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Los Angeles Times
By Lou Cannon
January 7, 2007
Arnold Schwarzenegger used to be compared to Ronald
Reagan, another Hollywood actor who starred on the political
stage in Sacramento. Lately, Schwarzenegger's enthusiasm
for bond issues and freeways has been more reminiscent
of Pat Brown, the builder-governor who preceded Reagan.
But on Monday, when Gov. Schwarzenegger unveils his ballyhooed
plan to provide health insurance for 6.5 million uninsured
Californians, he will invite comparison to the legendary
Gov. Earl Warren, who in 1945 put forth a visionary plan
offering state-subsidized medical insurance for all but
the wealthiest Californians.
Until now, Schwarzenegger has been more the anti-Warren.
Last year, he vetoed a bill providing for a government-run
health system, saying, "socialized medicine is not the
solution to our state's healthcare problem." He also
has been the anti-Reagan and the anti-Brown, governors
who shared a willingness to raise taxes to pay for programs
they believed were necessary. Schwarzenegger came to
office vowing not to increase taxes, a promise he renewed
last year during his reelection campaign.
Ever since a healthcare summit at UCLA in July, however,
Schwarzenegger has been promising to tackle the challenge
of California's inefficient health system, which the
governor maintains is "broken." A recent study by the
Public Policy Institute of California found that 25%
of adults in Los Angeles County have no insurance coverage.
Private employers, faced with rising costs, are reducing
or eliminating healthcare coverage for employees. Uninsured
and underinsured patients jam trauma clinics and emergency
treatment centers, some of which have closed because
of financial pressures. Only 75 such clinics and centers
remain to serve the 10 million people of Los Angeles
County, according to the state Health and Human Services
Agency.
In his speech in Sacramento on Monday, Schwarzenegger
will propose what Kim Belshe, his Health and Human Services
secretary, calls a "comprehensive plan" with "shared
responsibility" for controlling costs and expanding health
coverage among individuals, employers, the government,
and medical providers and insurers. In an interview,
Belshe reiterated the governor's message that the insured
pay a "hidden tax" to provide coverage to the uninsured.
According to a study by the nonpartisan New America Foundation
on which the Schwarzenegger administration has relied,
this tax amounts to an extra $1,200 a year in premiums
for the average California family.
Schwarzenegger and his aides, hemmed in between the governor's
opposition to a state-run system and to new taxes, have
been struggling for months to come up with a politically
achievable plan. Except for disclosing that it will cover
the state's 750,000 uninsured children, including children
of undocumented immigrants, the governor has been vague
about the specifics and the price tag of his plan.
"Who pays? — that's always the question," said
Allan Zaremberg, president of the California Chamber
of Commerce. The chamber, often a supporter of the governor,
opposes requiring employers to provide healthcare coverage
on the grounds that most small employers can't afford
it.
With healthcare costs rapidly escalating, the devil is
necessarily in the details of any reform proposal. Administration
officials acknowledge that a significant amount of "new
money" will be needed, some probably from the state's
general fund, but they also have suggested that money
used to care for the indigent may be redirected toward
buying coverage for the uninsured.
Adam Mendelsohn, the governor's communications director,
declined to say whether Schwarzenegger's plan would include
new fees or charges, but health industry sources said
the governor's team has discussed a "provider tax" for
physicians and hospitals.
Schwarzenegger's newfound interest in healthcare reform
is an about-face from his previous policies. In 2005,
he vetoed as too costly a Democratic bill that would
have provided health coverage to children whose families
earned up to 300% of the federal poverty level — $50,000
a year for a family of three.
Since then, however, Massachusetts has moved aggressively
in the direction of universal healthcare coverage. A
bill proposed by outgoing Republican Gov. Mitt Romney,
and passed by the state's Democratic-controlled Legislature,
became law in April. It requires individuals to buy health
coverage and employers to provide the coverage, and it
imposes tax penalties for noncompliance. Vermont and
Maine have since passed similar laws.
But covering the uninsured is a more daunting problem
in California. In Massachusetts, only 10% of the population
is uninsured, compared with an estimated 17% in California,
where a higher percentage of the uninsured is below the
poverty line. By the same token, a California solution
to healthcare could set a national example.
"It's like greenhouse gases," said William Hauck, president
of the California Business Roundtable, referring to legislation
that Schwarzenegger signed to curb global-warming emissions. "Schwarzenegger
sees the federal government as not stepping in and doing
anything productive. He wants to prove it's doable in
a nation-state and thereby leave a constructive legacy
as governor."
To achieve this legacy, Schwarzenegger will have to stand
up to the legislative wing of his party, far more conservative
than he is on most issues. Many Republican state legislators
oppose extending health coverage to the children of undocumented
immigrants. California's archaic legislative rule requiring
two-thirds approval for bills with a financial impact
allows the minority Republicans to be spoilers, if they
want to be.
Schwarzenegger also will have to placate the Democratic
majority, with whom he worked well in 2006. Democratic
Assembly Speaker Fabian Nuñez (D-Los Angeles)
has his own healthcare bill and has opposed forcing individuals
to buy health insurance.
Republican Gov. Warren, at the height of his prestige
in 1945, was so popular that he would a year later win
both the Republican and Democratic nominations for governor.
But when he offered a plan that would have provided state-subsidized
healthcare and up to 21 days of hospitalization for about
two-thirds of Californians, he was treated as a crackpot,
and his bill was buried in committee.
After the Warren experience, most California governors
avoided healthcare issues until Pete Wilson created a
program known as Healthy Families to finance medical
care for poor children. Even Wilson's relatively modest
proposals were twice rejected by the Legislature before
they were enacted, another reminder of the difficulty
of making progress on healthcare reform.
Schwarzenegger, however, is buoyed by newfound public
support for efforts to fix a system that voters agree
with him is broken. In a Field Poll last week, more than
eight in 10 California voters expressed the view that
government should guarantee that everyone can obtain
affordable health coverage. It is a tantalizing prospect,
but history teaches that it will not be easy to translate
this expectation into reality.
Lou Cannon is the author of five books on Ronald
Reagan, most recently "Governor Reagan: His Rise to
Power."
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