After 10 months, Gov. Arnold Schwarzenegger released the highly anticipated legalese to accompany his 10-page health reform concept paper released in January. This 220-page draft seems to have grown since last week, when a 195-page version was circulating for comments. My colleague Anthony posted comments and analysis about last week’s language — which was not claimed by the governor — here and here and remains relevant to the latest document.
Here’s a quick take on some of the new elements of the plan:
One new wrinkle: All employers — not just those with more than 10 workers — would be required to contibute to employee health care. Businesses would be asked to contribute, based on a sliding scale, of between 1 and 4 percent. AB8 (Nunez/Perata), which is the Legislative leaders’ proposal, requires a 7.5 percent minimum contribution from employers. Ken Jacobs at the UC Berkeley Labor Center explains in this Sacramento Bee editorial why that 7.5 percent figure is important. (Essentially, businesses in the state already contribute an average of 8 percent and we shouldn’t lower the bar and allow businesses to abrogate their current responsibilities.)
Another new thing this week seems to be the addition of revenues from the state lottery. The governor’s idea is to lease the operation of the lottery to a private company (though he specified that the concept did not involve privatizing the lottery), which would — i suppose — sell more tickets and make more money? This idea, Schwarzenegger said, is meant to supplant talk of a sales tax increase.
Lastly, Bill Ainsworth at the San Diego Union Tribune asked the governor about affordability. Under this plan, Californians earning more than 350% of poverty ($72,275 for a family of four), would be responsible for buying their own coverage without any help at all (either subsidies or tax breaks). Such a family — in today’s insurance market — could spend nearly $7,000 a year on premiums alone. The premiums alone are nearly 10 percent of the family income. And that’s for coverage that isn’t that great ($3,000 deductible, $500 prescription drug deduction, and $10,000 out-of-pocket maximum).
The governor conceded that affordability was an issue, “We need to help people especially if it costs more than 5 percent” of their income. All the figures in the current bill, he said, are up for negotiations.
Stay tuned for more….