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BestWire

'RECALL INSANITY' SPARKS HEALTH CARE REFORM DEBATE

by R.J. Lehmann, associate editor
Aug 22, 2003

SACRAMENTO (BestWire) - In another example of what one observer dubbed the state's current mood of "recall insanity," California legislators appear ready to fast-track sweeping changes to the state's public health system, with the goal of presenting a bill to Gov. Gray Davis by the end of the month.

Details about the bill remain in short supply, as a bipartisan Senate and Assembly conference committee considers provisions from at least three different proposals to present to the legislature. Most attention has focused on outgoing Senate President John Burton's S.B. 2, which would authorize creation of a "pay-or-play" system that would force companies to either pay for their employees' health insurance, or pay user fees into a statewide risk pool so that the state could buy coverage for them.

"What we know so far is that there is a 100% chance of this bill passing both houses of the legislature and landing on the governor's desk in fairly short order," said Jeffrey Miles, president of the California Association of Health Underwriters. "What it says, what it does, what happens next...nobody seems to have those details as of yet, but they know it's going to pass. Welcome to recall insanity."

According to Miles, the conference committee had set a target date of Sept. 12 for a floor vote on the proposal, but that has now been moved up to Aug. 29. The rescheduled deadline would give Gov. Davis--the subject of a high-profile recall election in which he faces opposition from actor Arnold Schwarzenegger, among others--only eight days to sign the bill before the end of the legislative session. Under the original Sept. 12 deadline, Davis would have been allowed a full 30 days to vote, and could theoretically postpone his vote until after the election.

Miles said more specific details were expected by week's end, but that early rumors about the bill's content ranged from "all play to all pay." He said he hoped for a reasonable compromise on the issue that would expand coverage to more Californians without imposing even more onerous mandates on already reeling small businesses. "If they scrap the pool aspect, then our position is support if amended, and we believe the concept is basically a good one," Miles said. "But a bad bill on this will just kill this state. If we get a bad bill passed in the middle of all this hoopla, it'll make energy deregulation look like a walk in the park."

That skepticism was shared by a number of other sources, including the consumer group, the Foundation for Taxpayer and Consumer Rights, which gives qualified support to S.B. 2.

"Whether or not politicians will take insurers, hospitals and doctors to task for skyrocketing health-care costs will determine the success of the reform debate," said FTCR consumer advocate Jerry Flanagan, in a statement. "For consumers, rising costs equate to decreased access. The fundamental public policy issue is the lack of control over costs, whether it concerns prescription drugs, monthly insurance premiums, hospital charges, or physician rates. The verdict is still out as to whether politicians will protect California consumers and small business owners by requiring all players to abide by efficiency standards."

According to the California Department of Health Services, which administers the Medi-Cal program for low income residents, more than 6 million Californians lacked health insurance coverage at some time in 2002, and roughly 3.6 million had no health insurance coverage at any time last year.
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Contact the author: raymond.lehmann@ambest.com