Ambitious New Bill Will Create Health Care Price Controls

new bill would allow California to set price controls on medical services

A new bill that would give the state government power over setting price controls on health care costs in California was introduced to the state assembly on Monday. 

The bill arrived at the state capital amid a fierce debate over rising health care costs in the state. Physicians, hospitals and other health care providers are likely to oppose the price controls. The measure  introduced by Democratic Assemblyman Ash Kalra of San Jose, would give the government the ability to appoint an independent commission that would set prices on private health plans, including those offered by employers and purchased by individuals.  

The commission would set rates for healthcare services based on what the governments pays for the same services under Medicare. 

The measure is being backed by several unions who say they're frustrated with the way health care costs are taking up an increasing share of an employee's compensation. Healthcare prices have been pushed higher in recent years, thanks to inflation, expensive new tech, and an aging population that is more expensive to treat. Since 2002, premiums for Californians who purchase health insurance through their employer have skyrocketed by more than 240%. 

However, critics say the price controls would encourage a 'brain drain' in California, pushing talented doctors out of the market, and making it harder for people to see a doctor when they get sick. 

The bill is inspired by a similar model introduced in Maryland where the state determines the rates for health care services covered by commercial health care plans. 

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