Assembly Panel OKs Brown’s Worker Health Insurance Bill

Legislation sponsored by Assembly Speaker Willie Brown to require companies with five or more employees to provide health insurance for their workers was approved Wednesday by the Ways and Means Committee.

A 12 to 5 vote sent the measure to the Assembly floor.

Employers would be required to pay at least 75% of the cost of the health coverage with employees responsible for the other 25%.

“The private sector is absolutely capable on a 75-25 cost-sharing basis of picking up the tab for employee health insurance,” said Brown (D-San Francisco).

But small business interests argued that some firms would have to close because of increased costs if the bill became law.

Others Put on Hold

Based on a Hawaii plan that Brown said is working well, the legislation would not take effect until Jan. 1, 1993, in order to give Congress time to enact a national health insurance plan and thus render the Brown plan unnecessary.

In other action, the same Assembly committee sent two other major health insurance bills to its suspense file, which means they are in limbo until the Legislature settles the current state budget stalemate.

One measure, by Assemblyman Burt Margolin (D-Los Angeles), would provide health insurance to an estimated 5.2 million Californians who do not have it now.

The bill’s financing would come from a combination of payroll taxes, revenue from the voter-approved cigarette tax increase and premiums to be paid by beneficiaries of the plan.

Opposing the bill, Assemblyman Eric Seastrand (R-Salinas) declared, “You are tying one more tax to the backs of employers. Some day you’re going to find out you’ve killed the goose that laid the golden egg.”

Catastrophic Illness

The other bill, by Assemblyman Phillip Isenberg (D-Sacramento), would subsidize a catastrophic health care plan for people whose medical histories make it difficult for them to obtain insurance. These include people with AIDS, cancer, heart disease and diabetes.

Funding would come from three sources: $10 million from employer contributions to the unemployment insurance fund, $10 million from employee contributions to the disability insurance fund and $10 million from tobacco tax revenues.

Richard Holober of the California Labor Federation AFL-CIO objected to the proposed use of the disability insurance funding, calling it a “gimmick” that would take money away from disabled workers and give it to insurance companies.