California Health Care Reform Bill Rejected, Gov. Vows to Continue Effort

A California Senate panel voted 10-1 late Monday, January 28, to reject comprehensive health care reform crafted by Republican Gov. Arnold Schwarzenegger and Democratic Assembly Speaker Fabian Núñez. The panel action came just over a month after the Assembly approved a compromise bill hammered out by Schwarzenegger and Núñez.

Monday’s vote’s also canceled a companion ballot initiative that would have provided the funding for the reforms, including employer health care coverage spending requirements and an increase in the cigarette tax and fees paid by hospitals to support increases in provider reimbursement from the state’s Medicaid program.

Provisions in the compromise bill—aimed at bringing health insurance coverage to most of the state’s nearly 7 million uninsured—would require most state residents to obtain health insurance, while the state would subsidize premiums for lower-income state residents.

Employers would have to spend a specific percentage of payroll on health care for employees or pay into a pool that would be created to provide coverage for the uninsured.

The cost of the reforms was projected at more than $14 billion, roughly the size of the deficit the state faces this year. Before Monday’s vote on the bill, Núñez challenged the committee to come up with a better reform measure.

“I would challenge the members of the Senate to come up with a plan that’s doable, and that can withstand the same type of scrutiny [the proposal] was put through in this committee, the same kind of analysis by the Legislative Analyst, that is going to respond to the needs of those poor families who have absolutely no health care today,” Núñez said in testimony at the panel hearing Monday.

Meanwhile, Gov. Schwarzenegger is evaluating his next move, according to a spokeswoman.

“The fact that the Senate missed a golden opportunity to pass health care reform doesn’t change the governor’s commitment to fixing California’s health care system,” the spokeswoman said. “Keep in mind that in Massachusetts, it took Gov. Romney three years to push the concept of individual responsibility across the finish line.”

Filed by Joanne Wojcik of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.