The 2010 healthcare reform law sought to extend coverage to millions of uninsured Americans, not just to improve their care but also to promote a more efficient healthcare system. The law left out one large group of uninsured people, however: those who were living in the country illegally. State Sen.
Lara's ambitious proposal, SB 1005, would use state funds to provide insurance benefits to all those whose immigration status render them ineligible for federal aid. For impoverished newly arrived legal residents, and those who are here illegally, it would provide full-scale Medi-Cal, the state's version of Medicaid. Under current law, those individuals qualify only for a scaled-back plan that covers emergencies, pregnancies and some chronic diseases. The proposal would also require Covered California, the state's new marketplace for private insurance policies, to offer subsidized coverage to low- and moderate-income immigrants through a separate exchange.
One rationale for extending coverage to everyone is that the uninsured will obtain treatment regardless, typically when their problems are acute — and costly. Those expenses are passed on to taxpayers and to people with insurance. By offering subsidized policies to the uninsured poor, the state can shift people into preventive and managed care, saving money in the long run.
That's true. But before the state expands its safety net, it needs to repair the rips and tears made during the budget crises of the last recession. Those include the reductions in Medi-Cal payment rates that have shrunk the ranks of doctors in the program, a problem exacerbated by the growing number of Californians enrolling. Although the same discipline to fix programs before expanding them should apply across the budget, it's particularly relevant in healthcare, where the cost per beneficiary has gone in only one direction: up. According to a report released Thursday by UC Berkeley and UCLA, the added cost of just the Medi-Cal portion of Lara's bill would rise from about $360 million in 2015 to about $430 million in 2019.