Schwarzenegger

California Governor Arnold Schwarzenegger delivered his annual State of the State address in front of the joint session of the California State Legislature tonight. He talked about several topics including global warming, education and other hot button issues. But most eyes were on his health care initiatives.

His plan would cover illegal immigrants, raising concerns of immigration-control advocates. The governor said that we are all paying for the uninsured through our taxes and higher health insurance premiums. Hospitals pass along the cost of the noninsured to everyone that has insurance, according to Schwarzenegger.

At any given time, one in six Californians will be without health insurance. The Governor proposes that “all Californians have some minimum level of insurance to ensure that those with insurance no longer pay for the uninsured.” According to the Governors office, his plan will have a system to encourage and reward “healthy behaviors”.

The governor’s office claims that his plan will “cut the hidden tax in half”. His plan will also provide subsidies for low-income families to buy health coverage through a new purchasing pool. Schwarzenegger also plans on expanding Medi-Cal to include poor adults and expand Healthy Families/Medi-Cal to all children in families earning less than $60,000 annually.

The more controversial proposal involves employer responsibility. The plan will require companies with 10 or more employees to contribute 4 percent of the total payroll toward the cost of employees’ health coverage.

The California Chamber of Commerce says that this proposal could drive businesses away from California. The governor’s office says that 80 percent of the companies in California have less than 10 employees, and would be exempt from the contribution. Schwarzenegger says that the 4 percent fee will prevent employers of ten or more from dropping their health care coverage in light of the state’s program.

One part of the plan is receiving wide spread support. The governor’s plan would guarantee individuals access to coverage in the individual market. Many insurance companies will deny coverage to people with pre-existing health conditions. It is believed that this would ensure coverage for every Californian.

The plan would also require insurance companies spend 85 percent of every premium dollar on patient care, and make “Healthy Actions” benefits available to promote healthy behaviors. The Governor’s initiative will expand the state’s insurance pool by 4-5 million and give insurers fair compensation for their services.

He promises that hospitals will receive higher Medi-Cal rates. This should eliminate some of the hidden costs, according to the governor. Hospitals will receive “$10-$15 billion—and in turn, will contribute a portion back to universal coverage. Physicians will contribute 2 percent of revenues and hospitals will contribute 4 percent, ensuring some of the savings stays in the system to support total coverage and increased Medi-Cal rates to providers.”

The governor points to a poll concerning the need for health care reform. “There is widespread voter agreement that government should assure access to affordable health care insurance. Statewide, 81% of voters agree (59% strongly) with the statement “it should be public policy that government guarantee that all Californians have access to affordable health care insurance or other health care coverage.” In addition, 78% agree (44% strongly) that government has a responsibility for providing health care coverage for people who can’t afford to pay for it themselves.” The results are from a Field Poll called “California Voter Views of the Health Care System (Part 1 of 2),” taken on January 3, 2007.

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By Dan Wilson
Best Syndication Writer

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