yet another attempt by davis to run business out of the state before he's run out on a rail
sacbee.com
Davis approves health care bill
Businesses will need to provide insurance for their workers or pay into a state pool.
By Lisa Rapaport -- Bee Staff Writer
Gov. Gray Davis, fighting for political survival, signed a landmark law Sunday that will require many California companies to buy employees health insurance and extend coverage to more than a million uninsured workers.
The measure, bitterly opposed by businesses, will compel all firms with 200 or more employees to buy medical coverage for workers and their families by 2006. Companies with 50 to 199 employees must purchase insurance for workers by 2007.
Backed by a coalition of unions, doctors, and consumer groups, Senate Bill 2 is by far the most ambitious push toward universal health care since the proposal -- and ultimate failure -- of a national health plan by President Clinton a decade ago.
"Today we take a bold step to reform health care as we know it," Davis told a noisy throng of supporters waving "no on recall" placards during a bill-signing ceremony at the Kaiser Permanente Medical Center in West Los Angeles.
The new law provides coverage for Californians who "work hard and play by the rules," Davis said. "If they go to sleep at night, they should have the peace of mind of knowing if they get sick in the morning they can go and see a doctor."
The vast majority of California's roughly 6.4 million uninsured residents are workers and their families.
But even as AFL-CIO president John Sweeney hailed the law as a "groundbreaking" model other states could follow to cover the uninsured, California business groups criticized SB 2, by Senate President Pro Tem John Burton, D-San Francisco, as a "job killer" and vowed to stop it from taking effect.
"We will have a ballot referendum to repeal this law in November or we will stop it through the courts," said Richard Costigan, vice president of government relations for the California Chamber of Commerce.
Because the law requires companies to pay fees to a statewide health insurance pool unless they buy medical coverage for their workers, Costigan said it is really a tax that has not been approved by the two-thirds vote of the Legislature required by the state constitution.
Opponents of the law have also promised to fight it in federal court.
During hearings on the bill earlier this year, Wal-Mart officials argued that it violates the 1974 Employee Retirement Income Security Act (ERISA). The federal statute lets states regulate health insurance but not employee benefits, which includes coverage workers get on the job, Wal-Mart officials said, calling a federal court fight "highly likely."
Under the new California law, companies must pay at least 80 percent of monthly insurance premiums, leaving employees to pay no more than 20 percent. Low-income workers would contribute only 5 percent of their wages toward the premium.
Employees will qualify for coverage after three months on the job if they worked at least 100 hours each month. Workers who qualify would either get insurance through their employer or a state-run insurance pool.
While the law leaves details of the pool to be ironed out later, it would be run by the same state board that administers the Healthy Families program for low-income Californians. The board will set fees for joining the pool and also determine how much workers should pay out-of-pocket when they see a physician or fill a prescription.
Supporters of the measure have said annual premiums will cost employers roughly $1.5 billion, while opponents have put that price tag as high as $11.5 billion.
While the measure's ultimate cost and the number of uninsured Californians it might cover have been the subject of much debate, few question why the law captured the imagination of politicians in California and elsewhere.
"Voters are nervous about losing their jobs and losing their health insurance," said Paul Ginsburg, president of the Center for Studying Health System Change, a nonpartisan think tank in Washington, D.C. "Even people who have very good benefits look at some of the big companies announcing large-scale layoffs and worry about whether they will be next."
Nationwide, the number of people without health insurance grew 6 percent last year, to 43.6 million, as health insurance premiums soared and more workers lost coverage provided by employers, according to a U.S. census report released last week.
About 6.4 million Californians, or 18.2 percent of the state's population, lacked health insurance last year, the census found.
Davis cited these numbers as a reason to sign SB 2, along with another measure, Assembly Bill 1528, which directs a state commission to study ways to contain soaring health care costs. "My signature on these two bills comes at a critical juncture in our health care system, with both the number of uninsured and health insurance premiums on the rise nationally," Davis said in a prepared statement.
Sponsors of the measure, the California Labor Federation, AFL-CIO and the California Medical Association, called Davis' signature a "historic moment."
"I consider it the third largest piece of health care policy of the last century," said Art Pulaski, executive secretary-treasurer of the labor federation. "We've got Medicare that we passed for the aged. We have Medicaid -- Medi-Cal in California -- for the poor. But until today we had no health policy to provide health care for your average working family in America."
But even supporters of SB 2 were unsure Sunday whether signing the measure would help Davis survive Tuesday's recall election.
"Polls show that voters consistently rank health care as one of their chief concerns, but we are in uncharted territory with this recall," said Anthony Wright, executive director of the consumer advocacy group Health Access.
Whether or not the health bill helps Davis keep his job, the fate of the new law will be very much determined by the outcome of the recall election, said Peter Lee, president of the Pacific Business Group on Health.
"The devil is really in the details. We won't know how much the bill costs or how many people it covers until we see what comes out of the board in charge of setting up the insurance pool," Lee said. "That board is appointed by whoever is governor and reports to whoever is governor."
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About the Writer
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The Bee's Lisa Rapaport can be reached at (916) 321-1005 or lrapaport@sacbee.com. Bee staff writer Gary Delsohn contributed to this report. |
