Schwarzenegger, Núñez Reach Accord on Health Care Reform
On Friday, Gov. Arnold Schwarzenegger (R) and Assembly Speaker Fabian Núñez (D-Los Angeles) reached a tentative agreement on a $14 billion plan to overhaul California's health care system, the AP/Ventura County Star reports. The Assembly is scheduled to vote on the proposal today.
An analysis by Núñez's office projects that the agreement would expand coverage to about 70% of California's uninsured residents.
Under the compromise plan, nearly all residents would be required to obtain health care coverage, including 3.6 million uninsured Californians.
The plan would provide tax credits for purchasing coverage to:
- Residents who spend more than 5.5% of income on health insurance if their income does not exceed 400% of the federal poverty level; and
- Residents who spend more than 10% of their income on health insurance if their income does not exceed 700% of the poverty level.
Low-income residents, including undocumented immigrants, would be exempt from the coverage mandate if they would be required to spend more than 5% of their income on minimal coverage and do not qualify for public programs.
The plan also would extend coverage to children whose families' income does not exceed 300% of the poverty level, regardless of immigration status (Kurtzman, AP/Ventura County Star, 12/15).
The governor and Núñez revised how much employers must pay toward health coverage. Under a new sliding scale, businesses with payrolls:
- Up to $250,000 would contribute 1% of payroll toward coverage;
- From $250,000 to $1 million would contribute 4% toward coverage;
- From $1 million to $15 million would contribute 6%; and
- Above $15 million would contribute 6.5% (Zapler, San Jose Mercury News, 12/16).
The plan also would be funded through:
- A 4% tax on hospital revenue in an effort to secure matching federal funds and boost Medicaid reimbursements for services (San Jose Mercury News, 12/16); and
- About $5 billion in anticipated new federal funding, including for Medi-Cal.
Medi-Cal is California's Medicaid program (Chorneau, San Francisco Chronicle, 12/15).
Schwarzenegger has agreed to Núñez's proposal to partially finance health care reform by raising the state's tobacco tax. The governor had favored a lease of California's lottery.
However, Núñez is backing a $2 tobacco tax increase, while Schwarzenegger favors a $1.50 tax hike.
Meanwhile, Senate President Pro Tempore Don Perata (D-Oakland) said a proposed tobacco tax increase is "flawed only because big tobacco has a huge amount of money" to spend on defeating the measure (Rojas, Sacramento Bee, 12/15).
Tobacco companies spent more than $60 million last year to help defeat a proposed tobacco tax increase on the ballot (Ainsworth, San Diego Union-Tribune, 12/15).
Aides for Núñez and Schwarzenegger contend that Perata could determine whether a health care reform bill wins legislative approval this year, according to the Bee.
Núñez said that an overhaul bill must be approved by the Democratic-controlled Legislature and signed by Schwarzenegger by Friday to secure enough time to qualify a financing measure for the November 2008 ballot.
Perata, however, told Democratic lawmakers earlier this month that he would not call senators back to the Capitol until next year. The Senate leader said it is "possible to get something on the ballot before November without doing it this week" (Rojas, Sacramento Bee, 12/17).
Perata wants to delay a vote on health care reform until lawmakers determine how much funding will be cut from health programs such as Medi-Cal as part of efforts to reduce a projected $14 billion state budget shortfall (San Jose Mercury News, 12/16).
Schwarzenegger acknowledged that state spending will be cut "across the board," including from Medi-Cal's budget, but noted that the health care reform plan would boost Medi-Cal funding by $4 billion (San Francisco Chronicle, 12/15).
The governor also argued that the plan would not require money from the general fund and would prevent some budget cuts.
Núñez, meanwhile, maintains that Perata still could agree to hold a vote on the plan this week (Sacramento Bee, 12/17).
The California Labor Federation, a key stakeholder in health care reform negotiations thus far, urged Assembly members to postpone Monday's vote on the tentative deal.
Art Pulaski, director of the group, argued that neither labor groups nor lawmakers have had enough time to review the details of the revised plan and determine whether it ensures affordable coverage for middle-income workers.
Steve Maviglio, spokesperson for Núñez, said the Assembly will move forward with the vote despite the union's opposition. He added that the group had been at the negotiating "table from Day One until the last meeting."
Meanwhile, the Service Employees International Union argues that the impact of an approved health care reform plan in California outweighs any problems with the plan's details. The union believes the plan could boost national efforts to achieve health care reform (Rau, Los Angeles Times, 12/16).
The governor discussed the status of health care reform negotiations at an appearance Friday. Video and a transcript of his remarks are on his Web site (Office of the Governor release, 12/14).
Speaking on behalf of Schwarzenegger in his weekly radio address, Health and Human Services Secretary Kim Belshé discussed the governor's efforts to reach a deal on health care reform.
Audio of Belshé's remarks and a Spanish translation are available on Schwarzenegger's Web site (Office of the Governor release, 12/15).
Summaries of opinion pieces regarding health care reform in California appear below.
- Peter Foy, Ventura County Star: "While it looks like the Democrats' big-government bill is headed for passage, voters will have the final say on the funding plan," Foy, a Ventura County supervisor and owner of a health insurance business, writes in a Star opinion piece. "If [voters] are concerned with affordability -- both of health care and of living and working in California -- they will vote no," Foy writes (Foy, Ventura County Star, 12/16).
- Daniel Weintraub, Sacramento Bee: If Schwarzenegger and Núñez's compromise plan "makes it to the ballot, (it) will likely draw opposition from the tobacco industry, ... from Blue Cross ... and from the California Nurses Association," Weintraub writes in his Bee column. "Business groups would likely be split, with large firms that already insure their workers supporting it and smaller companies opposed," Weintraub writes (Weintraub, Sacramento Bee, 12/16).