Single-payer could cost California more than twice the state budget

May 23, 2017

Ricardo Lara

A plan to create a single-payer healthcare system that is currently under consideration in the California Legislature would cost $400 billion annually to implement, according to a legislative analysis released by the Senate Appropriations Committee on Monday. By comparison, California’s proposed budget for the upcoming fiscal year is approximately $180 billion.

In order to cover healthcare and administrative costs, California could redirect $200 billion of existing federal, state and local funds toward the single-payer system. However, the state would need to raise another $200 billion from tax hikes, according to the analysis.

SB 562, a bill introduced by state senators Ricardo Lara (D-Bell Gardens) and Toni Atkins (D-San Diego), calls for creating a Medicare-style health system for all California residents, including illegal immigrants. If adopted, California would become the first state in the country to institute a single-payer system.

Under the proposal, private insurers would be replaced with a state agency that would function as an insurance company, paying doctors and hospitals when people seek treatment. Residents who currently receive insurance through employers would received coverage through the state.

The legislative analysis states the single-payer proposal would likely reduce spending by employers and employees statewide, which currently ranges from $100 billion to $150 billion a year. However, the analysis says there is tremendous uncertainty about how the single-payer healthcare system would function.

“This bill would require unprecedented changes to a mature healthcare system,” the legislative analysis states.“Therefore, there is tremendous uncertainty in how such a system would be developed, how the transition to the new system would occur and how participants in the new system would behave.”

At the California Democratic Party convention over the weekend, the issue of single-payer healthcare received considerable attention. Progressives, including hundreds of nurses, railed for a single-payer system, while some party officials expressed doubt over whether the state would be able to fund the plan.

Last month, SB 562 passed the Senate Health Committee on a 5-2 vote. State Sen. Bill Monning, who represents San Luis Obispo County, cast one of the votes in favor of the single-payer bill.

On Monday, the Senate Appropriations Committee voted unanimously to place the bill in its suspended legislation file.


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LOVESLO

…because the Democrats did such a wonderful job with Obamacare…JK.


shelworth

Piece of cake! Since California’s personal income tax is the state’s largest single revenue source and is expected to generate $83.8 billion in 2016‑17, we need only sextuple the State Income Tax from 10-12% to 60-72%, 6X80 billion = 420 billion. Think of all the money you will save not having to pay for your health insurance!


Ricky2

I take it you flunked math?


easymoney

Interesting that in over 8 years with the government taking over our personal medical insurance, that the entire thing is unraveling…

I don’t know about others on here, but my families medical insurance has been a nightmare and I have one of the big dog agents in the county as my agent and even he has had enormous problems…

The first thing that should have been done was a complete overhaul of the medical industry, the medical insurance industry and to assure us buyers(especially here in CA with few to zero in the way of choices) to purchase form a broader pool across state lines.

Now with moonbeam and the dem led legislature, who can not balance a simple budget on time, stepping over their heads and going to force us to take on this latest bureaucratic run situation. Again with out fixing what is really wrong.


Anyone interested in reading about the history of all of this and how to fix it needs to read “an American Sickness, How healthcare became big business and how you can fix it” by Dr. Elisabeth Rosenthal…


laftch

Let me tell you how it will be

There’s one for you, nineteen for me

‘Cause I’m the taxman, yeah, I’m the taxman


Should five per cent appear too small

Be thankful I don’t take it all

‘Cause I’m the taxman, yeah I’m the taxman


If you drive a car, I’ll tax the street,

If you try to sit, I’ll tax your seat.

If you get too cold I’ll tax the heat,

If you take a walk, I’ll tax your feet.


Don’t ask me what I want it for

If you don’t want to pay some more

‘Cause I’m the taxman, yeah, I’m the taxman


Read more: Beatles – Taxman Lyrics | MetroLyrics


SLOBIRD

I have been following this in the State Capitol for quite awhile now! The cost will fall on the businesses in this State with a tax similar to the Medicare Tax (10 years ago that was proposed to be around 7% and now the estimate is around 15% – think about that for a second). I hope the legislators in Sacramento realize that this will open the border for even more illegals into our State as well as the sickest in the U.S. to move to California for their free healthcare which will be crappy for sure. Me, that will probably be the final straw that changes my future!


Jorge Estrada

We would all be surprised if government and insurance companies were not allowed to partake in our health care needs. The only difficult question would be how to fund welfare health care for illegals?


Citizen

It’s more than that. There would be a payroll tax for people working and employers, an increase (15% is being tossed around ) in California state income taxes for everyone who pays taxes, and Medicare/Medicaid, PersCare funds would be rolled over into the single payer plan. Hospitals, doctors, and nurses would start working for the state where salaries would be standardized and capped.


Retired people with Medicare will have a choice of going to the single payer plan or leaving the state to keep their Medicare. Anyone with private insurance will also have that choice.


Since California considers anyone who crosses into the state with the intention of living here a resident of the state, we would have the problem of people from other states, tourists, foreigners, and people here illegally to contend with.


I do think that Single Payer won’t pass this year, but maybe next year when some of the financial problems are worked out. And I do think that the loss of Medicare for those already using it is going to be the straw that broke the back, meaning that people will leave rather than trust Kevin De Leon and Richard Lara with their healthcare at the very time they need it.


However, I see the salaries of healthcare professionals as the main problem–many doctors will not want to work as a modestly paid government employee, especially if they can’t recoup the money they owe from Med School student loans and setting up their practice. They will also leave the state.


RonHolt

I don’t know enough details about what is being proposed to debate all your points but I will address two.


As far as people moving into the state goes, I have heard that they are proposing a “waiting period” before they would be covered under a state-run health program. (1 year?) That wouldn’t stop all abuses of the system but would reduce them significantly. For someone with a serious health problem, a year is a long time to wait for treatment without cost.


As far as medical professionals go, I don’t think limitations would affect most of them. Some of the higher paid specialties (brain surgeons?) might have enough of a cutback to make them think about moving elsewhere but, due to various current limitations by insurance companies, most doctors aren’t overpaid as it is right now. A bigger problem with getting doctors right now is the lack of doctors being fed into the system by medical schools. The high cost of housing is also makes it harder to keep them here.


nunsense

so let’s replace something is currently costing 100 – 150 billion a year with a STATE RUN program that would cost 400 billion (probably estimated by the same people who give us the “bullet” train estimates).


Maybe let the refugees or avowed communists run the program.


*sigh*


Rich in MB

First, can someone name for us a Government Program or Cost Estimate that is not grossly low?


Second, can someone name for us a Government Program that you would like to hold up as a shining example of Government Efficiency and Customer Service?


Thirdly, there is no thirdly…the State is already broke so you might as well promise a Free 2500sqft hose with a chicken in every pot for every California Citizen and Illegal Immigrant…why not…it’s all fantasy anyway, so go big or go home with your fake promises.


kettle

“it’s all fantasy anyway”


Like your comments.


r0y

Why was kettle down-voted? It *is* pure fantasy to name a Government Program of Cost Estimation that is not grossly low…


Hell, it’s pure fantasy to think the government running something without competition will end well. If they do implement this, and the state implodes further, think about your over-valued real estate and the fact that no one will: A) be able to afford what you’d ask, or B) even want it, as there may be a mass exodus of real intellect¹.


¹ not to be confused with “academic intellect” which often isn’t intellect at all.


rukidding

You have really got to be kidding? Letting the state get involved? When was the last time that you can remember when they did anything good for the taxpayer? Just another potential nail in the coffin. I thought that maybe California was suffering a slow death although it looks like the Democrats want to put it on the Fast Trac.


kettle

“I thought that maybe California was suffering a slow death ” No.


Still one of the top economy’s in the world and all your bitching will not change that.


“The economy of California is larger than that of any other US state, and, when compared to full countries, it is the 6th largest economy in the world.”


Haters going to hate.


rukidding

Then why are we getting taxed and fee’s to death? So we can cover their incompetency. Will you ever get it or are you on the entitlement program?


kettle

“Will you ever get it or are you on the entitlement program?”


I get it. Entitlement program? No Home owner, employed full time.


Troll someone else, “to death” Drama much?


r0y

Kettle is correct, last year California was estimated to be the 6th largest economy in the world, out-ranked only by the U.S., China, Japan, Germany and the United Kingdom. California did pass up France (7th) and Brazil (8th), as those two countries are in a bit of a slow death spiral (mostly late-stage socialism, which always destroys an economy, usually through devaluation of currency).


Californians can thank Hollyweird and Silicon Valley for continuing to bring in the green. The “real green” (not the heavily-subsidized “scam green”). So, go tell all your out-of-state / out-of-country friends to buy a movie (or ticket) and buy some software!


rukidding

How do you spell deficit?


r0y

Just because one does not like what they hear, does not mean it is any less truthful.


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