The focus of the testimony was SB 562, a single-payer bill that was approved last year but then shelved. The bill would establish a system by which the state would pay for all healthcare and essentially cut out insurance companies. Taxes would increase, but supporters maintained that would be offset by the elimination of insurance premiums, copays and other costs.
There are some legal hurdles that would make switching to a single-payer system difficult, according to a report from local public news outlet KPCC. The rules that govern the Affordable Care Act, for example, are all federal, so any changes would require negotiation with the U.S. Department of Health and Human Services.
California’s Medicaid program, Medi-Cal, relies on both state and federal funding, and the feds have the final say. Plus, there’s Medicare: It’s a federal program, so California can’t make changes to eligibility, financing or benefits without a thumbs-up from Washington.
There are also a couple of state laws that would make things thorny — such as Prop 4, a 1979 law that limits how much tax money the state can keep. Above a certain threshold, funds have to be returned to taxpayers, and it would require an amendment to the law to make healthcare exempt.
Supporters of the bill, including the California Physicians Alliance, say it would be worth the effort. One of those supporters, economist Robert Pollin of the University of Massachusetts Amherst, told the committee Wednesday that the state would have to raise about $100 million in additional funds to cover the cost of single-payer, but that most in the state would end up paying less for healthcare because insurance-related expenses would be eliminated.
Other supporters include Health Access California, the California Immigrant Policy Center, Small Business Majority and the California Labor Federation.
Opponents of the bill — including the California Chamber of Commerce and the California Medical Association — say there’s no responsible way to pay for a single-payer system.
The committee is expected to produce a report by this spring with recommendations on how to proceed.