• New Census data: California uninsured rate rises to 19%; CA among “top 5” worst states
  • State Senate passes AB2911(Nunez/Perata) to negotiate drug discounts
  • UPDATE: Some health bills pass, fail: Report on bills’ status in the Legislature

With the legislative session for 2005-06 approaching its final deadline, health care continues to be in the spotlight, with pending bills on everything from universal coverage to hospital overcharging.

On prescription drugs, a major bill to negotiate lower, fairer prices for millions of uninsured, AB2911(Nunez/Perata) passed the full Senate on a straight party line vote and now heads to the Assembly. Some other bills on prescription drug issues, including AB71(Chan) and SB452(Alarcon) both failed. But other health-related measures, including AB1840(Horton) and SB1704(Kuehl) passed and headed to the Governor’s desk.

A fuller description is below. Many of these bills are attempts to help the uninsured, and today there was new information about the extent of the health care crisis in California.


New census data released Tuesday showed the number of uninsured in 2005 rising in the United States, and in California specifically. Of particular note, California was one of eight states to see the proportion of uninsured rise. The likelihood a Californian is uninsured rose to 19 percent of the population, from 18.5 percent in 2004.

That means nearly 1 in every 5 Californians finds themselves uninsured.

With these new numbers, California is in the “top 5” states with the worst rate of residents with health coverage. Only Texas (24.5%), New Mexico (20.6%), Florida (20.3%) have higher rates of uninsured: Oklahoma and California are tied at 19%.

On the national front, the number of Americans without health coverage rose to 46.6 million. The proportion of Americans with employer-based coverage went down to 59.5%, which, according to the Census report, “essentially explains the decrease in total private health insurance coverage, from 68.2% to 67.7%.” While public insurance programs did pick up some of the slack, it was not enough to prevent more people from becoming uninsured.

Other Census numbers for the United States as a whole:

Number of Americans without health coverage
2004: 45.3 million
2005: 46.6 million

Proportion of Americans who receive health benefits from their employer
2004: 59.8%
2005: 59.5%

Number of people covered by government programs
2004: 79.4 million
2005: 80.2 million

Number of people born in the U.S. who were uninsured
2004: 13.1%
2005: 13.4%

Uninsured Whites
2004: 11.2%
2005: 11.3%

Uninsured Blacks
2004: 19.3%
2005: 19.6%

Uninsured Latinos
2004: 32.3%
2005: 32.7%

Uninsured Asians
2004: 16.5%
2005: 17.9%

In this context, the California legislature is set to pass major legislation to assist the growing uninsured population in the next week, and send those bills to Governor Arnold Schwarzenegger. The bills include the landmark SB840(Kuehl), the California Health Insurance Reliability Act, to extend coverage to all Californians through a universal, publicly financed health care system.

Among the financial consequences of being uninsured is that the lack of negotiating power, which means the uninsured end up paying signfiicantly more for care–including prescription drugs and hospital care–than anybody else. The legislature is set to pass major legislation to remedy thig issue:

  • AB774(Chan) would prohibit hospitals from charging more than the Medi-Cal, Medicare, or worker’s compensation rate for hospital care, and provide other consumer protections against abusive billing and collections practices.
  • AB2911(Nunez/Perata) and SB1702 (Perata/Nunez) would create a prescription drug discount program, eventually allowing the state to use its purchasing power to negotiate discounts for the uninsured and underinsured.


In fact, California state senators voted 25-12 to give the state authority to negotiate discounted and fair prescription drug prices for uninsured Californians. All Democrats in the Senate voted for AB2911 (Nunez/Perata).

The bill, which now heads to the Assembly, authorizes the state to negotiate for the best possible price for up to 6 million Californians. The first three years, the program is voluntary, allowing the drug companies to fulfill their promises made last year to make a voluntary program work. However, after August 1, 2010, if drug companies are not participating or their discounts are still insufficient, the state may use the purchasing power of its Medi-Cal program to steer some business away from drug companies that give insufficient discounts.

Senator Perata opened the floor debate by describing the measure as a compromise, after the “shootout on the ballot” last year between Propositions 78 & 79. He cited the potential benefits to millions of uninsured Californians, for discounts of 40-60%.

Senator Ortiz, who proposed a voluntary drug discount program last year, announced that she would vote for the bill, but raised issues about the use of Medi-Cal’s bargaining power to negotiate discounts, fearing it might make it harder for some Medi-Cal recipients to get authorization for the medicines they need. While there are several protections in existing law and in the bill to ensure that all Medi-Cal recipients get access to drugs they need, she asked that future legislators work to ensure protections for Medi-Cal patients.

Republican Sen. Dave Cox called AB2911 and attempt to impose “price caps” on drug companies. “I don’t have to stand here very long to tell you that price caps haven’t worked in the past. the reason we don’t do that is because they don’t work,” Cox said. While AB2911 attempts to achieve up to 60 percent discount off generic drugs and 40 percent off brand name drugs, using verifiable benchmarks such as the best price Medicaid pays, the discounts will be based on the negotiations between the state and the drug companies.

Sen. Jackie Speier, a Democrat, rose to support the bill. Speier had authored the “Golden Bear” program in 2001, which asked drug companies to voluntarily provide discounts for uninsured Californians. “Guess what happened?” she asked. “Nothing.” The Golden Bear program folded for lack of drug company participation. Nothing is going to happen without the use of the state’s purchasing power, which this bill provides, she said. “This is too big a market for them.”

The program would be available for 5-6 million Californians who earn less than 300 percent of the federal poverty level ($60,000 for a family of four); or who have high un-reimbursed medical expenses and incomes below the state’s median family income ($68,310 for a family of four); or whose drugs are not covered by Medicare may qualify.

In anticipation of this week’s vote, a giant, walking pill bottle and volunteers from Gray Panthers, Older Women’s League, Congress of California Seniors, Latino Coalition for a Healthy California, Health Access, California Alliance for Retired Americans, Consumers’ Union, AIDS Healthcare Foundation and Health Care for All distributed more than 1,000 pro-prescription drug leaflets to Capitol staff, lawmakers and lobbyists arriving at work Monday morning and leaving for lunch on Tuesday.


Bills headed to the Governor:

  • AB1840 (Horton) PASSED. Requires the state to disclose names of employers who, rather than providing health coverage, have their workers and their families on Medi-Cal and Healthy Families.
  • SB1704 (Kuehl) PASSED. Extends the sunset for the existing California Health Benefits Review program to 2011.

Voted on Assembly Floor Tuesday: (Need 41 votes to pass)

  • SB452 (Alarcon) FAILING. 34-37. Requires Medi-Cal to report to Governor on whether Medi-Cal prices are higher than prices for federal programs. (Democrats voting against the bill included: Ed Chavez, La Puente; Jerome Horton, Los Angeles; Ted Lieu, El Segundo; Barbara Matthew, Tracy; Nicole Parra, Bakersfield; Leland Yee, San Francisco. Democrats abstaining or absent at voting time included: Ron Calderon, Montebello; Joe Canciamilla, Martinez; Paul Koretz, Hollywood; Gene Mullin, South San Francisco; Gloria Negrete-McLeod, Cino; Alberto Torrico, Newark; and Lois Wolk, Davis.)

Pending on the Assembly Floor

  • SB437 (Escutia) Streamlines enrollment into children’s insurance programs. This bill has been amended significantly, but would make enrollment easier through a WIC Gateway, and by expanding pre-enrollment for Healthy Families for county applications. It will also seek to keep more children retained on the program by simiplying annual renewals to allow self-certification of income for Healthy Families, and creating a pilot for self-certification in Medi-Cal.
  • AB2889 (Frommer) Concurrence. Allows patients in the individual market to transfer to similar health plans without underwriting that would lead to denial of coverage based on “pre-existing conditions.”
  • AB1948 (Montanez) Concurrence. Creates a feasibility study on simplifying application for Medi-Cal and Healthy Families using CHDP Gateway and electronic application.

Voted on Senate Floor Tuesday: (Needs 21 votes to pass)

  • AB71 (Chan/Frommer) FAILED 18-18. Establishes a clearinghouse for information about the safety and effectiveness of prescription drugs that are advertised on television. (Democrats voting against the bill included: Denise Ducheny, San Diego; Dean Florez, Fresno; Mike Machado, Stockton; Ed Vincent, Los Angeles. Democrats abstaining or absent were: Christine Kehoe, San Diego; Kevin Murray, Los Angeles).
  • AB2911 (Nunez/Perata) PASSED 25-15. Allows the state of California to use its Medi-Cal purchasing power to negotiate discounted prescription drug prices for uninsured and underinsured Californians.

Still pending on Senate Floor:

  • AB774 (Chan) Provides consumer protections against abusive hospital billing and collections practices, including those that charge uninsured patients multiple times what insurers pay for the same service.
  • AB1971 (Chan) Extends the sunset for the Managed Risk Medical Insurance Program (MRMIP), which covers patients with “pre-existing conditions” unable to get coverage elsewhere.
  • AB2667 (Baca) Allows the state to monitor Part D prescription drug plans in the same way it monitors health plans.
  • AB2877 (Frommer) Establishes a website listing sources that are safe for purchasing more affordable drugs from other countries.
  • SB840 (Kuehl) Concurrence. Called the California Health Insurance Reliability Act, creates a universal, publicly financed (single-payer) health care system for the state similar to Medicare.
  • SB1405 (Soto) Concurrence. Creates a Task Force on Reimbursement for Language Services to recommend actions for achieving linguistic access to care.

For more information, contact Hanh Kim Quach, hquach@health-access.org, or 916-497-0923.

For more information, contact Health Access:
Sacramento · (916) 442-2308 · 1127 11th Street Suite 234 · Sacramento · CA · 95814
Los Angeles · (213) 748-5287 · 3655 South Grand Avenue · Los Angeles · CA · 90007
Oakland · (510) 873-8787 · 414 13th Street Suite 450 · Oakland · CA · 94612
Health Access California promotes quality, affordable health care for all Californians.
VIEW THE FILE Uncategorized

Leave a Comment

%d bloggers like this: