under CalCare, all private insurance premiums and the vast bulk of all out-of-pocket medical expenses would be eliminated, resulting in massive savings to businesses, households, non-profits and governments across the board. These savings–conveniently and purposely overlooked by the likes of CA Parrot, Empty Gunn, Not Him, the neoliberal Democrats who dominate the political echelon and the commercial media–are larger than the new taxes proposed by CalCare.

    To repeat, CalCare eliminates expenses to businesses, households, governments and non-profits in excess of what they will pay in new, progressively structured and dedicated taxes resulting in a net reduction in total healthcare spending for everyone. Except for the wealthiest households and the largest businesses and corporations–everyone will have real reductions in what they spend on healthcare.

    The vast bulk of the savings (keeping in mind that the single payer system will be insuring about 3 million people more Californians than are now covered by health insurance) are derived from the massive purchasing power of the publicly-administered fund that will be paying for all necessary healthcare for the entire population. That buying power–referred to as “monopsony” power in economics–counterbalances the entrenched selling power–“monopoly” power–of the consolidated for-profit hospital systems (whose profit margins are estimated in the hundreds of percent on invested capital); counterbalances the monopoly power of prescription drug companies and device makers (whose power and patents result in Americans paying 2-3 times what is paid for their products in other countries who have single payer systems); and counterbalances the pricing power of nursing homes and assisted living facilities who charge exorbitant fees, etc. The lower prices obtained are due to the bargaining power of the single payer, just like the bargaining power of present day Medicare, Medicaid and the Veterans’ Administration.

    The other source of savings would be the elimination of insurance company bureaucracies and human resource department bureaucracies of businesses that are presently needed to administer health plans and to interact with insurance companies (including in doctors’ offices). As noted by Richard Ajluni, those bureaucracies add no value whatsoever. Households, businesses (including doctors and other individual health providers), governments and non-profits who now spend an inordinate amount of time, and endure an endless amount of stress, dealing with insurance company adjusters will be able to save time and resources from a greatly simplified system while focusing their energies on keeping people healthier.

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