Schwarzenegger Vetoes Single Payer Bill

Gov. Arnold Schwarzenegger (R) on Friday vetoed legislation (SB 840) that would have created a state-run, single-payer health system, the San Francisco Chronicle reports (Gledhill/Yi, San Francisco Chronicle, 9/23).

The bill, by Sen. Sheila Kuehl (D-Los Angeles), would have created a 21-member commission that would develop a plan to restructure the payment of health insurance premiums in the state. Recommendations would have been due to the governor and legislature by January 2009.

The bill also would have created a state agency to provide health insurance for state residents. The agency would have been overseen by a health insurance commissioner appointed by the governor. Private medical groups and hospitals would have received payments from the state for services provided.

The measure would not have created a funding system for the program, and the Legislature would have had to approve funding methods under separate legislation (California Healthline, 9/6).

In his veto message, Schwarzenegger wrote, "I want to see a new paradigm that addresses affordability, shared responsibility and the promotion of healthy living," adding, "Single-payer, government-run health care does none of this" (Benson, Sacramento Bee, 9/23).

Schwarzenegger's veto message is available online. Note: You must have Adobe Acrobat Reader to view the message.

In related news, Schwarzenegger has hired two consultants to help him draft a plan to expand health care coverage for the state's six million uninsured residents, the Sacramento Bee reports.

The consultants -- John Ramey, a former aide to Gov. George Deukmejian (R), and Herb Shultz, who worked for Gov. Gray Davis (D) -- are "from polar ends of the political spectrum," according to the Bee. They were hired to develop a plan that does not require the government to be the primary health insurance provider, according to Adam Mendelsohn, Schwarzenegger's communications director.

Mendelsohn said the plan will not provide universal coverage but likely will include "market-based solutions" to drive down health care costs and increase access to preventive care services.

The Bee reports that the "big question" is whether Schwarzenegger's proposal will require employers to contribute to workers' premiums. The governor plans to release a health care reform proposal if he is re-elected.

Meanwhile, gubernatorial candidate Phil Angelides (D) last week released his own health care reform proposal and said he would work to pass legislation that would prohibit HMOs from spending more than 10% of their revenue from premiums on administrative costs and overhead.

Angelides said the bill would reduce health care costs by $4 billion annually and result in lower HMO premiums (Rojas/Benson, Sacramento Bee, 9/24).