California’s Single-Payer Healthcare Bill Isn’t Based in Reality

by Austin Yack

On Thursday, the California state Senate passed Senate Bill 562, which seeks to establish a statewide single-payer healthcare system.

Democratic senator Ricardo Lara, the chairman of the Senate Appropriations Committee, co-authored the bill and advocated its passage, but failed to explain how the proposal’s $400-billion price tag will be financed.

The bill represents a key progressive goal, and yet, it will almost certainly never be signed into law — even though Californians have elected Democratic majorities to both legislative chambers and a Democratic governor. Why not? Because it’s absurdly expensive. This year’s entire state budget is $180 billion. The single-payer system called for in 562 costs more than double that.

We don’t have the money to pay for it,” Republican state senator Tom Berryhill said. “If we cut every single program and expense from the state budget and redirected that money to this bill, SB 562, we wouldn’t even cover half of the $400-billion price tag.”

Proponents of Lara’s bill claim that half of the $400 billion in question would be covered by the existing healthcare funds doled out at all levels of government, and the other $200 billion would be raised through increased tax revenues.

But for even this plan to be feasible, the Trump administration would have to approve a waiver allowing California to redirect all funds from Medicare and Medi-Cal to the proposed healthcare system. This is especially unlikely, as California Democrats seek to grant illegal immigrants who reside in California the right to use the state-funded healthcare system, and the Trump administration opposes that. Moreover, California’s legislators haven’t exactly built up a rapport with the new administration. In January, Democratic legislators hired former U.S. attorney general Eric Holder to represent them in lawsuits resisting the Trump administration’s political agenda.

And even if Trump were to sign the waiver, Democrats would still need to raise $200 billion through increased tax revenues, which the majority of Californians vehemently oppose. According to a report released on Wednesday by the nonpartisan thinktank Public Policy Institute of California, 56 percent of California’s likely voters approved of a single-payer healthcare system, but that support fell to 43 percent when asked if they’d support an increase in taxes to fund the system.

Which is to say that if Californians remain opposed to higher taxes — and California is one of the most taxed states in the country — then it will be difficult for legislators to sell either a 15-percent payroll tax, contemplated by the Senate Appropriations Committee, or a 2.3 percent increase in “state sales tax and business receipts taxes,” recommended by the California Nurses Association (CNA sponsored the bill).

It seems that Governor Brown is one of the only Democratic politicians in California to comprehend that a statewide single-payer healthcare system would be catastrophic. Such a proposal, Brown said, “is called ignotum per ignotius . . . In other words, you take a problem and say, ‘I’m going to solve it by something that’s even a bigger problem,’ which makes no sense.”

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