The far-left state of California is looking at the possibility of a single-payer health care system. But there is a massive problem facing them: such a program would be bigger than the entire state budget.
Yes, you read that correctly.
According to The Sacramento Bee, a couple of Democratic state senators are attempting to advance a bill creating a single-payer health care system. However, the Senate Appropriations Committee concluded that establishing a single-payer system would cost the state $400 billion. The state's budget for the upcoming fiscal year is currently at $183 billion.
In other words, a single-payer health care system would cost twice as much as California's entire state budget.
The bill would cover all state residents — including illegal immigrants — and provide free health care without any co-pays or deductibles whatsoever. Additionally, a nine-member panel would oversee the system.
Here are more highlights of the bill: (H/T: California Political Review)
- Covers Californians for all medical care, including inpatient, outpatient, emergency care, dental, vision, mental health, and nursing home care.
- Eliminates co-pays and insurance deductibles
- Californians can choose their doctor from a full list of health care providers, not a narrow network chosen by insurance companies.
- Referrals are not required for a member to see any eligible provider.
- Californians are covered when they travel.
- Physicians and nurses will make decisions about care, and have the ability to override computers or clinical practice guidelines in the best interest of the patient.
- Healthy California will be governed by a nine-member, unpaid board appointed by the governor and Legislature and a public advisory committee of doctors, nurses, other health care providers, and consumers.
- Healthy California will cover comprehensive health care, and insurance companies cannot offer benefits for services covered.
- Healthy California will not disclose personally identifiable information to the federal government about members’ religion, national origin, ethnicity, or immigration status for law enforcement or immigration purposes.
- The board will develop proposals related to long-term care, retiree health care and health care services covered under worker’s compensation.
- Healthy California will provide premium assistance for Medicare Part D for eligible members.
Taking all that into account, it shouldn't be that surprising that the bill has such a high price tag.
Other states that have attempted to implement single-payer health care systems faced similar problems of taxpayer costs: (H/T: Reason)
Just last week, we reported on a similar single-payer proposal in New York State, which would require doubling (and possibly quadrupling, depending on which projection you believe) the state's tax burden. Vermont's attempt to implement a single-payer health care system collapsed in 2014 because the costs were too high. Colorado voters rejected a proposed single-payer system in 2016 when faced with the prospect of increasing payroll taxes by 10 percent to meet the estimated $25 billion annual price tag.
California already faces a $1.6 billion budget deficit this year, but the state's debt problems are actually much worse than that, as the state faces unfunded liabilities of almost a trillion dollars. Given that the Tax Foundation has already ranked California as having the sixth-highest tax rates in the nation, the ensuing tax rates from implementing a single-payer health care bill system would be even more onerous and cripple the state's economy.
The problem with creating utopia is that reality eventually kicks in and the attempted utopia turns into a living nightmare, which is why states that have tried to implement single-payer have failed to do so. The price tag of the bill being put forward in the state senate suggests the same will be true for California.