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California's Current Healthcare System is 'Woefully Incomplete'

We are sharing this piece that originally appeared as "It is California's Current Healthcare System Which is 'Woefully Incomplete'" on HuffPost by Dr. Paul Song, Physician, Co-Chair, Campaign for a Healthy California and Board Member of Physicians for a National Health Program. Like Dr. Song, Labor United for Universal Healthcare is deeply concerned about the future of SB 562. While we don't know for sure whether Speaker Rendon will change his mind and allow the bill to move forward at this time, we urge our legislators to work together with determination fueled by the groundswell of public support for single payer and to make the bill as comprehensive and viable as possible. We can't afford to continue with our currently woefully incomplete healthcare system!

Disclaimer: The views and opinions expressed in this op-ed are those of the author and do not necessarily reflect the official policy or position of the Campaign for a Healthy CA or Physicians for a National Health Program.

California Speaker Anthony Rendon recently placed an indefinite hold on SB562 for this legislative session because it was “woefully incomplete”. Sadly, many of us had hoped that the Speaker would allow it to ruminate further in the assembly through a constructive in-depth discussion of logistical limitations, funding mechanisms, federal challenges, and issues associated with the Gann Limit and Prop 98.

Unlike 2010, when then Senator Mark Leno’s single payer bill SB810 fell two votes short in the California State Senate (as six Democrats either abstained or voted no) and generated little to no public outrage, the Speaker’s decision this time was met with tremendous anger and a strong backlash, the likes of which have not been seen in California for quite some time.

Healthcare is indeed complicated and expensive whether it is ultimately paid for by one single entity or not. Total health expenditures in California are soon expected to exceed 16% of California’s $2.5 Trillion GDP. Thus those who tout that SB562 would cost $400 Billion, as if our state was not already spending close to this amount, are being dishonest and misleading.

As for the uncertainty of gaining a federal waiver and/or funding, it is curious why no such criticism or opposition was raised to derail the Governor’s Bullet Train proposal. A recent federal report found new costs to be 50% more than originally estimated, risking the loss of additional federal funding because of a requirement that the state have the necessary funding to match federal grants. Yet, the Governor and legislature have not blinked an eye.

No matter what side you are on in this debate and over the Speaker’s decision, one thing remains indisputable. Our state’s healthcare system is “woefully incomplete” for millions of its residents and remains on shaky ground, held hostage by the growing likelihood of a GOP repeal.

For all the talk about resisting Trump, Sacramento has done very little to proactively protect our state from a heartless GOP healthcare plan that will truly decimate our healthcare program should Mitch McConnell round up the necessary 51 votes.

While the recently signed state budget allocates some of the new Prop 56 tobacco proceeds to finally increase grossly inadequate MediCal reimbursements to California providers, the rates still rank near the bottom in the nation. For a state where one out of every three residents relies on MediCal for their healthcare, this increased funding represents a mere drop in an ocean especially if Medicaid is converted to its GOP proposed per-capita block grant. The latest analysis of the GOP plan reveals that California would lose $3 Billion in Medicaid funding in 2020 and anywhere between $21.8 to $116.5 Billion in 2026 alone. Talk about uncertainty of federal funding!

Over the past several years, Governor Brown has shown that whenever California is under any financial strain or economic downturn, he is more than willing to sacrifice health and human services first and restore them only partially, if at all, when times are good. Thus, it is reasonable to expect that if any GOP repeal does go through, the Governor who has never made MediCal a top priority during his time in office, will be hard pressed to adequately address these Draconian cuts and will most likely opt to reduce and/or eliminate coverage for millions.

If California is indeed lucky enough to stave off the latest GOP attempt, here are a few reasons why the ACA status quo remains “woefully incomplete” and inadequate for far too many Californians.

1. Roughly 2.7 Million Californians are uninsured of which a third are undocumented, 75% are from communities of color, and about 250,000 are kids.

2. Nearly 12 million Californians remain under-insured. Meaning that due to high co-pays and deductibles, they cannot afford to get the healthcare they need (Fig 1). This is especially true for people who purchase the cheapest Bronze plans offered on Covered California’s exchange. These flimsy plans require consumers to personally pay the first $6500 of all medical costs upfront before any insurance kicks in, and only then will it cover 60% of all additional in-network costs. Sadly most Californians do not have $6500 in savings, leading many to delay seeking care while allowing diseases to unnecessarily advance, require even more expensive intervention, and lead to poorer overall outcomes. Of those who opted to receive care, 29% reported having trouble paying their medical bills and it have a major adverse impact on their family (Fig 2).

2014 - THE COMMONWEALTH FUND BIENNIAL SURVEY

2017 KAISER FAMILY FOUNDATION

3. Insurance premiums in California have increased over 200% in the past 10 years. At the same time wages have remained stagnant and 37% of insured now report having financial difficulty paying their monthly premiums. Meanwhile over the same period, workers have been asked to contribute roughly 150% more towards their employer sponsored coverage as well as pay higher co-pays and deductibles (Fig. 3), resulting in far less take home pay and disposable income that could instead be better used to stimulate California’s economy. As a result, healthcare benefits remain the leading cause of labor-negotiation strife and will only get worse with each collective bargaining agreement while putting more and more pressure on businesses, state, and local governments alike. According to State Controller Betty Yee, “One of the greatest fiscal challenges facing California is the mounting cost of providing health care benefits to public sector workers”, as California currently has a $76.68 Billion unfunded healthcare retiree liability.

2015 KAISER FAMILY FOUNDATION

4. Branded Drug Prices have increased 127% during the past 8 years to the point that 73% of Americans now find the cost of drugs unreasonable and millions of adults and one-in-ten seniors skip medications due to their high cost. (Fig. 4). As a result of runaway drug price and premiums, more Americans are now more worried about not being able to afford prescription drugs and healthcare services than being the victim of gun violence or a terrorist attack (Fig. 5).

2015 CONSUMER REPORTS

2016 KAISER FAMILY FOUNDATION

Much of the outrage directed at the Speaker is a direct manifestation of these facts along with the tremendous financial and physical hardship countless Californians experience daily while they navigate through an immoral and unjust healthcare system. Coupled with the fact that Sacramento has failed to adequately address or pass any legislation to curtail excessive insurance rates, drug prices, underinsurance, or unjustified denials, Californians are understandably frustrated and yearning for something better. To many SB562 was the first real action towards providing this.

I would therefore respectfully ask the Speaker and his colleagues what is their plan to address these issues that adversely affect their constituents now?

And I would urge the Speaker not to wait solely on the Senate, but rather use this period of suspension to put together a select committee of the people comprised of health policy experts, stakeholders, patient advocates, and financial analysts with no self-serving alliances to identify and address the “woefully incomplete” deficiencies and complexities of our current healthcare system and come up with real viable solutions while hosting public hearings throughout the state.

At the same time, I would encourage everyone else to work with Senator Lara and the legislature in the coming months to make SB562 so painstakingly comprehensive and complete that no one in Sacramento has any excuse not to act, but rather are forced to give it an up or down vote. As the Speaker stated, we have one more year during this two-year process to satisfy his concerns.

Healthcare affects all races, generations, and socioeconomic groups while support for single payer is the highest it has ever been in California and only continues to increase each day as more and more residents are pushed into financial ruin due to an illness.

Sacramento should not simply brush this bill or our real healthcare challenges under the rug, but instead make a sincere attempt to see what is truly possible, rather than waste any more time arguing what is not. The lives of millions of Californians are depending on it.

Published July 12th, 2017

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