Schwarzenegger aims to grant all Californians health coverage

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California Gov. Arnold Schwarzenegger yesterday put forward a plan that if implemented would cover all of the state’s 36 million residents with health coverage to help heal the state’s troubled healthcare system, the New York Times reports. Currently one-fifth of the state’s population is not covered, and at least one million of the 6.5 million not covered are illegal immigrants. Schwarzenegger’s plan would come with a price tag of $12 billion.

Under the new plan, Medi-Cal — state’s Medicare program — would be applied to those earning around 100 percent above the federal poverty line and to children living in homes with family incomes 300 percent above that line. Though adult illegal immigrants have no access to Medicaid benefits in the state, they would continue to have access to health services from their counties and hospital systems within the state, the Times reports.

The plan also would require that employers not offering employees insurance must contribute to a fund that would be used to cover the employed yet uninsured. As a likely incentive to give employers an incentive to offer health insurance, the tax would be applied to businesses with 10 or more workers and would required the contribution of four percent of a company’s total Social Security wages, the Times reports.

As for providers, they would gain from a $4 billion increase in annual reimbursement. But on the flip side they would be taxed a total of two percent (physicians) and four percent (hospitals) to help cover the costs, the Times reports.

The plan has similarities with the one Massachusetts put forward last year which is expected to cover as many as 515,000 of the 550,000 uninsured in the state. The Massachusetts approach has modified a fund that in the past has been used to pay for healthcare for uninsured patients into one that will assist in subsidizing insurance for those unable to pay for it, the Times reports.