AB 1x's Demise Prolongs California's Medical Coverage Crisis

January 28, 2008
Contact: Rodney Foo @  (408) 282-8920

"The death of AB 1X in the Senate Health Committee is a missed opportunity to not only provide health coverage to all of California's children and working poor, but to save taxpayer dollars while helping our beleaguered public hospitals," Assemblymember Jim Beall, Jr., D-San Jose, said Monday.

Beall, who supports a single-payer system, had voted for SB 840, a bill to create universal health care through a publicly financed administration. However, the bill was vetoed by the Governor last year.

"The search to provide health coverage for all Californians starts over,'' said Beall, chairman of the Committee on Human Services. "For now, we may have to consider incremental ways to cover our uninsured.''

Last year, Beall authored AB 12, a bill signed into law by the governor that expanded Santa Clara County's first-in-the-nation Children's Health Initiative to include health coverage to 5,000 low-income working adults. The program is funded from contributions by the workers, employers, county, state, and other sources. AB 12 complimented the county's health plan for children, which covers about 130,000 kids.

"We are confident AB 12 is going to work so we need to look at exporting this program to the rest of California,'' Beall said.

AB 1X's demise on Monday means millions of uninsured Californians will have to wait yet another year or more for a solution from Sacramento while they continue to fret over the possibility that their next illness could drive them into bankruptcy.

AB 1X would have covered about 70 percent of the state's uninsured, 3.6 million people, including 800,000 children. The self-funded program called on employers who do not offer insurance to their workers to pay a fee equivalent to 1 percent to 6.5 percent of their annual payroll, depending on the size of the company.

Hospitals would have contributed 4 percent of their revenue. But, the hospitals would have been able to recover that money from matching federal funds. The plan also hinged on voters passing an initiative to increase the cigarette tax from 87 cents a pack to $1.75.

AB 1X would have saved taxpayers millions in indigent care costs by encouraging and enabling the poor to seek preventative care rather than waiting until they are sick and require an expensive trip to the emergency room at public hospitals. In short, it would have reduced the costs paid by taxpayers and the insured to cover those without health care coverage.

"The plan – despite all the criticisms leveled at it – represented a crucial starting point on how to fix our broken health care system and rein in soaring medical costs,'' Beall said.