Cal­i­for­nia Sen­ate Bill 562 would cre­ate the Healthy Cal­i­for­nia pro­gram “to pro­vide uni­ver­sal sin­gle pay­er health care cov­er­age and a health care cost con­trol sys­tem for the ben­e­fit of all res­i­dents of the state” with the catch that “this bill would pro­hib­it this act from becom­ing oper­a­tive until the Sec­re­tary of Cal­i­for­nia (HHS) gives writ­ten notice…that the Healthy Cal­i­for­nia Trust Fund has the rev­enues to fund the costs of imple­ment­ing the act.”  Which means they need Fed­er­al waivers to run their own Medi-Cal and relat­ed pro­gram reim­burse­ment and also receive fed­er­al funds direct­ly for those ser­vices, as well as tax rev­enue, since there will be no pre­mi­ums charged, copay­ments, or deductibles to recip­i­ents of care under the act.  Essen­tial­ly “it is fur­ther the intent of the Leg­is­la­ture to estab­lish the Healthy Cal­i­for­nia pro­gram to pro­vide uni­ver­sal health cov­er­age for every Cal­i­forn­ian based on his or her abil­i­ty to pay and fund­ed by broad based revenue”

What is surprising?

  • That they intend to pay providers on a “cap­i­tat­ed” (fixed fee) basis and that they will some­how be able to nego­ti­ate not just with all hos­pi­tal sys­tems but doc­tors as well. In a lat­er sec­tion it dis­cuss­es pay­ment by fee for ser­vice (which by itself has no means of cost con­trol) “until anoth­er pay­ment method­ol­o­gy is estab­lished by the board”
  • That this includes cov­er­age for Long Term Care – though that is relat­ed to tak­ing over Medi-Cal, demands will be made for improve­ments and thus increased costs
  • “This title does not pre­empt any city or coun­ty from adopt­ing addi­tion­al health care cov­er­age for res­i­dents in that city or coun­ty that pro­vides more pro­tec­tions and ben­e­fits to Cal­i­for­nia res­i­dents than this title”
  • Car­ri­ers seem to dis­ap­pear unless they want to offer cov­er­age that sup­ple­ments what is offered here. The “good news” how­ev­er, is that “the board shall pro­vide funds from the Healthy Cal­i­for­nia Trust Fund (or oth­er funds as appro­pri­at­ed) for a pro­gram of retrain­ing and assist­ing job tran­si­tion for indi­vid­u­als employed or pre­vi­ous­ly employed in the fields of health insur­ance, health care ser­vice plan and oth­er third par­ty pay­ments for health care or those indi­vid­u­als pro­vid­ing ser­vices to health care providers to deal with third par­ty pay­ers for health care, whose jobs may be or have been end­ed as a result of the imple­men­ta­tion of the pro­gram.”  So…everyone in health insur­ance – agents, car­ri­er employ­ees, third par­ty admin­is­tra­tors – will be giv­en train­ing for new jobs, paid for by tax­pay­ers, while an entire­ly new bureau­cra­cy is cre­at­ed, again with tax­pay­er dol­lars, to admin­is­ter the new plan?
  • The pro­gram is allowed to pay for cap­i­tal expen­di­tures incurred by any non prof­it health facilities

The main line – “every res­i­dent of the state shall be eli­gi­ble and enti­tled to enroll as a mem­ber under the pro­gram” and “res­i­dent” is defined as “an indi­vid­ual whose pri­ma­ry place of abode is in the state, with­out regard to the individual’s immi­gra­tion status”

Most of the bill is giv­en over the fun­da­men­tals of gov­er­nance, which include appoint­ment of a gen­er­al board of 9 and then a pub­lic advi­so­ry com­mit­tee with 22 assort­ed members.

That’s it.  Twen­ty pages.  The pro­jec­tion of a $400 bil­lion cost to enact and imple­ment.  Details to follow…but when, how and what will they show?  And isn’t it a polit­i­cal tru­ism that any pro­ject­ed cost will almost always dou­ble when it is a gov­ern­ment project?  Mon­ey which, by the way, Cal­i­for­nia does not have.