Health system reform effort widens in California

Two Democrats have offered bills without the governor's doctor tax, which physicians oppose.

By Doug Trapp, AMNews staff. June 4, 2007.

Washington -- While California Gov. Arnold Schwarzenegger campaigns for his universal health plan outside of the legislative process, state lawmakers have been working on plans of their own.

Last month, two leading Democratic legislators called for a 7.5% payroll tax to help pay for their health care reform bills. The measures drew immediate criticism from business groups but some support from the California Medical Assn. Schwarzenegger's plan, in contrast, includes a 4% payroll tax on employers with at least 10 workers, plus a 2% tax on physicians' gross revenues.

The Democrats' bills are essentially more limited versions of the proposal Schwarzenegger put forth in January. The measures -- individually sponsored by Assembly Speaker Fabian Núñez and Senate President Pro Tem Don Perata -- passed the health committees in April.

The $10.9 billion Perata plan and $8.3 billion Núñez bill would, like the governor's $12 billion proposal, create an insurance pool funded in part by the state, employers and sliding-scale individual contributions. Unlike the governor's plan, they do not have a physician and hospital tax or increase physicians' Medicaid payment.

The CMA opposes the physician tax proposal and is concerned that Schwarzenegger's 4% payroll tax would not raise enough money to pay for his plan. The association hasn't taken a position on Schwarzenegger's overall plan, in part, because it hasn't been introduced as legislation. "It's still just a slide show," said Lisa Folberg, associate director of the CMA's Center for Government Relations.