Time to Revisit (Resist) California SB 562

A few months ago, I wrote an article analyzing the merits of the proposed Healthy California Act a.k.a. California Single-Payer (CA Assembly approved June 1, 2017, as SB – 562). I was somewhat bemused at the prospect of my state approving a piece of legislation that by itself would more than triple the already massive California state budget. I visit you again today, somewhat less amused at the prospect, which I now think is a better than 50-50 proposition.

Imagine, if you will, a free publicly financed health plan that covers 100% of every man woman and child that resides in the state of California, a worthy if probably unattainable goal. According to the California State Senate Appropriations Committee, the price tag for this program would run in excess of $400 billion per year, roughly 3 times the entire (already massive) state budget. Let that sink in for a minute, who exactly supports this bill? The loudest support comes from the California Nurses Association, as an aside, it is beyond me how any clinical provider (nurses, doctors or facilities administrators) could possibly support a change that would essentially make them salaried employees of the state, really no different than DMV employees.

What does this mean to the taxpayers, particularly the very small and dwindling percentage of California taxpayers who already support, among other things, the 13 million+ Medicaid recipients currently on the books? It is estimated that payroll taxes (impacting every working Californian) would require a 15% incremental tax increase just to get this program started. As a preview of what this might look like, a recently a firestorm of protest ensued after implementation of a relatively modest $0.12 per gallon increase at the pumps.

This massive new government entitlement will no doubt strain the historical loyalty of high bracketed taxpayers, those that have grudgingly traded expensive left-leaning entitlement programs, for the aesthetic beauty of the state. It is a very delicate balance that could be inexorably tilted (in the wrong direction for supporters of single-payer), leaving far more recipients than sources.

Even if financial support remained, Medicare/Medicaid level provider reimbursements would very soon dry up or severely curtail access to necessary care. All one has to do is look north of the border to Canada to see the effect of the single-payer approach to healthcare, where the average wait time for a referral to a specialist is 20 weeks (more than twice as long as the same referral was 25 years ago) joint replacements can expect to wait six months for treatment, far longer than clinically reasonable.

Hopefully, sanity will prevail (a very rare thing in Sacramento these days) even Anthony Rendon (state assembly speaker) far from a fiscal conservative, tabled SB 562 saying “this bill is woefully incomplete and plagued by potential fatal flaws” my concern has to do with the emerging support by the leading candidates to replace Jerry Brown, led by Gavin Newsom, who has come out in full support, backed by the powerful California Nurses Association, in pushing for approval by the state assembly and full implementation of this reform by 2019.

I would like to say that the threat of single-payer is a long shot, but with renewed union pressure to have the assembly pass SB 562, the threat is closer today than it has ever been. Invest the time and resources necessary to support local and national insurance trade organizations in defeating this dangerous legislation, or make plans to look into real estate east of Yuma/Reno.

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