Tensions mount at state Capitol

State Capitol in Sacramento. (Photo: Shuttesrstock)

No one in and around the Capitol knows what will happen; almost everyone is worried.

Republicans in Washington are moving at long last to follow through on their oft-repeated vow to dismantle the Affordable Care Act (ACA).  On Friday the House, along mostly partisan lines, approved the first step of the ACA repeal. The Senate earlier acted similarly.

It could mean as much as a $22-billion hole blown in the state budget.

The prospect of repeal has triggered a mixture of speculation, tensions, caution and dread among California policymakers.

“Approximately five million Californians and 20 million Americans have health insurance coverage they would not have, but for the Affordable Care Act,” Insurance Commissioner Dave Jones said in a written statement. “Thanks to the Affordable Care Act, 91 percent of Californians are now insured.”

Repeal, he added, would expose Californians “to the specter of medical bankruptcy.”

One way or another, California intends to take care of those among its people dependent on government for their health care, but how the state will pick up the pieces if Obamacare disappears is the question.

It’s a big question. With a new $6 billion deficit looming and widespread uncertainty about the incoming Trump administration, there are no easy answers.

“If they go ahead and repeal with no immediate replacement, that would cause a level of chaos that would be hard to undo,” said Anthony Wright, executive director of nonprofit Health Access, which advocates for the expansion of quality health care. “It’s hard to overstate how much is dependent upon federal actions.”

If Obamacare goes, and Washington makes no effort, or only feeble efforts, to come up with a replacement or maintain current funding levels, it could mean as much as a $22-billion hole blown in the state budget.

That might well set up a three-way — perhaps four-way — imbroglio involving Gov. Jerry Brown, legislative Republicans, and Democrats on how to plug the hole.  The Democrats themselves could be split between the more conservative “business” wing and their fellow Democrats.  Such a conflict of priorities could continue for the remainder of the fiscal year: Plug the budget hole somehow, reduce coverage, or (perhaps most likely) come up with a combination of the two?

About 200,000 healthcare and health-care related jobs could be lost in California if the ACA is repealed, according to two studies.

It’s also possible that huge reductions in federal money shipped to California  could result in a  move by the Golden State to, in effect, go it almost alone with its own state-and-federally financed version of Republican Mitt Romney’s everyone’s-covered health care plan operating in Massachusetts.  (CalCare?)

The stakes are high not only in terms of money, but people:  The state Department of Finance estimates in the administration’s budget message that 1.4 million people will be enrolled in the ACA’s Covered California in 2017‐18 and projects that 14.3 million will be covered under Medi-Cal in 2017‐18 — one‐third of the state’s population.

About 200,000 healthcare and health-care related jobs could be lost in California if the ACA is repealed, according to two studies, although the figures are in dispute.

“Our first priority is to prevent catastrophe, rather than digging out from under it,” Wright said. To that end, Wright said, Los Angeles-based Health Access has been holding rallies on behalf of the ACA in Los Angeles and at the Bakersfield office of House Majority leader Kevin McCarthy.

Voters in November approved Proposition 56 to raising cigarette taxes by $2 per pack, with an estimated $1 billion annually going to health care. But it took years to get it through.

“We tried three times over a decade to get a tobacco tax passed,” Wright said. “We will raise one billion dollars with it.  But if Washington winds up cutting MediCal funding as part of ACA dismantling — $17 billion — and on top of that, Covered California funding — $5 billion — we’d have to do the equivalent of 22 tobacco-tax campaigns to replace that money.”

The situation will probably be clearer by the time the annual budget revision in May arrives, if by then there is any decisive action in Washington.

Democrat Jim Wood of Healdsburg, chair of the Assembly’s Health Committee, is especially worried about President-elect Donald Trump’s nomination of Representative Tom Price of Georgia as U.S. Secretary of Health and Human Services.  Republican Price is an avowed opponent of the ACA.

“Price’s perspective is as far away from California’s policies as you can imagine and the nominee’s prior proposals to repeal the Affordable Care Act could roll back years of the progress in providing health care coverage to our citizens,” Wood said in a statement.

Brown’s secretary of health and human services, Diana Dooley, issued a formal and cautious statement:

“There are no immediate changes to Medi-Cal, and DHCS (Department of Health Care Services)  cannot speculate as to any potential changes to the Medicaid program that may occur under a new administration.  DHCS continues to provide services to Medi-Cal beneficiaries according to state and federal law.”

Brown, worried about lower-then-hoped-for state revenues, was similarly cautious in his January 10 budget message to the legislature, declaring:

“A complete repeal of the Affordable Care Act, without a companion replacement program, would not only affect millions of Californians’ health benefits, but would also disrupt the private insurance market. As the congressional deliberations begin, the Administration stands ready to build on what has worked, support changes and efficiencies where appropriate, and play a constructive role to protect and enhance the lives and health of Californians—within the fiscal constraints facing the state.”

The situation will probably be clearer by the time the annual budget revision in May arrives, if by then there is any decisive action in Washington.  In the meantime, traditional skinflint Brown is intent on keeping overall costs down.

In a prepared statement issued on January 10,  Republican Senator Jeff Stone of Riverside County made it clear what he wants:

“… a final spending plan that reigns in spending, protects public safety, makes veterans a priority, assists our senior citizens, helps pay for needed infrastructure improvements, increases funding within existing revenues for the developmentally disabled community, and avoids any attempt to raise taxes.”


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