Not yet coverage for all, but for more
It was way easier for candidate Gavin Newsom to endorse single-payer health care coverage for everyone than it is now for Gov. Newsom to deliver it.
Yet hardcore advocates say they’re pleased with the moves he’s made thus far—even if it may take years to come to fruition.
“This is a governor that is operating from a compass of action,” said Stephanie Roberson, government relations director for the politically powerful California Nurses Association, which hasn’t exactly been known for its patience on the issue.
Newsom has taken two tacks. He’s asking the Trump administration to let the state create its own single-payer system offering coverage to all Californians—a move almost everyone regards as a very long shot. And he’s also pushing specific ideas to expand health care coverage to hundreds of thousands of still-uninsured Californians—a move that seems much more doable.
During his campaign, Newsom promised the nurses that he would make it happen. But the state can’t do it alone. That’s why he sent a letter to the federal government right out of the gate, asking the administration and Congress to set up an “innovation waiver” to allow California to create its own single-payer system.
Experts say there is little chance the Trump administration will give the state the go-ahead on this.
“He’s making a statement, and sometimes making statements is important—even if there’s little chance of making progress in the immediate future,” said Gerald Kominski, senior fellow at the UCLA Center for Health Policy Research. “It’s a way of drawing a line in the sand.”
It’s also a way to stave off criticism from advocates, said Jesus Ramirez-Valles, director of the Health Equity Institute at San Francisco State University. “He can say, ‘I tried it,’ and there is no risk on him. If he doesn’t do what he promised, then he is risking opposition.”
Federal permission also would require Congress to support a new waiver system—one that would allow the state to redirect funds that usually go to the federal government, such as Medicare income taxes, to a state funding authority that would manage and pay for a single-payer health care system, Kominski said. Current waiver systems do not allow for this type of financial management by the state. Other states have used existing waiver programs for permission to set prices or to implement additional requirements, but not to collect federal money.
“You have to ask for the money,” said Roberson of the nurses union. “We are not going to sit on our hands and hope something is going to happen. This strengthens the governor’s commitment to Medicare for all.”
Meantime, Newsom is tackling the block of 3 million uninsured California residents by chipping away at the edges—proposing spending to help struggling middle-income families buy health insurance, and providing state coverage to some undocumented young adults.
He’ll need approval from the Legislature, now a supermajority of Democrats, many of whom have supported similar ideas in recent years.
Two intertwined proposals in his budget would offer hundreds of thousands of middle-income families additional state subsidies to buy health insurance, and require every Californian to obtain health coverage or pay a tax penalty.
This “state mandate” would replace the controversial federal mandate—a central component of the Affordable Care Act, or Obamacare—that the Trump administration recently canceled. A few other blue states were quicker to create a replacement state mandate, but California’s progressive lawmakers were wary of penalizing people who failed to buy health insurance unless the state also cushioned the blow by offering people more subsidies to lower the costs.
Newsom also proposes to use $260 million in state funds to extend Medi-Cal, the government health program for people who can’t afford insurance, to low-income undocumented immigrants ages 18 to 26.
It’s a classic “Resistance State” action for Newsom, as California tries to counteract the Trump administration’s federal moves to undermine Obamacare. Last year, a joint UCLA and UC Berkeley study found that the uninsured rate in California would rise to nearly 13 percent by 2023 if nothing is done at the state level to prevent it.
Since the Affordable Care Act was enacted, California’s uninsured rate has dropped from about 17 percent to roughly 7 percent. Roughly half of those 3 million remaining uninsured are undocumented immigrant adults who don’t qualify for assistance.
Peter Lee, who directs the state health insurance exchange Covered California, praised Newsom’s proposals during a recent board meeting.
“Not only does his initiative propose an individual penalty show courage,” he said, “it shows some thoughtfulness about the challenges that middle-class Americans face.”
Enrollment for Covered California, which recently ended, was down 15 percent over last year. Lee said the elimination of the federal penalty is partly to blame.
A draft affordability report Covered California is preparing for the Legislature concludes that if Newsom’s two proposals—expanded subsidies and a mandate—are adopted, enrollment could rise by nearly 650,000 people.
Funding the subsidies with penalties is, of course, a bit of a Catch-22: The more successful California is in getting people to obtain health care, the smaller the penalty fund to pay for the subsidies that help fund that care.
“You’re accomplishing your goal, but you’re taking away revenue,” Kominski said. “This is the kind of problem we should be happy to have.”