$400 billion price tag for California single-payer bill

Courtesy of Wikimedia Commons

The entire state general fund budget is $125 billion, while the proposed 2017-18 state budget stands at just over $183 billion.

Even in the state that spends the most money each year, the $200 billion increase is asking for a lot.

The legislative analysis states the single-payer proposal would likely reduce spending by employers and employees statewide, which now ranges from $100 billion to $150 billion a year.

"The additional $200 billion would need to be raised from new taxes".

The major test for any effort to create a single-payer health care system is how to pay for it. California now knows the math it's contending with.

"It's essential. If it doesn't go through appropriations, it dies", said Shana Alex Charles, faculty associate at the UCLA Center for Health Policy Research and an assistant professor at California State University, Fullerton.

An analysis by the State Senate Health Committee last month found that California now spends $367 billion on health care expenditures annually, of which 71% is already paid for by the federal, state and local governments. It was suggested that a 15 percent payroll tax would provide revenue for the bill. The proposal does not have a specific tax proposal in it, which means it could skirt the two-thirds vote requirement necessary for measures that contain a new tax, the Times reported.

Senate Bill 562, known as Healthy California proposal, would provide coverage for 39 million Californians, supplanting existing employer health insurance as well as Medicaid and Medicare.

But with a national backlash growing against what is seen as the Trump administration move to create budget room to give wealthy Americans another tax break, both the budget and the House health care plan aren't likely to make it through the Senate without severe corrections. Moreover, even if Brown signed the bill into law, a Republican-led Congress would have no reason, or interest, in making sure the federal government cooperated in the program. Opposition increased to 75 percent when those polled were told the price tag for the system is $179 billion annually-which is actually lower than what the legislative analysis suggests.

Single-payer advocates learned that lesson a year ago in Colorado at the ballot box, as the state turned blue for Hillary Clinton even as 79 percent of voters said "no" to single-payer health care.

Kaiser Health News (KHN) is a national health policy news service.

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