New Study Finds Health Care Proposals Insufficient to Protect Californians

[courtesy of California Progress Report]

By Hayley Leventhal
Reporter
California Progress Report

With 6.5 million uninsured Californians, both Governor Schwarzenegger and the legislature have placed an emphasis on health care reform this year. However, current state proposals to reform health care do not sufficiently protect California’s families, experts say. A new study, “What Does It Take for a Family to Afford to Pay for Health Care?”, coauthored by the California Budget Project (CBP) and the UCLA Center for Health Policy Research finds that in order to ensure adequate health care for Californian families, the state will need to provide assistance to families making up to almost $62,000 a year.

“A necessary part of health care reform is ensuring that families have healthcare that they can actually use, and that they can realistically afford along with their other basic living expenses,” said David Carroll, the research director of the CBP. “In the midst of complicated health reform discussions, we shouldn’t lose sight of what families can realistically afford to pay for healthcare.”

Full health care benefits are not realistically affordable, the study found, for those making up to three times the federal poverty line. Over 4.8 million Californians live in poverty, according to the U.S. Census Bureau, and that number does not account for the millions living out of poverty but remain unable to afford adequate care. It is not until a two income family of four begins earning almost $62,000, or 300% of the poverty line, that they are able to fully fund health care premiums.

The current proposals for health care reform do not meet these numbers. “The Governor proposes subsidies to 150% of the poverty line, which is lower than what we propose. AB 8…proposes subsidies up to 300%; however, the actual level of those subsidies is not clear up to this point. And it’s not clear if full subsidies would go all the way up to two times the poverty line as we propose,” Carroll said.

Furthermore, neither AB 8 nor the Governor Schwarzenegger’s proposed health care plans include spending limits on “out of pocket expenses”. These expenses, the report says, create a financial burden even on families able to afford insurance premiums.

“Most individuals in the private market, whether they purchase the insurance themselves, or whether they receive insurance through their employer…most policies do not have spending limits, and this is one of the reasons why there are so many personal bankruptcies in the Unites States for people who are already insured… Despite their insurance, they can still, as our studies show, have large expenditures because of the out of pocket responsibility and the lack of limits on out of pocket spending,” said Gerald Kominski, associate director for the UCLA Center for Health Policy Research.