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AB 1400 (Kalra) passed the Assembly Health Committee this week on a party line vote of 11-3. The bill introduced last year would establish the CalCare Program that would provide universal coverage to all Californians with assumed waivers from the federal government to include all Medi-Cal and Medicare patients and supplant all private insurers. It was amended earlier this week and the author also introduced legislation with a constitutional amendment to provide part of the funding source for the program estimated to cost $400 billion.
Since AB 1400 was introduced last year it must pass the house of origin, the Assembly, by the end of January to remain active. In the alternative the bills could be reintroduced in February and be considered later this year. We will not attempt to provide an overview of all of the elements of the bill since it is detailed and lengthy but here are a few highlights
AB 1400 would provide:
- Coverage for all Californians through a single payer system
- Broad array of coverage including long term care
- No co-pays or premiums
- Anything ordered by a licensed prescriber would be covered with no utilization controls
- Contains a rebuttable presumption that Medicare reimbursement rates are reasonable for fee for service payment
- Establishes mechanism for cost controls and data collection
- Creates global payment system for hospitals that would utilize Medicare DRG payment data
The companion constitutional amendment contains major tax increases for business and individuals that would total an estimated $160 billion to partially pay for the cost of the bill. These changes would have to be submitted to voters via the ballot and would the allow these tax rates to be adjusted via a simple majority vote in the Legislature as opposed to the current 2/3rds vote requirement. That bill has not been scheduled for a vote.
Though the bill passed its first hurdle some of the Democrats who voted aye did so with stated reservations and with no commitment to vote aye if the bill gets to the floor. There is broad opposition from hospitals, CMA and Chamber of Commerce who decry the lack of choice for patients, elimination of private insurance plans, and the lack of necessity for this approach since the uninsured population has greatly decreased. Some Democratic members are also reluctant to pass a bill without a means to fund the program passing at the same time.
The Governor who has campaigned in support of a single payer bill appears to be more supportive of providing coverage for more of the uninsured through Medi-Cal expansion to undocumented residents. It is also an election year, and these kinds of large tax increases may be met with a hostile reception from voters where taxes are already high and there is a continued budget surplus.
In short, there is a long way to go and will know by the end of January whether AB 1400 remains the vehicle. The issue of single payer will not go away as health care costs are still high and advocates continue to pursue this approach. We will keep you informed.
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