Health Insurance :: California Health Insurance for All

California Governor Arnold Schwarzenegger announced a proposal that would require all state residents to obtain health insurance and would share the cost among employers, individuals, health care providers, health insurers and the government.

The governor said his plan would control spiraling health costs while ensuring coverage for the quarter of a million children and 5.6 million adults who lack insurance.

“Everyone in California must have health insurance,” Schwarzenegger said via teleconference from Los Angeles, where he is recuperating from a broken leg. “If you can’t afford it, the state will help you buy it, but you must be insured.” Schwarzenegger is betting that his plan will save 10 billion U.S. dollars a year by cutting health care costs.

Highlights of insurance plan

Effect on employers
– Employers who have 10 or more workers and don’t provide medical insurance would be required to pay a 4 percent payroll tax to support a state purchasing pool that would help employees get coverage.

Effect on individuals
– Everyone would have to obtain insurance through an employer or buy it individually. The minimum benefit would be a $5,000-deductible plan with maximum out-of-pocket expenses of $10,000 per family.
– Payment assistance for individual insurance would be available to about 1.2 million low-income Californians.
– The state would provide health insurance to all children, including illegal immigrants, living below 300 percent of the federal poverty level, or about $60,000 a year for a family of four.
– The state would expand Medi-Cal to cover about 630,000 indigent adults not currently eligible for benefits.

Effect on doctors and hospitals
– Medi-Cal reimbursement rates would be increased, but doctors would be required to pay a 2 percent provider tax and hospitals a 4 percent tax.

Effect on insurers
– Insurance companies no longer would be allowed to deny coverage to individuals based on medical history, and they would have to spend 85 percent of their revenue on services.

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