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Pulse on Public Health

HPHR Fellow Priya Vedula

By Priya Vedula

Dissecting Single Payer in California

Introduction to California’s Single-Payer Efforts

California is home to over 39 million people (1). As of 2020, 7 percent of the population (approximately 2.7 million people) remains uninsured while 12.5 million are covered by the state’s version of Medicaid known as Medi-Cal (2).  In the last month, Governor Gavin Newsom and California lawmakers expanded Medi-Cal coverage to uncdocumented seniors over the age of 50 (3). This expansion signaled yet another leap forward towards a single-payer system for all Californians; in 2016 and 2020, the state expanded Medi-Cal coverage to undocumented children and young adults, respectively (3). California legislators recently introduced Assembly Bill 1400, The Guaranteed Health Care for All Act (CalCare); the bill did not make it through the Assembly Rules Committee and instead will move in January 2022 as a two-year bill (4). In 2018, upon getting elected, Governor Newsom made a campaign promise to lead the effort on single payer and created a commission to investigate a financial system for providing healthcare for all Californians. Over time, however, his support for this effort has wavered, and this year, the governor also faces a special recall election (4). With less than a year to go before the bill is revisited, single-payer proponents and activists will need a concerted effort to convince lawmakers that this is the right step for our state. 

 

The idea of single-payer is not new to California. In 1994, Proposition 186 made it to the ballot as an initiative to establish single-payer. The proposition garnered support by only 27 percent of voters with an overwhelming majority (73 percent) voting “no.” At the time, the effort to get the proposition on the ballot was one of the largest grassroots funded political campaigns in the history of the state (5). In 1998, with the help of Senator Barbara Lee, SB2123, the Cal-Care Health Insurance Act was introduced but it later failed in the Senate Health Committee. Since that time, the organization Healthcare For All helped with the introduction of numerous bills to address single-payer and a universal healthcare program. While single-payer did not become law, the efforts helped move the needle on bringing this issue to the forefront. Read more about the history of single-payer healthcare legislation in California: https://healthcareforall.org/wp-content/uploads/2019/08/History-of-CA-SP-Leg_1997-2019.pdf.

What Single Payer Looks Like

What exactly does a single-payer healthcare system look like? By definition, a single payer healthcare system is a system in which there is a single public agency that handles the financing of healthcare for all residents. Depending on how a legislation is written, a single-payer system can be structured in different ways. Assembly Bill 1400 would establish a system known as CalCare that would expand coverage to all Californians and include long-term care, dental care, mental health care, and prescription coverage. The bill would also remove all out-of-pocket costs such as premiums and deductibles, with the healthcare prices set by a governing board. Finally, the bill would not ban private insurance; rather it would allow for health insurance companies to supplement CalCare (6).

Pros and Cons of a Single-Payer System in California

The main benefit of a single-payer healthcare system is universal coverage for every person. Moreover, the coverage includes essential services, such as dental and mental health coverage, that are often not included as part of healthcare coverage; when a person has healthcare coverage that is not enough or that entails high out-of-pocket expenses, they are considered underinsured. It is estimated that more than one-third of insured Californians are actually underinsured. Additionally, studies anticipate potential cost savings through such a program by cutting down on unnecessary services, missed prevention, decreasing administrative burdens, and tackling pharmaceutical pricing (7). A single-payer healthcare system can also address the health inequities and racial disparities within the current system. 

 

Perhaps the biggest con that is often stated by opponents and even proponents is the price it would cost to implement such a system. The Senate Committee on Appropriations estimated that such a system would cost $400 billion per year (8). Assemblymember Ash Kalra, author of AB1400, argued that the state already has similar costs per year for the current system which is ineffective. A second problem with the system is that California seniors would be covered under this new system rather than Medicare- something that may not be viewed favorably by seniors. Another potential issue is that private insurance would not be required to work with CalCare without changes at the federal level (9). This means that private insurance companies could disrupt demand. Finally, implementing such a system could potentially reduce reimbursement rates for healthcare providers and may require the state to cut down on costs in other sectors; in fact, the California Medical Association and the California Dental Association opposed the legislation as written (10). Opponents have also mentioned potentially long wait times and rationing of care. The Commonwealth Fund, however, debunked these theories by comparing wait times across nations that had single-payer to the US; the study found that the US performed worse than most nations with universal coverage (11).

Moving Ahead

California is not the only state to introduce single-payer legislation as multiple other states have made similar attempts in the past, with a focus on access, quality, and cost (12). It is important to acknowledge that the system has been implemented successfully in nations such as Canada, Denmark, Norway, and Sweden (13). It is abundantly clear that our healthcare system is broken as we must continue pursuing a more just and equitable system. The health of our nation is a reflection of those who are the least healthy; and the argument for a system that seeks to cover all is largely a moral one. It is difficult to persuade people to step out of their comfort zones and accept a new system that will affect how they receive care. This is why single-payer advocates will have to determine the best way to market this system to the general public. As I think about this, however, I am reminded of the quote by Teri Reynolds, “It is hard to talk about middle ground for something that is a fundamental right.

 

Yet, as a Californian, I also know that California legislators and Californians are often at the forefront of such battles. As a future physician who works with unhoused populations, I have hope that California will find a way. 



References: 

  1. https://www.census.gov/quickfacts/CA
  2. https://www.chcf.org/publication/how-many-your-area-are-covered-affordable-care-act/
  3. https://www.capradio.org/articles/2021/07/01/california-to-provide-health-insurance-for-undocumented-residents-over-50-following-toll-of-covid-19/
  4. https://www.capradio.org/articles/2021/04/29/with-latest-california-single-payer-health-care-bill-shelved-advocates-push-newsom-for-support/
  5. https://link.springer.com/article/10.2307/3342694
  6. https://khn.org/news/article/new-single-payer-bill-intensifies-newsoms-political-peril/
  7. https://www.greenpolicy360.net/mw/images/Single-Payer-Pollin-Economic-Analysis-CA_SB-562.pdf
  8. https://s3.documentcloud.org/documents/3728610/SB-0562.pdf
  9. https://www.nytimes.com/2018/05/25/business/economy/california-single-payer.html
  10. https://www.cda.org/Home/Advocacy/Advocacy-Overview/Major-Issues
  11. https://www.americanprogress.org/issues/healthcare/reports/2019/10/18/475908/truth-wait-times-universal-coverage-systems/
  12. https://link.springer.com/article/10.1007/s11606-017-4063-5
  13. https://worldpopulationreview.com/country-rankings/countries-with-single-payer













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