Fact Check on AB8

The state Senate just concluded debate on AB8, which passed 22-17.

(Aside: All Republicans and Sens. Lou Correa, D-Anaheim, and Sheila
, D-Santa Monica voted against the bill. Correa is the only Democratic
lawmaker to oppose any health reform measures this year.)

The bill now heads to the Assembly, where I’m sure all 80 lawmakers will want to get up and speak. Lest they planned to crib from Senators, I wanted to set the record straight on some of the erroneous statements made by their colleagues in the red-wing of the Capitol.

Myth: “I cannot remember a bill — either minor or major — that comes before the Legislature without any organization in complete support,” (Sen. Sam Aanestad, R-Grass Valley)

Fact: Last week, AB8 underwent substantial amendments that dealt with controlling the rapidly increasing health care costs, and affordability of health coverage for consumers. After amendments on both those issues surfaced, a number of strong consumer voices — such as Consumers’ Union, Health Access, CalPIRG, AARP, Congress of California Seniors, Service Employees International Union, California Labor Federation, AAFSME and ACORN and other groups moved to support the bill.

Myth: “This plan does nothing to contain costs.” (Aanestad). Sen. Dave Cox, R-Fair Oaks, also alluded to this.

Fact: Amendments added to the bill last Wednesday directly address the issue of cost containment — something that the It’s OUR Healthcare coalition has been asking for all year. We recognize that without without controlling costs, any health reform efforts would collapse under the weight of increasing health care expenses.
Cost containment provisions include:

  • Preventing Californians from getting sicker by helping patients to affordably control chronic diseases. Asthma, diabetes and heart disease are among the biggest cost drivers in health care. Preventing and maintaining these diseases keep patients from getting sicker, and costing more money to treat. This means reducing co-pays and cost-sharing for doctor’s visits, lab tests and medications. High cost-sharing deters patients from seeking the necessary treatment and care for their diseases, causing their conditions to worsen.
  • Requiring public reporting on health care costs, and the quality of services. By publicly reporting how well – or poorly – doctors, hospitals and other providers perform health care procedures, providers would be driven to improve quality, thereby saving lives and saving health system dollars. Better information on quality and cost can allow purchasers and consumers effectively purchase care that gives them value for each dollar they spend.
  • Requiring the adoption of health information technology. Electronic records could help reduce costly errors due to poor handwriting, unclear instructions and other human errors. Technology could also help cut down on administrative costs.
  • Reining in prescription drug costs. Prescription drug costs climbed an average three times higher than the rate of inflation from 1994 to 2006. AB8 allows the state to combine with other public entities and trust funds to create a purchasing program for prescription drugs, using the power of a larger group to help leverage lower prices for prescription drugs.
  • Creating a public insurer that would compete for business with private insurers to help drive down costs. The public insurer, built on the foundations of California’s existing local initiatives, county-organized health systems, public hospitals and community clinics, would give Californians the option to obtain coverage from a publicly owned entity, such as a municipal utility.

Myth: Sen. Aanestad, in his speech on the Senate floor opposing AB8, also said the bill was “modeled on the Massachusetts plan.”

Fact: While AB8 certainly share certain features with the Massachusetts plan, one missing provision is glaringly obvious: the absence of an individual mandate. AB8 does not require anyone to have coverage if they can’t afford it.
Here’s how it would work: workers would be required to take up health coverage IF their employer pays for it and IF — BIG IF, HERE — the cost of health care (that includes premiums and out-of-pockets costs) does NOT exceed five percent of a worker’s wages. That means a worker earning $41,000 a year would not have to pay more than $2,050 in premiums, co-pays, co-insurance and deductibles.

Health Access California promotes quality, affordable health care for all Californians.
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