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Posted on 05/22/2017 6:44:47 PM PDT by 2ndDivisionVet
California is undertaking an ambitious bid to establish a single-payer health care system, and now its plan has a price tag: $400 billion a year.
The state legislature has been debating a plan this year to implement a government insurance program to cover all Californians, including those without legal status.
It’s a very generous proposal, as currently conceived. The state would pay for almost all of its residents’ medical expenses — inpatient, outpatient, emergency services, dental, vision, mental health, and nursing home care — under the plan, and Californians would not have any premiums, copays, or deductibles. Those sweeping benefits drive up costs.
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. The plan, according to the estimate by the state Senate’s Appropriations Committee, would cost twice as much as the entire state budget that Gov. Jerry Brown is proposing for the next fiscal year.
Lawmakers have been waiting for an estimate of the costs, which they received on Monday. Here is the bottom line, from the Los Angeles Times:
The analysis found that the proposal would require:
*A total cost of $400 billion per year to cover all healthcare and administrative costs.
*Of that, $200 billion of existing federal, state and local funds could be repurposed to go toward the single-payer system.
*The additional $200 billion would need to be raised from new taxes.
Lawmakers have not settled on a plan for paying for the new system, though the analysis released Monday noted a 15 percent payroll tax on employers would cover the increased costs.
Such a significant tax increase could prove politically troublesome, even if employers and employees would see reduced costs through the elimination of insurance premiums, which the Times reported range from $100 to $150 billion per year. Residents would also no longer have to pay most of their health care bills.
Polling on single-payer plans is notoriously fickle, but this February 2016 survey from the Kaiser Family Foundation demonstrates the dilemma California officials will now face:
Half of Americans said, in the abstract, that they would support single-payer. But 20 percent flipped and said they would oppose the idea if it meant many Americans would have to pay higher taxes. That’s nearly twice the percentage of people who flipped to say they would support such a plan because it would reduce insurance premiums and out-of-pocket health care costs.
Vermont is the most recent state to try (and fail) to create a single-payer health care system, as Vox’s Sarah Kliff documented. The state had begun developing its own proposal, to be pursued under an Obamacare waiver, but ultimately scuttled the plan in 2014 after seeing the concept’s cost estimates and the necessary tax increases.
Single-payer health care is increasingly popular in theory among Americans, as Republicans in Washington seek to roll back Obamacare. But the practical and political challenges highlighted by this California news are something that proponents will need to grapple with if they want it to become reality.
Funny stuff. Vermont’s plan was only going to be 1.5 times the state budget. California beats us again.
Kewl — we can steal more of the people’s money!!!
Whenever I decide to do some Home Improvement Project, I always figure that it will take three times as long as I Planned and it will cost twice as much as I planned.
Just sayin’...
As my Late Father always used to say, “nobody owes you a living”. Apparently he was mistaken, at least in CA.
Not to worry. They will be rolling in cash once they have their space mileage tax in place.
easy
we pay 200 million in insurance hypothetically.
The state needs 400 million.
we don’t need insurance any more its in the 400.
The taxpayers get a savings.
Raise taxes 200 and it only puts us 200 more in the red.
No problem. We’re a democrat state and we can go over budget for any reason that suits us.
That way lies Puerto Rico.
Ed
That’s ok we can bail them out. Some day the 50% paying for the other50% need to stand up on our hind legs and say no more.
If wishes were horses....
“The additional $200 billion would need to be raised from new taxes.” How many more businesses will be fleeing California?
In 1912 Cecil B DeMille with Actor Dustin Farnum were making a film for Jesse Lasky and Sam Goldwyn. It was a western, they were going to film in Flagstaff, AZ, that year the rains came so De Mille wired the home office in New York and said they would head to Los Angeles where they rented a Barn out in the Valley and shot “The Squaw Man”.
So Flagstaff could have been Hollywood.
Cut off federal dollars.
$400 billion?
I remember the train to nowhere was to cost $20 billion. It is now over $100 billion and will not be high speed but slow freight train speed. So times the $400 billion by at least 5 times to get the real cost. Also the state will ration health care. Someone will say you voted republican and will be denied care.
Obviously we need to make it national. After all, if you are loosing money on every sale you have to make it up in volume.
They need to raise taxes $400B but don't forget that covers not only the insurance premiums but all of the out-of-pocket medical expenses (deductibles, co-pays, etc.).
I think it's politically difficult but this article doesn't have enough info to do an economic analysis.
Single payer is a problem on many levels but I don't think expense is necessarily one of them.
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Funded by a loan secured by Jerry’s new gas tax!!!!
I think they need to raise taxes on Facebook and Apple to cover tha
There are plenty of very wealthy liberals in California. Let them freely donate and fund the entire program. If other CA citizens (not wealthy) want to donate to the program also, they can freely give too.
After all the illegals, the slackers, the welfare queens, and the addicts all move there, the other 49 states get a well-deserved break.
We'll have to build another fence, though, and quick, before the state bankrupts and all those deadbeats try and escape.
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