CLFP Opposes Single-Payer Health Care Proposal

CLFP has joined with the California Chamber of Commerce and a large coalition of business organizations in opposition to SB 562 (Lara; D-Bell Gardens/Atkins; D-San Diego), which creates a new single-payer, government-run health care system. Although the financing mechanism for SB 562 has not yet been specified, past legislative attempts at government-run health care have proposed major increases in payroll and income tax on businesses and individuals.

In 2008, the California Legislative Analyst’s Office (LAO) estimated that sustaining a single-payer system in California would require more than $210 billion in the first year, an amount increasing up to $250 billion in subsequent years. Even with the 12% tax on employers and employees under the 2008 measure, the LAO report predicted a net shortfall of $42 billion in the system’s first full year of implementation and even higher thereafter. Just to cover the shortfall, the LAO estimated a tax of 16% on employers and employees would be needed, resulting in a multibillion-dollar tax increase on Californians.

California voters have twice rejected a government-run health care system in 1994 and 2004. Past focus groups and numerous opinion polls on health care reform have reinforced that California residents do not want a single-payer government-run system.

Although the legislation’s goal of providing health coverage for all Californians is a laudable one, establishing a single-payer statewide bureaucracy is the wrong approach. CLFP and the coalition opposing SB 562 fundamentally disagree with the bill’s two major premises that government systems are more efficient than private business, and that a single-payer system would be less costly than the current private system.

SB 562 passed Senate Health on April 26 and will be considered next by the Senate Appropriations Committee.

By Trudi Hughes, CLFP Government Affairs Director