A California plan for a single-payer health plan crawled forward in the state Senate as a new study by a nurses union disputed a state analysis that the proposal would cost $400 billion annually and blow up the state's budget.
The bill, SB562, would guarantee health coverage with no out-of-pocket cost for all California residents, including people living in the country illegally. It was to be heard in the Senate Health Committee on Wednesday.
The new study by the California Nurses Association/National Nurses United sought to beat back an earlier analysis by the state that its proposed government-run single-payer plan would cost a jolting $400 billion annually – more than the entire California state budget, reported the Los Angeles Times.
The study by the University of Massachusetts Amherst's Political Economy Research Institute, which was partly funded by the union, estimated that the plan would cost $331 billion as of 2017 and any extra cost would be covered by a new gross receipts tax and sales tax, wrote the Times.
"The study finds that the providing full universal coverage would increase overall system costs by about 10 percent, but that the single payer system could produce savings of about 18 percent," said the study's abstract.
"The study thus finds that the proposed single-payer system could provide decent health care for all California residents while still reducing net overall costs by about eight percent relative to the existing system."
The nurses' union said the study found that 7.5 percent of Californian remained uninsured under the Affordable Care Act while another 36 percent – an estimated 12 million people – cannot access their health care because of high premiums and out-of-pocket costs.
"What this new study proves is that we can finally achieve the dream of guaranteeing health care for all Californians, without the punishment of crippling out of pocket costs, at far less than what was predicted by those who make enormous profits off the pain and suffering of everyday Californians," RoseAnn DeMoro, the nurses' union's president said in a statement.
State business groups, though, have called the single-payer proposal a "job killer," including the California Chamber of Commerce, said the Sacramento Bee. Insurance groups, health plans and Kaiser Permanente have said that legislators would be better served by improving on the Affordable Care Act.
"A single-payer system is massively, if not prohibitively expensive," Nick Louizos, vice president of legislative affairs for the California Association of Health Plans, told the Bee.
Jake Novak, senior columnist for CNBC, said the California single-payer plan will do more to throw cold water on the idea than anything detractors can say.
"But now California has given the public solid reasons to really fear single payer because it's obvious how much we'd all have to sacrifice to get it," said Novak. "Those who want more government paid health care must now be forced to explain what other key rights and expenditures need to be sacrificed for that dream."
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