Governor, Democrats Close to a Deal on Health Care Reform Bill

[CAL/AAEM News Service]

Governor, Democrats Close to a Deal on Health Care Reform Bill

Source: California Healthline ( http://www.californiahealthline.org/ )
Date: September 24, 2007


Gov. Arnold Schwarzenegger (R) and Democratic legislative leaders are nearing a
compromise on a health care reform plan that Republican lawmakers refuse to endorse, the
San Francisco Chronicle reports (Chorneau, San Francisco Chronicle, 9/23). 

Aaron McLear, the governor's press secretary, said, "We hope to have a (health care
reform) bill very, very soon." He added, "It's just a matter of closing the last few
inches" (Vick, Washington Post, 9/24).

Democratic, Schwarzenegger Proposals

Earlier this month, the Legislature approved a health care reform bill (AB 8) by Assembly
Speaker Fabian Núñez (D-Los Angeles) and Senate President Pro Tempore Don Perata
(D-Oakland) that would have been financed largely using employer contributions. 

Schwarzenegger said he would veto the measure and called a special legislative session to
seek a compromise on health care reform. 

Schwarzenegger's proposal, meanwhile, would require contributions from businesses,
hospitals, consumers and physicians (California Healthline, 9/18). 

The California Hospital Association and the Los Angeles Area Chamber of Commerce endorsed
the proposal last week.

Outlook

Núñez said, "The main sticking point, as it always is, is the funding formula, and where
is the revenue stream?" He added, "When you rely on a free-market health system, and you
want everyone to participate, the key issue is affordability." 

Although AB 8 would have drawn funding largely from employers, Núñez now maintains that a
compromise reform plan must rely on contributions from hospitals, employers and workers.
He added, "And then we're going to have to go out and hustle the voters for a sales tax
to make up for the difference" (Washington Post, 9/24).

Schwarzenegger and Democrats are working on a compromise that would enact the framework
of the health care reform plan, while asking Californians to approve the financing
mechanism for the plan in a ballot initiative next year. Pursuing voter approval for the
funding will bypass Republican legislators who are on record as opposing any tax
increases or proposals to require fees to fund the health care overhaul (San Francisco
Chronicle, 9/23).

Proponents of the proposed ballot measure would have to collect signatures to qualify it
for the ballot, according to Marian Mulkey, senior program officer at the California
HealthCare Foundation.

Legal experts maintain that the Legislature cannot vote to put the issue directly on the
ballot (Solovitch/Roberts, Silicon Valley/San Jose Business Journal, 9/24).

National Implications

Efforts to expand health insurance coverage in California could offer a preview of what
lies ahead for other states and the U.S. as support builds for health care reform, Dow
Jones News Service reports.

Betsy Imholz, special projects director for Consumers Union in San Francisco, said, "With
California's population and share of the health care marketplace, if we could do it here,
it would be a tremendous push and boost for the federal effort."

Moreover, other states could move to overhaul their own health care systems if the plan
under consideration in California takes effect, according to Jonathan Oberlander,
associate professor of social medicine and health policy and administration at the
University of North Carolina-Chapel Hill (Gerencher, Dow Jones News Service, 9/24).

Weekly Radio Address Raises Concern

Some advocacy groups are criticizing Schwarzenegger for allowing Lloyd Dean, president of
Catholic Healthcare West, to substitute for him in his weekly radio address to pitch the
governor's health care reform plan, the Sacramento Bee reports. 

Dean said the proposal "would insure everyone, reduce costs, increase accountability,
reward wellness and prevention, and improve the quality of care." 

Anthony Wright, director of Health Access, argued that "for a public official to
spotlight and give air time to a private corporation does raise questions, even if it's
toward a goal that we agree with, which is health care reform." 

McLear said, "I think it adds another dynamic to the address to have not just the
governor each week, but various stakeholders who have an interest in these issues." 

Dean declined to comment on the issue (Sanders, Sacramento Bee, 9/23).

Compromise Two Weeks Away?

Núñez said that he and Schwarzenegger are about two weeks away from reaching a deal on a
health care reform bill, George Skelton writes in his "Capitol Journal" column for the
Los Angeles Times. Once a compromise is reached, Núñez said the Legislature will hold
hearings before passing the measure on a simple majority vote. 

A ballot initiative to approve the necessary funding for an overhaul likely would occur
in November 2008, according to Núñez. 

He added, "I don't feel fully confident that the voters will support us, but I think
they're sending us the right signals," referring to public polls showing support for
health care reform (Skelton, Los Angeles Times, 9/24).

Editorial

"The good news is that the public probably will have an up-or-down vote in June 2008 on
whatever compromise plan the governor and [Núñez] secretly craft," a San Diego
Union-Tribune editorial states. "The bad news is that once they place their
sure-to-be-flawed measure on the ballot, they will try to shut off debate about its
details," according to the editorial. "This is no way to run a state," the editorial
concludes (San Diego Union-Tribune, 9/22).

For more information, please visit:
http://www.californiahealthline.org/articles/2007/9/24/Governor-Democrats-Close-to-a-Deal-on-Health-Care-Reform-Bill.aspx

________________________________________________________________________

Hospitals Agree To Help Fund Governor's Health Reform Plan
 
Source: California Healthline ( http://www.californiahealthline.org/ )
Date: September 7, 2007


The California Hospital Association's board on Thursday agreed to a provision in Gov.
Arnold Schwarzenegger's (R) health care reform plan to require hospitals to contribute 4%
of revenue toward expanding health care coverage, the San Diego Union-Tribune reports
(Ainsworth, San Diego Union-Tribune, 9/7). Hospital contributions would be capped at 4%.

CHA opposed the governor's proposed mandatory contributions since his plan was unveiled
in January, but the board agreed to a deal after the administration made several
concessions (Rau, Los Angeles Times, 9/7). 

The agreement comes after a consultant commissioned by CHA reported that the reworked
agreement would increase revenue for 282 hospitals, while cutting into revenue for 88
facilities (San Diego Union-Tribune, 9/7).

Details

Under the agreement, hospitals' contributions would generate $1.7 billion annually and an
additional $1.7 billion in Medi-Cal matching funds from the federal government.
California's current Medi-Cal reimbursement rates are the lowest in the nation.

The revenue first would be spent to maximize Medi-Cal reimbursements and managed care
payments, and the remaining money would be earmarked to expand coverage to the uninsured.
The funds would be placed in a hospital trust account separate from the state's general
fund.

The agreement also would: 
•	Guarantee annual Medi-Cal rate increases; and 
•	Continue -- and increase annually -- the state's current general fund expenditures to
hospitals (Rojas, Sacramento Bee, 9/7).

According to the Los Angeles Times, those provisions in conjunction with the 4% cap on
hospital contributions agreement could result in California having to increase health
care spending if the federal government were to reduce Medicare physician payments (Los
Angeles Times, 9/7).

As part of the deal, hospitals also agreed to no longer practice "balanced billing," in
which patients treated out-of-network are directly billed when a dispute arises between
insurers and providers. 

The agreement would end after five years unless the Legislature and governor reauthorize
it (Sacramento Bee, 9/7).

For more information, please visit:
http://www.californiahealthline.org/articles/2007/9/7/Hospitals-Agree-To-Help-Fund-Governors-Health-Reform-Plan.aspx


Abid Mogannam & Brian Potts 
Managing Editors, CAL/AAEM News Service
University of California, Irvine

The CAL/AAEM Archives are available at: http://maillists.uci.edu/mailman/public/calaaem/



       
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