Assembly speaker shelves single-payer health bill

SACRAMENTO – Assembly Speaker Anthony Rendon, D-Paramount, an avowed supporter of single-payer health care, nevertheless announced last week that he was pulling the plug on a Senate-passed measure that would create such a system in California.

Rendon, who is holding the bill in committee, was only the proximate cause of AB562’s death. Its fate was sealed after a Senate floor analysis last month pinned its likely cost at $400 billion – more than three times the state’s entire general-fund budget.

“It didn’t make any sense,” Rendon recently told the Sacramento Bee. “It just didn’t seem like public policy as much as it seemed a statement of principles. I hope the Senate takes this chance to take the bill more seriously than they did before.”

According to its bill language, the Healthy California Act would “provide comprehensive universal single-payer health care coverage and a health care cost control system for the benefit of all residents of the state.” The measure would have tossed out California’s myriad systems of private, insurance-backed and government-funded health care and replaced it with a single, government-managed system run by a newly created state agency.

Such a massive change would demand volumes of detailed legislative language, yet the bill itself was remarkably brief and lacking in specifics. It even failed to include any explanation for how it would receive the necessary waivers from the federal government.

The Appropriations Committee analysis concluded the bill would lead to “increased utilization of health care services,” given that all residents would be free to “see any willing provider, to receive any service deemed medically appropriate by a licensed provider, and the lack of cost sharing, in combination, would make it difficult for the program to make use of utilization management tools such as drug formularies, prior authorization requirements, or other utilization management tools.” So all financial bets were off, given an expected – and probably massive – hike in demand.

To fund the $400 billion program, the Appropriations Committee concluded the state would have to raise about $200 billion in new tax revenues. That would mean a new 15 percent payroll tax, with no cap on the wages subject to the tax. Shifting any of those costs from taxpayers to enrollees would be impossible under provisions that prohibit “members from Healthy California from being required to pay any premium” or “from being required to pay any co-payment, co-insurance, deductible and any other form of cost-sharing for all covered benefits.” 

State officials often argue about programs that spend millions of dollars, but had a surprisingly short debate about one that would cost hundreds of billions of dollars. One reason that might be is that Gov. Jerry Brown already had expressed deep skepticism about the measure. “This is called ‘the unknown by means of the more unknown,’” he told reporters in March. It was unlikely he would have signed it, especially given his concern about creating new spending programs. Critics argue that the governor’s public views gave Democrats a free pass to vote for it and assuage their political base while knowing it was unlikely to become law. Rendon’s comments to the Bee certainly give ammunition to those who saw the bill as a half-baked “statement” bill.

Support and opposition fell along predictable and partisan lines. Liberal interest groups, unions and Democratic politicians typically supported the bill, while conservative groups, taxpayer organizations and Republicans opposed it. Some groups expressed views similar to Rendon’s – supporting the single-payer concept but expressing concern about specifics.

The latter, cautious point of view won the day. After all, the bill raised more questions than it answered. It’s unclear how the new system would work or how the new government agency would operate. There are questions about the effects a 15 percent payroll tax would on the economy and jobs creation and about the magnet effect if California created an unlimited, valuable new benefit available to anyone who simply lives in the state. There are questions about federal waivers and how the California system would intersect with federal programs. And that’s just for starters.

Instead of trying to answer those questions thoroughly, the bill’s backers did as Rendon suggested – introduced a measure that stated some principles and goals, but didn’t really explain how the state government might fund them. Given the debate the health care issue sparked at the latest state Democratic Party convention and on the floor of the Legislature, it’s clear that the single-payer issue will be around or a while, regardless of the fate of this particular bill.

Steven Greenhut is Western region director for the R Street Institute. Write to him at [email protected]

16 comments

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  1. Dude
    Dude 28 June, 2017, 11:35

    “That would mean a new 15 percent payroll tax, with no cap on the wages subject to the tax”
    That would take add an ADDITIONAL $26k on top of the already ridiculous taxes that Mexifornia steals from me. I’ll move to Phoenix and have my employee status changed so I can continue to collect my well earned pay and no longer pay ANY state taxes. Then I can tell Governor BrownStreak to take a flying leap and to kiss my Pelosi!!!!

    Reply this comment
    • Dude
      Dude 28 June, 2017, 11:39

      Who would pay $26k a year for healthcare?????

      Reply this comment
      • Sean
        Sean 28 June, 2017, 15:32

        If your household is covered, you already do. The cost of healthcare exceeds $10K per capita in this country and the average household size is 2.6 people. Do the math.
        Of course the money does not come from you all at once. If you have family coverage at work, your coverage is likely already around $15-17K of your earnings with your employer likely kicking in 70 percent but it’s still money you are earning. Then you have to pay out of pocket and deductibles that can easily be $2-3K per year plus you pay into Medicare through a payroll deduction and there are taxes that go to both Medicare and Medicaid. If you have more than 3 in your household. You might be getting a deal. Oh, and wait ’til you see how much of your Social Security will be diverted to healthcare as well, particularly as you get older.

        Reply this comment
    • pcrussell50
      pcrussell50 1 July, 2017, 11:59

      Why wouldn’t you move to Vegas? Phoenix is in Arizona, and Arizona has state income taxes… Not as high as CA, but still something. Nevada has not state income taxes.

      Reply this comment
  2. Terry
    Terry 28 June, 2017, 16:46

    Just think how much it would be if the WHOLE country uses single payer. It should all be abolished as it is not the Govt responbiilty for heath care. If you want Govt healthcare go to Cuba, which Michael Moore claims is great. Or Canada if you do not mind waiting months to see a Dr. And NONE OF THE GOVT elite have to use this program. They have a King program that is not available to the subjects or peons.

    Reply this comment
    • twh99
      twh99 29 June, 2017, 10:23

      Too true.

      Just once I would like to see the politicians eat their own dog food.

      Reply this comment
  3. Ronald Stein
    Ronald Stein 29 June, 2017, 14:48

    WOW, lots of similarities between the unfunded billions of dollars associated with the Pension Plan liabilities of every city and state for those DEFINED benefits programs, and the new Senate Health Care bill, i.e., can we afford the cost of the DEFINED benefits of Medicare in the years ahead? Those are very scary similarities between the cost of DEFINED Pension Plans and DEFINED Medicare plans. How do we fund each?

    Reply this comment
  4. Ronald Stein
    Ronald Stein 29 June, 2017, 14:52

    The good news is that the ever increasing homeless population will get “free” health care with Government-run universal health.

    The bad news is that the increased costs to our citizens will drive more into the homeless and poverty population, and may be a magnet to attract other financially challenged across the country to migrate to California to enjoy our weather and “free” health care that may not be available in their States, which will add more costs to the ones that are paying for the Government-run universal health.

    The unintended consequences of California ranking near the top of business unfriendly states is the burden on the financially challenged of homeless, welfare recipients, and those hovering at the poverty line. Today, nearly a) 25% of Californians 38 million live below the poverty line, b) California has more than 33% of the nation’s welfare recipients, and c) California is home to 12% of the nation’s population, but startlingly 21% of the nation’s homeless population.

    It’s hard to believe that the current health care system medical bills just in California, are the cause of our huge poverty and homeless populations.

    As the 38 million Californians pick up the cost of the Government-run universal health, those financially challenged will continue to fall further behind which will contribute to an almost unrecoverable situation for them. Adding more costs to the high cost of living in California will contribute to more homeless and poverty.

    Reply this comment
  5. Howard Epstein
    Howard Epstein 29 June, 2017, 17:33

    Just as a rose by any other name is still a rose, socialized medicine by any other name (single payer, Medicare for all, etc) is still socialized medicine. Why use the euphemism?

    Reply this comment
  6. Ulysses Uhaul
    Ulysses Uhaul 29 June, 2017, 20:11

    Congress plans on flexibility for the states……California will be ground zero for the Out of State Land Rush ala doomers using Uly’s moving express services!

    Reply this comment
  7. Sammy the Bull
    Sammy the Bull 30 June, 2017, 08:18

    Americans are obsessed with ‘health care’. Or is it just the boomers getting old? Yet just LOOK at us: the fattest, unhappiest, ugliest most appalling human beings on Earth. Go to ANY ‘third world’ country with reputedly ‘substandard’ health care and look at the people. We are over medicated, insanely stressed, zombified and lied to by the tee vee. How about a pay-as-you-go non-system of health care with a low premium/high deductible catastrophic plan for everyone? That’s all you really need.

    Reply this comment
    • ricky65
      ricky65 1 July, 2017, 08:37

      Whoa! —-“we are the fattest, unhappiest, ugliest most appalling human beings on Earth.”
      Speak for yourself, Sammy. Jeez, yet another self hating American. With an attitude like that you must a Democrat.
      Actually, I’m not obsessed with healthcare at all. I’m enjoying my life on a few acres of heaven here in the Sierra foothills.
      Now, I am obsessed with fishing, hunting, traveling and recreating as I see fit.
      Chill….Go see a therapist. It won’t cost too much but your insurance probably won’t pay for it.

      Reply this comment
      • Ulysses Uhaul
        Ulysses Uhaul 2 July, 2017, 12:50

        You’re in Deliverance Country where only clinics in back of convenience stores provide health care.

        Never ever let your hang nails get infeacted Bro-

        Reply this comment
        • ricky65
          ricky65 3 July, 2017, 09:22

          Never a problem. Out here we are self reliant and don’t need big nanny to tell us what to do.
          Get an infection, shoot yourself up with livestock antibiotics from the Tractor Supply. Only ten bucks and no insurance problems.
          Life is good and the gun towers are manned 24/7.
          One never knows when the free loading, rioting hordes might decide to expand their territory from the collapsing urban chaos.
          Doomerville will always survive any pending apocalypse!

          Reply this comment
          • Ulysses Uhaul
            Ulysses Uhaul 3 July, 2017, 23:08

            You’re in bubonic plague country, but drizzling Mountain Dew on any suspicious rash should do ya, but if you get a low grade fever,,,,,,,,,,see one of those MiWuk medicine men and work it off in their sweat houses.

  8. Dude
    Dude 1 July, 2017, 13:20

    Simple, I have family in Arizona.

    Reply this comment

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Tags assigned to this article:
health careJerry BrownAnthony Rendonsingle payer

Steven Greenhut

Steven Greenhut

Steven Greenhut is CalWatchdog’s contributing editor. Greenhut was deputy editor and columnist for The Orange County Register for 11 years. He is author of the new book, “Plunder! How Public Employee Unions are Raiding Treasuries, Controlling Our Lives and Bankrupting the Nation.”

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