California Business Roundtable: CA Can't Afford $400 Billion Single-Payer Price Tag
The California Business Roundtable responded to a legislative analysis Monday that said SB 562, a single-payer health care bill by Sens. Ricardo Lara (D-Bell Gardens) and Toni Atkins (D-San Diego), will cost California $400 billion annually to implement. CBRT President Rob Lapsley says "there is no responsible way to pay for this proposal."
"Let’s look at the facts: California’s 2017-18 budget is estimated at $180 billion. We are the highest tax state in the nation, we are growing lower-wage and higher-wage jobs while losing middle-class jobs, unemployment is below 5 percent yet we are already projecting a budget deficit in the short term. We have billions in unfunded pension and health care liabilities, a worst-in-the-nation poverty rate, long-term debt and a growing housing crisis. But now the Legislature wants to consider a 200 percent increase in the state budget. There is no responsible way to pay for this proposal," states Lapsley.
According to the LA Times, the analysis found 3 key takeaways from the proposal:
- SB 562 will cost $400 billion per year to cover all healthcare and administrative costs.
- Half of that annual cost could be covered by existing federal, state, and local funds repurposed to go toward the single-payer system.
- New taxes would be needed to raise the additional $200 billion.
LA Times further reports:
The analysis proposes one scenario in which a new payroll tax on employers — with a rate of 15% of earned income — could supply the new revenue. But the measure itself does not contain a specific tax proposal, and therefore would not, at this point, need a two-thirds vote to approve a new tax.The write-up also notes that a universal healthcare proposal would likely reduce spending by employers and employees statewide, which currently ranges between $100 billion and $150 billion annually. Therefore, the total new spending under the bill would be between $50 billion and $100 billion each year.
“We are already seeing an exodus of low- and middle-income residents from our state. SB 562 is part of an ongoing progressive agenda that will only result in progressively bankrupting California," Lapsley added in the CBRT press release.