Court’s Rejection of Maryland Reform May Limit Schwarzenegger
The administration of Gov. Arnold Schwarzenegger (R) is evaluating potential implications for his health care reform proposal arising from a federal court ruling overturning a Maryland health care law earlier this month, the Sacramento Bee reports.
The Maryland law would have required employers with more than 10,000 workers to spend at least 8% of their payroll on employee health benefits. Wal-Mart would have been the only employer subject to the law.
The governor's plan would require employers with more than 10 workers to provide insurance or contribute 4% of their payroll into a state fund.
However, legal experts say the provision conflicts with the federal Employee Retirement Income Security Act, which pre-empts state law. A federal appeals court earlier this month found that Maryland's law to require employers with more than 10,000 workers to spend more on health care conflicted with ERISA.
Kim Belshé, secretary of the Health and Human Services Agency, said Schwarzenegger has asked his attorneys to review the Maryland court ruling.
Daniel Zingale, a senior administration official, said the Maryland case is different from the governor's proposal, because in Maryland, the law required businesses to provide coverage. "In the governor's proposal, (there's) an option for businesses not to offer coverage at all but simply to pay the 4%," he said (Rojas, Sacramento Bee, 1/31).
Schwarzenegger's "failure to attack the costly and inefficient private insurance system to which he wants to graft his fixes almost assures that the [health care] mess will continue," Peter Schrag writes in his Sacramento Bee column. "We could be developing ... an efficient single-payer health system," according to Schrag. "Instead, we tinker at the margins and pretend that we can fix it all for nothing," Schrag concludes (Schrag, Sacramento Bee, 1/31).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.