Riverside Press Enterprise
January 9, 2007

Health care for all

Governor wants illegal immigrants covered; opposition builds

By JIM MILLER and LORA HINES
The Press-Enterprise

SACRAMENTO – Gov. Schwarzenegger charged headlong into revamping California's health-care system Monday, unveiling a $12 billion plan that would require everyone to carry insurance and extend subsidized health coverage to undocumented immigrants.

The Republican governor's plan takes aim at the many parts of a health-care system that leaves an estimated 6.5 million people without insurance coverage, including about 750,000 in Riverside and San Bernardino counties.

"Even though everyone has to chip in, at the end the way it works is everyone is left with a better deal," Schwarzenegger said, speaking by video from Los Angeles, where he is recovering from a broken leg.

Various groups, though, quickly began raising concerns about parts of the plan. Doctors and hospitals, for example, objected to paying a "coverage dividend" to the state, while labor unions and consumer groups oppose the requirement that everyone carry insurance.

The governor's fellow Republicans, meanwhile, complained that the proposal is too onerous on business and could be a magnet for illegal immigrants.

"We cannot make ourselves noncompetitive with other states where our jobs can go," said Assemblyman John J. Benoit, R-Bermuda Dunes.

The proposal would require health plans to spend 85 percent of payments on patient care. There would be incentives for overweight residents to lose the flab and for smokers to kick the habit.

It would penalize employers with more than 10 workers who do not offer health insurance. The state, meanwhile, would significantly increase Medi-Cal reimbursement rates to encourage more doctors to treat patients enrolled in the program.

The proposal still must be considered by the Legislature.

Schwarzenegger is expected to discuss his plan more today during his State of the State address in Sacramento. More details likely will emerge Wednesday, when he releases his 2007-08 budget proposal.

The Legislature's majority Democrats generally reacted favorably to the plan.

State Sen. Denise Moreno Ducheny, D-San Diego, called the proposal "a good beginning of the conversation."

Ducheny, who represents part of Riverside County, raised concerns about making every Californian carry insurance. The plan requires minimum coverage of $5,000. The administration estimated that such coverage could be obtained for $100 or less per month.

"What do we subsidize and what do we really ask from people, especially in high-cost housing markets?" she said.

Revenue Sources

The $12 billion annually to pay for the proposed health-care plan would come from different sources.

Administration officials expect to get almost $5.5 billion in new federal money to expand the Healthy Families insurance program for children, to pay for Medi-Cal rate increases and for Medi-Cal coverage of parents.

In addition, the state would charge a "coverage dividend" on doctors and hospitals, generating an estimated $3.5 billion; hospitals would pay 4 percent of revenue and doctors would pay 2 percent of revenue.

The state also would use $2 billion that now goes to county health care. Another $1 billion would come from employers with more than 10 employees who do not offer them health insurance.

All uninsured children, regardless of immigration status, would be eligible for subsidized health coverage.

Of the estimated 1 million adult illegal immigrants, the governor's plan predicts about 40,000 would get health coverage from their employers and another 160,000 would buy individual coverage. The rest would get it from their counties.

Assemblywoman Bonnie Garcia, R-Cathedral City, criticized the idea.

"Who do you cut in front of in line to do it? We need to be talking about people who are working two jobs and losing their health care," she said

People who oppose health care for illegal immigrants are in denial, said Schwarzenegger.

"Federal law requires us to treat everyone who shows up in an emergency room and needs care," he said. "The question is not do we treat them or not treat them. The question is how do we treat them in the most cost-effective way?"

Inland Reaction

Inland health officials said they want to see more specifics.

Harry Friedman, executive director of First 5 Riverside, said he likes the plan because it would cover all the state's uninsured adults and children. Riverside County has an estimated 57,000 uninsured children, Friedman said.

"The issues are the details," said Friedman, whose agency provides education, childcare and health care funding for children up to 5. "On a conceptual basis it all sounds good. But can it be implemented?"

Richard Jarvis, executive director of San Bernardino County's Children's Health Initiative, said he supports the governor's attempt at broad health-care change. The county has an estimated 53,000 uninsured children. Jarvis said it would cost $53 million to insure all of them.

"The money's just not there," said Jarvis, who also is executive director of First 5 San Bernardino. "The expansion of reform is really what's needed. I think (the governor) is on track by looking at the whole thing."

Richard Bruno, chief executive officer of the nonprofit Inland Empire Health Plan, said he still was studying the proposal. "This is a major undertaking," he said.

Bruno, though, said he supports the governor's attempt to reward healthy behavior. But he questioned how the plan could cover everyone and how it would be adjusted for inflation.

"Overall, it's headed in the right direction," he said. "It's a good thing to get all kids covered."

Doug Bagley, chief executive officer of Riverside County Regional Medical Center, said the proposal includes issues such as personal and employer mandates, limits on insurance companies, health-care provider taxes and county funding.

"I can't say whether all the numbers will pencil out. I'm a little surprised it is this big," he said. "The governor doesn't shy away from taking on controversial issues. It may be a better system."