Legislation proposed to help California launch healthcare overhaul

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SACRAMENTO — The state Legislature gaveled in a special session on healthcare Monday, pushing forward with sweeping proposals to help California implement President Obama’s healthcare overhaul.

The measures, including a major expansion of Medi-Cal, the state’s public insurance program for the poor, would cement the state’s status as the nation’s earliest and most aggressive adopter of the federal Affordable Care Act. Beginning in January 2014, the law requires most Americans to buy health insurance or pay a penalty.

Gov. Jerry Brown called the special session so healthcare bills that he signs can take effect within 90 days rather than next year.


State lawmakers are racing to pass rules for enrollment in a new state-run insurance market in October. They include a requirement for insurers to cover consumers who have preexisting medical conditions.

Legislative leaders in both houses sponsored bills that would dramatically expand Medi-Cal. Under the proposals, individuals earning up to 138% of the federal poverty level — or $15,415 a year — would be covered, potentially adding more than 1 million Californians to the rolls.

The federal government would subsidize costs for the first three years, phasing down to 90% afterward.

“Ensuring that every Californian has access to quality, affordable healthcare is one of the most important public policy challenges we face,” said Assembly Speaker John A. Pérez (D-Los Angeles) at a Capitol news conference. “No Californian should ever face bankruptcy or severe financial setbacks due to illness and injury.”

Brown, in his State of the State speech last week, sounded a note of caution even as he embraced the federal law. The long-term costs are unknown, he said, and hold the potential to undermine California’s precariously balanced budget.

He called the Medi-Cal expansion “incredibly complex,” adding that “it will take more time” to achieve than other parts of the healthcare overhaul. Brown has said the change could allow the state to reduce the roughly $2 billion it gives to counties to care for the uninsured, but county officials and healthcare advocates say that such a move could hurt their ability to help the millions of Californians who will still lack coverage.


The special-session legislation would also streamline the Medi-Cal enrollment process to help sign up hundreds of thousands of Californians who are currently eligible but not enrolled. According to a recent study by the UC Berkeley Center for Labor Research and the UCLA Center for Health Policy Research, that change could add 240,000 to 510,000 people to the Medi-Cal rolls by 2019.

Brown has earmarked $350 million in his budget proposal to pay for the increased participation. Costs for the currently eligible group would be split evenly between the state and federal governments.

For all their enthusiasm, legislative leaders also said they were working within fiscal constraints. Pérez defended the state’s moves, for instance, to slash Medi-Cal reimbursement rates two years ago. Healthcare providers have appealed a federal court’s decision allowing the cuts, arguing that the reductions would cause community clinics to close and prompt doctors to turn away Medi-Cal patients.

California, Pérez said, lacks the resources to better compensate doctors, hospitals and pharmacists.

“I don’t think we’re in a situation to make fundamental changes to that,” he said.