Friday, March 12, 2010
As the conflict over health care reform rages in Washington, a far more important revolution is gently taking shape here in California.
California Universal Healthcare Act, Senate Bill 810 provides for the most radical, sweeping health care overhaul ever attempted in any state or by the federal government. And it's no pie in the sky it has twice passed both the state Senate and Assembly and only a governor's veto has prevented it from becoming law. Should Governor Arnold Schwarzenegger's replacement be a Democrat, California's health care landscape might be forever changed.
Major provisions of SB 810 comprise:
- All private California health care insurance institutions Blue Cross, Blue Shield, Medicaid, Medicare and others will be replaced by the California Healthcare Agency, a state-run single payer plan which collects all medical premiums and pays all providers. Non-medical administrative costs cannot exceed 10 percent of revenue for five years and 5 percent after that. (Private insurers spend up to 30 percent on administrative costs.) All Californians would be qualified for a fixed benefit package free, at least initially, from co-pays and deductibles.
- All income will be raised by existing government program funds plus premiums paid to the program, replacing commercial premiums. Premium amounts probably shared by employers and employees would be set by a premium subcommittee, and by law revenue must cover the cost of providing care. Choice of doctor and hospital is preserved and both remain in nongovernmental hands.
- All hospitals and doctors will be compensated through negotiations with the payments board committee of the health plan made up of "experts in health care finance and insurance" and others. Should negotiations fail, "the Payments Board shall launch reimbursement rates which shall be binding".
The payments are collected and distributed through regional payment centers, similar to what Medicare uses, and like Medicare, a single payer plan allows for private choice of physicians, hospitals and all medical providers. The difference between Medicare now and a single payer plan would be that everyone would be in the risk pool, young and old, sick and well, spreading the risk, so the plan would be cheaper. Also, insurance companies would no longer be allowed to be for-profit, which would save at least 20 percent of our health care dollars that go now for big business administration costs and profit.
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