Schwarzenegger proposes requiring every Californian to have health insurance

[Herman Munster]

http://www.latimes.com/news/local/la-ex-gov8jan09,0,2093608.story?coll=la-home-headlines

SACRAMENTO -- Gov. Arnold Schwarzenegger today proposed upending just about every portion of the healthcare industry in one of the country's most elaborate efforts at holding down medical costs and expanding insurance to those who don't have it.

Schwarzenegger's plan, which he publicly unveiled at noon, would require employers with 10 workers or more to buy insurance for their workers or pay a fee of 4% of their payroll into a program to help provide coverage for the uninsured.

Schwarzenegger would tax doctors 2% of their gross revenue and place a 4% tax on hospitals. He campaigned for reelection on an anti-tax platform, but his administration argues that so many more people would have insurance that medical providers would make more money.

The governor also wants to ban insurers from refusing to offer coverage to some individuals because of their prior medical conditions. Insurers would also have to spend at least 85% of their premium revenues on patient care, a move that would limit the amount companies spend on administrative costs and profits.

In an effort to cover all Californian children, including ones in the state illegally, Schwarzenegger's plan would expand the state's Healthy Families program, providing insurance to children whose parents make less than three times the poverty level. That works out to about $60,000 for a family of four.

And Schwarzenegger said his plan would require every Californian to have health insurance.

"If you can't afford it, the state will help you buy it," he said, "but you must be insured."

Schwarzenegger called the delivery and payment of healthcare in California "disastrous," noting that nearly 1 in 5 residents is uninsured.

"The problem with that is, of course, that the rest of the people who have insurance pay for them," said the governor. "Those that are fortunate enough to have coverage — we are paying a hidden tax."