Proposed Single-Payer System Could Cost California $400 Billion Per Year


While Congress debates the whens, hows and finer points of repealing and replacing the Affordable Care Act (otherwise known as Obamacare), some California lawmakers want to completely sidestep what Washington D.C. does next with healthcare by completely remaking California's health insurance marketplace. 

Sens. Ricardo Lara (D-Bell Gardens) and Toni Atkins (D-San Diego) want California to go their own way by creating a statewide single-payer system for healthcare. A state financial analysis of their plan, State Bill 562 (otherwise known as The Healthy California Act) reveals the proposed system could cost the state up to $400 billion per year. That would require an additional $200 billion in new tax revenues to create the so-called "single-payer" system proposed by Lara and Atkins. 

California has flirted with single-payer healthcare in the past, but the steep costs associated with remaking the entire health care market in the state has proven to have too high of a price tag in the past. The cost is far higher than the $180 billion available in the general fund, and special fund spending for the budget year beginning on July 1st. 

California employers spend somewhere between $100 and $150 billion on healthcare for its workers every year and in a single-payer system, that money could be made available to help offset total costs. The bill also states that it would pool federal funds from Medicaid, Medicare, the Affordable Care Act as well as other existing funds and subsidies to help pay for the new system. 

Photo Credit: Getty Images


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