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Nov. 13, 2023 - Epoch Times
29:07
California’s Universal Health Care Explained | Sally Pipes #californiainsider #healthcare
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The government would be the only provider of health care to all people in California, including undocumented immigrants.
The issue is the cost will not come down.
And are the people of California, who are already the highest tax people in the country, how is this going to be paid for?
A number of California legislators are pushing for universal health care system in which everyone will be insured and the whole health care system will operate under state government.
The proponents of this bill argue that it will become cheaper and more accessible.
The critics of the bill are concerned the service will become like a DMV experience with ration care and create a significant tax increase for businesses, which will cause more businesses to leave California.
It means that doctors, many of the top specialists, because their salary would be determined by the state government and it would be a lot lower, they're going to leave the state of California and practice in Nevada and Arizona and Texas and Florida.
And so what are we going to do?
We'll have to become medical tourists.
My guest today is Sally Pipes, president and CEO of the Pacific Research Institute and healthcare policy expert.
Today she explains how the universal healthcare works and its impact on patients and businesses that will fund the system.
Government is not efficient at running things and to put the healthcare system in government's hands I think would be a total disaster.
I'm CMI Korami.
Welcome to California Insider.
Thank you.
It's great to be back.
Yes, we want to talk to you about single-payer healthcare in California.
We are working on a law.
The California Assembly is working on a law to see if this is viable.
Yes, AB 1400 is CalCare.
It's a single-payer bill that Ash Kalra, who is from San Jose, he is a Democrat, very progressive, wants to get this passed.
And then after that, if it passes, Then the Senate will have to vote on it by June 30th.
And then there's a companion bill to AB 1400, which is the funding mechanism.
If you remember, AB 1400 in 2021, it never moved forward because there was no funding mechanism.
And the same in 2017, when SB, Senate Bill 562, It passed the Senate, but it was pulled by the Assembly Speaker, Anthony Rendon, because there was no funding mechanism.
So the new AB 1400 has a funding mechanism, ACA Assembly Constitution Amendment, which is tied to AB 1400, which would be voted on in a separate vote.
Now, the idea is to get rid of all the insurances, health insurances, and just everything will be government-run.
Is that how it would be?
Well, it's not just private insurance.
If this bill passed the Assembly, passed the Senate, then with ACA, the funding mechanism has to go through the Assembly and the Senate, and then to get a two-thirds majority, which will be difficult even when the Democrats...
Have a supermajority.
And if that happens, then by June 30th, then in 2022, this year, in the fall, there would be a proposition, an initiative on the ballot asking the voters to confirm a simple majority for passage of This single-payer.
Single-payer in California, it's not just getting rid on this bill of private insurance.
It's getting rid of Medicare and Medi-Cal, which is the state version of Medicaid.
So all health would be under this one organization called CalCare.
The people that are arguing for this healthcare model, they're saying that our costs will significantly go down.
As a result of it, we can give health insurance to the uninsured, which is 6% of the population in California that don't have insurance.
And also the costs will come down, and they can also increase the benefits.
Because sometimes the health insurance companies don't cover all of the difficult procedures.
So yes, AB 1400, if it became law, the government would be the only provider of health care to all people in California, including undocumented immigrants.
The issue is the cost will not come down.
The cost of...
AB 1400 is close to $400 billion, $391 billion.
The state budget in its entirety is only $286 billion.
So, how are you going to fund that $390 billion, $400 billion?
Well, under the ACA 11, it would involve $163 billion per year in new taxes.
A 2.3% tax on gross receipts of any company over $2 million.
A 1.25% payroll tax that any employer with 50 or more employees would have to pay.
A 1% payroll tax on anyone earning over $49,900 and that would increase.
So, huge tax increases.
It's still $163 billion.
Wouldn't cover $391 billion.
They are hoping that, now that the Democrats are in Congress, that the Secretary of Health and Human Services, Javier Becerra, formerly AG in California, he's a big single-payer proponent, that he would waive the funds from Medicare and Medicaid to come to the state to help fund the...
The single-payer plan.
That would still not be enough to cover $400 billion.
So, you know, you're going to have a huge gap.
And are the people of California who are already the highest tax people in the country right now, and with inflation, with the pandemic, with a lot of people not working, How is this going to be paid for?
Well, if it goes through, as I say, tax increases would be huge.
But the other issue is government would have to decide how much of the state budget they want to spend on health care.
One of the big issues in Canada, where I'm from, is the government spends about 11% of gross domestic product on health care.
The only way they can do that is by rationing care and having long waiting lists for care, denying care.
The same thing would happen in California.
Because there wouldn't be enough funding.
So the cost may come down because government is saying what they're going to spend, but people who are 65 and over are Medicare-eligibles and Medicare citizens are going to find that they can't get the kind of care that they want.
Right now, one in three new Medicare-eligibles can't even find a doctor.
The reason being that doctors are paid about 38% below what they get paid for treating people with private insurance in Medicare docs.
So there's a shortage, so that would be a huge problem.
And it's even the reimbursement rates for doctors who treat Medi-Cal patients is even lower, so a lot of our Medi-Cal patients, even now, can't find doctors.
So care would be rationed for the elderly, and there would be long waits for care.
In particular, in Canada right now, last year, The average wait from seeing a primary care doctor to treatment by a specialist, 25.6 weeks.
That's almost six months.
And if you follow the press and follow single payer, in Canada, the province of Manitoba, just last week, is sending 300 patients From Manitoba to North Dakota for spinal surgeries because the people are in such pain and they're on the waiting list for so long.
300,000 Canadians cross the border every year to pay out of pocket for MRIs, CT scans, hip replacements because the waiting times are just so long.
So this would happen in California.
And then what does that mean?
It means that doctors, many of the top specialists, because their salary would be determined by the state government and it would be a lot lower, They're going to leave the state of California and practice in Nevada, in Arizona, in Texas, in Florida.
And so what are we going to do?
We'll have to become medical tourists to leave the state if the best doctors are gone.
So it's a complete myth that the costs will come down.
There's a financial cost, but there's also a cost to your health if you can't get treatment when you need it.
And you can't get access to the very best of treatments, which we, in California, have so many wonderful doctors and specialists.
So now, some people are saying that, okay, so cutting the health insurance companies out of the equation, and what is the idea?
How do you think the people that are proposing this think that they can save, that they can bring the cost down?
Well, if you get rid of the health insurance industry, all those people are probably going to have a hard time finding new jobs, so the cost of our unemployment will go up significantly.
So the State Department of Health and Human Services would have to hire thousands of people to run the healthcare system.
And as you know, we have so many problems with the DMV, with building the train, the high-speed rail, you know, from Fresno to Bakersfield.
I mean, government is not efficient at running things.
And to put the health care system in government's hands, I think, would be a total disaster.
The record is very bad.
And health care is so important to so many people.
You know, in Canada, when the government took over, The healthcare system, I'm from Vancouver in BC, all the insurance companies were out of business.
One of them thought, well, we'll be the insurer that is actually doing the coverage.
But in fact, they were all completely wiped out.
And so these people have to find alternative jobs.
And as I say, government is not efficient.
At providing services.
And you'll see these long waits.
You'll see ration care.
And a doctor shortage will develop too.
As many doctors will either retire early or they're going to move out of the state of California.
Unfortunately, they have options.
If we had national single-payer health care, which is what Bernie Sanders has spent his life vying to get, if we had that Where would we as Americans go to get the very best health care, which we're so used to?
And in fact, when the polling is done, you know, people in California and people nationally don't vote for a single payer in a highway.
They like their health insurance from their employer.
And we have, you know, in this country, we have most 163 million Americans have employer-sponsored insurance, and they like it.
Now what happens to these hospitals and the whole healthcare system will be owned by the government or is it going to be private entities?
What is the idea?
Well, the hospitals, like in Canada, the hospitals are owned by the government.
And what does it mean when government has control of the purse strings, They're not going to be able to afford to provide the very best in new innovations, which America is so famous for, whether it's CT scans, positron emission tomography machines, even x-ray machines.
So you're going to see very outdated equipment in the hospitals And, you know, we have so many famous hospitals that people come from all over the world, whether it's Stanford, whether it's UCSF, UCLA. These are really top-notch hospitals with very good docs.
But if government is in charge of these hospitals, they're going to have to make significant cuts in order to cover the costs.
And that's going to be a disaster for patients as well.
Now, it seems like the people that are championing this bill are the nurses union, right, that are really, really behind this.
Do they think things are going to get better for them if they do push this law?
How are they thinking?
Oh, the California Nurses Association is a very powerful progressive lobby.
And back in 2017 when SB 562 It passed, but then it was, as I say, it was shelved by the Assembly as being woefully incomplete without funding.
The Nurses' Association was very upset.
Then you move forward to the election in 2018, and Gavin Newsom was elected Governor of California in 2018, had tremendous support from the Nurses' Union, and he said he was a great fan of single-payer health care.
He was really giving in to them in support of the government taking over the healthcare system.
Move forward to today, Gavin Newsom...
Oh, and then he also won the recall election last summer.
And in fact, the nurses' union helped him a lot to win that recall against some people, including Larry Elder, who I'm a huge fan of.
But if you move forward to today, the...
The nurses' union is upset with Governor Newsom because he hasn't come out and said he's in favor of AB 1400.
He said Ashkalra, one of the sponsors of the AB 1400, hasn't shown him the bill.
And in fact, he said, well, I'm waiting for the results of my healthy California for All Commission, which is supposed to report out in February of 2022 on how a single-payer system would be funded.
So he's been playing it very close, and I think he doesn't want to say he's in support of single-payer because he's probably looked at this and he knows the tax increases are significant, and it might backfire on him in his re-election bid.
So he's pushing, in his budget, he announced that In California, he would cover all undocumented immigrants.
So it would include those people who aren't currently covered with Medi-Cal, ages 27 to 49.
That's the group that undocumented immigrants not covered at a cost of About $2.2 billion a year would add another $746,000 to Medi-Cal, our program for low-income Americans.
And as I mentioned earlier, people on Medi-Cal are already having a hard time finding a dot, so it's going to be even worse if you add $746,000.
And I think it'll be a lot more, because if you're unemployed and you're an undocumented immigrant in Arizona or Nevada, Aren't you just going to flock to California because you can get free health care, which is a major part of your expenses?
So Gavin Newsom is very annoying the nurses a lot.
The California Nurses Association, of course, is the big proponent of single-payer, but there are other unions that are very much supporting...
In support of AB 1400, the California Teachers Association, which is a very strong lobby, and you have the California Federation of Labor, the AFL-CIO umbrella for the unions.
They're very much in favor of this.
So I think it's interesting, because in New York State, where there was a single-payer bill there in the Assembly and in the Senate, and it was pulled A year ago because the union members were so upset that they would lose their Cadillac coverage that they get through their unions.
So I'm not sure that the unions in California have really looked at what this would mean for the Cadillac coverage that they get and it also carries through into their retirement.
Are they doing this because it's easier to negotiate with the government than the private entities?
Well, it may be easier to negotiate with government, but government, you know, isn't going to have the kind of money that they're going to need to provide all the coverage that people get.
The Nurses Union, the California Nurses Association, is a very strong lobby, as I mentioned, and they're very, very progressive in the state of California.
I don't know.
I think a lot of the nurses that are these...
The big proponents of single payer are nurses who work in academic institutions, who work for hospitals, rather than the nurses that work in private practice or in clinics for doctors.
When I go to a doctor, if I start talking to the doctor about single payer, the nurses are always like, What's that going to do?
Am I going to keep my job if my employer, my doctor, decides to move out of state or retire early?
They're not for it.
So the nurses' union is very strong among those salaried nurses, union members, in hospitals and academic institutions.
Now, how much of this is about the government controlling all of it, all of the healthcare system here, or giving that 6% people that don't have coverage, health coverage?
Because the bill is kind of proposed that there's a certain portion of Californians that don't have health coverage.
We need to give them health.
But it looks like it will really be a takeover, a government takeover of the whole healthcare system.
Well, it is a complete takeover of the whole healthcare system, getting rid of Medicare, Medi-Cal, and all private insurance in the state.
I think it's a part of the very progressive wing of the Democratic Party in California.
The Democrats have a supermajority in both the Assembly and the Senate, but the progressive wing, really, they want They want government to be in control of our lives.
Remember Hillary Clinton's book, It Takes a Village.
That village is government, and they want the government to be in charge, regardless of what it means for taxpayers, what it means for businesses.
I mean, we're going to see, if this happens, a lot of businesses, many businesses have already left the state of California.
Many more would leave, and as I said, many individuals, families, will also leave the state of California.
They're not going to face These huge tax increases that would be necessary for it.
So I think it's part of their overall agenda for government to run our lives in the state of California.
And California, I mean, remember, this used to be the golden state, and now we're seeing such an outflow of people because of...
Of the increasing role of government.
And when you look at a country like Canada, where there's no private coverage, all healthcare is in the hands of government for anything considered medically necessary.
Government doesn't pay for Lasik surgery or for plastic surgery for me getting a new face or you getting a new face.
So, you know, it's very...
Government has to ration care, and that would happen here.
And the people of California need to be educated on what this bill, if it passed, gets passed by the Senate, they get the funding approved, and then there's an initiative on the ballot in November of 2022, this year, to say that any funding bill has to have a two-thirds majority right now.
But they want it to be a simple majority.
I think the people of California would not vote for that.
But in the meantime, we have to educate so many Californians And Americans in general about what a government takeover of our healthcare system would be.
Because as I say, most people, they rate their employer-based coverage as excellent or as good.
And if you look at the unemployed, you know, it's very interesting.
If you look at the number of people unemployed, first of all, the Obamacare, the Affordable Care Act, Covered California is the state version of Obamacare and anyone can sign up for care.
You can either go on Medi-Cal or you can get a subsidy.
If you're above the Medi-Cal cutoff, you can get coverage through Covered California.
A lot of people just aren't doing it.
They find that even the coverage under Covered California is too expensive.
The other thing is that a lot of people who are already in California are eligible for Medi-Cal, but they're not signing up for it.
And the reason is it's hard to find a doctor.
And in many cases, when they do get an appointment, it takes so long to get an appointment that they think it's bad coverage.
So here we are talking about bringing Medi-Cal, Medicare to all, and it's not going to be A good thing for the people of California.
The problem is, when you get these programs, they're very difficult to get rid of.
And as Milton Friedman once said to me many years ago, he was my mentor and wrote the forward to my first book.
He said, tell me about a program that government set up that is actually closed down, I thought hard.
And he said, I'll tell you, it's the Mohair subsidy program.
So, you know, you get this, and even though it's terrible, and people have to wait, and their care is rationed, Eventually, after many years, they say, well, I guess that's the way it is.
But we have an option.
We can move our businesses, we can move ourselves, and our doctors can leave California and go to a state where they can get paid for the services that they are providing.
Some people are arguing there is a certain percentage of people that don't have health insurance, and it's kind of cruel to not allow people to access the health.
The healthcare system.
While I've heard from some doctors in emergency rooms that they get anybody that comes to the healthcare system, the hospitals have to take care of them.
So can you explain this for our audience?
Right.
So, yes, under federal law, Anyone can turn up at an emergency room and get care, and that includes undocumented immigrants as well.
It's very, very expensive care, and we pay more for our health care if we have insurance to cover the uncompensated care for those people who turn up at an emergency room.
So when someone says to you, you know, I'm too poor, I can't afford coverage, well, these are the people, they can turn up at the emergency room, and it's very expensive care.
Even Michelle Obama When Barack was running for president, she was at the University of Chicago Medical Center, and even she said at the time that it's a bad idea that people can turn up at the University of Chicago emergency room.
It should be there for people who are having strokes, having a heart attack.
It shouldn't be there for people that think they have a sore throat and they don't have insurance.
They need to go to a community hospital.
But there is care for these people, and as I say, we have Medi-Cal, we have the CHIP program for children.
Everyone in the state has an opportunity to get the kind of care that suits them, but the progressives want all that care to be centralized under the state government.
In terms of funding of this bill, you mentioned that businesses over $2 million, they have to pay...
Gross receipts.
So essentially on their sales, so if the company has $10 million...
Not their profit.
So then this is kind of a sales tax on its own on companies, maybe even service companies, right?
Well, and not only that, America is such an entrepreneurial country.
I mean, people like Steve Jobs, he and Steve Wozniak started Apple in their garage and ultimately became very successful.
Look at Bill Gates at Microsoft.
Smart people who are innovative start companies, and they start very small, and then if they're successful, they grow.
But with these kind of $2 million, a 2.5% tax on gross receipts of $2 million is very little.
It's really going to stifle the innovation in the entrepreneurial sector in the state of California.
It's just such a bad idea.
And as we know, so many businesses have moved out of California.
So many of the entrepreneurs, the young entrepreneurs, are going to move out of state.
Even if you look at Elon Musk of Tesla, he's now in Austin, Texas.
If you look at many companies like that, they've moved to Texas, they've moved to Florida.
They move where the environment, the tax environment, is...
It's friendly towards innovation and getting started.
So will the last person turn out the lights in California when there's only people living off the government and there's nobody adding to the pile, which is what we as taxpayers do.
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Say no to Big Tech and subscribe to Epic TV. There is this trend in California that politicians come, promise things, and then by the time it comes to implementing it and it being successful, they already get promoted because they get so much press for the promise they made.
Do you think this has anything to do with this kind of a bill in California State?
Well, you know, I mean, that is one of the sort of bet noirs of politics, I think, is that, you know, it's easy to make promises, but how do you pay for those promises if they become law?
I think a lot of the young politicians, young Democrats, well, even Republicans, too, they start out at, you know, the school board, and then the city council, and then they go to the...
State Assembly and the Senate and then they go to Congress, they go to the House or the Senate, you know, in Washington.
I think, you know, a lot of these people see politics as their future.
They've never been out there making, you know, an honest living and realize how much it costs for government and how much they have to pay in taxes to fund these programs, many of which get cut back because there isn't the funding.
But, you know, it's a great idea.
California has term limits.
And so, you know, we see a number of the people that join the assembly and then when they're term limited out, they go to the Senate or they become dog catcher or whatever.
But there is a move.
Promises are, it's easy to make promises.
It's very difficult to pay for them.
But I think a lot of the California politicians, particularly on the Democratic side, you know, see, you know, getting a lot of media coverage is your stepping stone to moving up to a higher level of office.
In the state and potentially nationally.
I mean, if you look at Javier Becerra, who is the Secretary of Health and Human Services right now, who hasn't really been saying anything, but he started out, you know, in Congress.
He was elected many times.
I think for 24 years he was in Congress supporting single payer.
Then he was elected attorney general after Kamala left the race to run in the federal election.
But these people, they're moving their way up either to high-level jobs in an administration that they support or to move to a higher level of office.
But a lot of press coverage helps people to see their face and say, I think I'll vote for that person, whether they actually understand what that person stands for.
Do you think this bill is going to go through, especially the funding part?
What do you think?
Well, I think AB 1400 might pass the Assembly because Speaker Rendon, who shelved the SB 562 in 2017, I think he thinks now there's a funding mechanism, $163 billion in new taxes.
So he might encourage the Democrats in the Assembly to vote for it.
Also, the Progressive Caucus of the Democratic Party just said...
Earlier in the week that they would not endorse any candidate in the Assembly who didn't vote for Assembly Bill 1400.
So it may pass the Assembly.
If it does, then it would pass the Senate.
But I think that with Newsom not really wanting this, it's obvious he wants to be re-elected and his Medi-Cal expansion for undocumented is the way he sees it going now.
I think it would be very hard to get a two-thirds vote in both the Assembly And the California Senate to pass the funding for the tax increases.
And then, of course, if it went to a ballot, I think it would lose, you know, the simple majority initiative would lose because so many people feel they're already taxed to death.
And the taxes, you know, middle-income people pay taxes.
It's not, you know, the people at the very high end.
They do pay taxes, but the bulk of the tax revenue comes from people like us who are working and paying taxes.
So I'm hoping that it doesn't pass the assembly, but I think it might.
But the funding mechanism is not there, and it would be a disaster for the people of California and their health care, which we have come to realize is terrific in California, and we don't want to lose that advantage.
Now, do you have any other thoughts for our audience?
Just before, you know, you really need to get in touch with your Assembly members and your Senate members, particularly, you know, Democrats who have voted, you know, for Democrats in the past.
They need to realize this is not the solution to solving the health care crisis.
We all want affordable, accessible, quality health care, and you do that by empowering doctors and patients, not empowering the government to be in charge of your health care.
Well, thank you so much.
Thank you.
Thank you so much for watching.
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