Legislative Update

Unwilling to prolong the state budget impasse over an argument involving illegal immigration, Democratic lawmakers this week dropped a $2 million proposal to expand eligibility for Healthy Families to include undocumented children. A proposal by Gov. Arnold Schwarzenegger to allocate $28 million to 18 Healthy Kids programs remains in the spending plan. However, Republican legislators have said they will not support any budget that would allow funds to be used to provide health benefits to undocumented immigrant children.

Other efforts to expand health insurance programs are underway as the second half of this legislative session picks up steam. When the proposal to expand Healthy Families was withdrawn, Senate President Pro Tempore Don Perata said he would introduce similar legislation separately. An initiative to increase the state tobacco tax to fund children's insurance and other health care-related programs this week qualified for the November ballot, and Democratic gubernatorial nominee Phil Angelides said he will work with Sen. Sheila Kuehl on a broader universal health coverage bill pending in the Assembly, further emphasizing the weight of health care in California in the November election.

Legislation by Sen. Richard Alarcón that would require the Department of Health Services to compare drug prices paid by Medi-Cal and the AIDS Drug Assistance Program with prices paid by the federal government also saw action this week. The bill would require the governor to consider seeking additional rebates from drug companies based on the federal comparison. Debate over the bill comes as AARP and Families USA released studies showing that the Medicare drug benefit could be contributing to wholesale drug price inflation. Conversely, the Wall Street Journal on Thursday reported that the drug benefit has given some large insurers more leverage to negotiate drug discounts. The Journal also reported that Medicaid programs have "effectively capped the discount on drugs to other buyers" because manufactures are required by law to provide the lowest prices to the state programs.

A measure to legalize physician-assisted suicide will be up for a vote in the Senate Judiciary Committee next week. Assembly member Patty Berg in July 2005 stopped action on the measure after determining it would not pass the Senate, but the bill's supporters hope polls taken last year showing strong voter support for physician assisted suicide will give the legislation more momentum this year.

This week's Legislative Update also includes action on:

• Mandated efforts to monitor and prevent hospital-acquired infections;
  
  
• Legislation to create an electronic system to provide access to advance health care directives; and
  
  
• A bill that would provide funding to five Medi-Cal programs that expand health insurance coverage.