State Fiscal Crisis Expected To Preempt New Spending for Health Care Programs

While state lawmakers are expected to introduce measures this session that would expand health insurance coverage, addressing the state's anticipated $21 billion budget shortfall is expected to dominate the session, "virtually" ruling out any new spending, the AP/Ventura County Star reports. Reaching a budget resolution may prove difficult because Republicans, who have vowed to oppose tax increases, have gained seats in the Assembly and Senate, which will make it difficult for Democratic leaders to reach the two-thirds majority needed to pass budget resolutions. Lawmakers are still expected to introduce legislation designed to increase health care coverage. For example, Sen. Sheila Kuehl (D-Santa Monica) said she will propose a bill that would create a single-payer health system to provide "basic coverage" for all Californians. Labor leaders also plan to push for legislation that would require employers to cover at least part of employees' health costs or to contribute to a state fund that would provide workers health insurance (Lawrence, AP/Ventura County Star, 12/2).

Gov. Gray Davis' (D) "questionable" promises to expand health insurance coverage during the recent gubernatorial campaign will be "almost laughably out of date" when the state budget situation becomes clearer this month, Sacramento Bee columnist Dan Walters writes. According to Legislative Analyst Elizabeth Hill, the "fiscal headache" for the state will last for years, as state spending for Medi-Cal is growing nearly 9% annually. At the same time, the state has "mortgaged" its tobacco settlement, which was initially earmarked for health care, to cover the current deficit. Despite the fiscal problems, some legislators will want to "make good" on Davis' promise to expand health care coverage. Given that there are no funds to do so, some will push for the creation of a single-payer system, financed through new taxes, or mandates will be imposed on employers, Walters predicts. He concludes, "Either approach will likely touch off an intense political battle of the sort that self-proclaimed centrist Davis dislikes intensely" (Sacramento Bee, 12/1).