Organized Labor

The state’s Senate Health Committee rejected the health care bill AB X1 1 Jan. 28 on a 10-1 vote. The vote effectively killed the measure for this year. It will not be brought before the full Senate in time to place a measure on the ballot to approve funding for the $14.9 billion plan, if at all.

The measure was a compromise between Gov. Arnold Schwarzenegger’s plan and the original health care bill authored by Assembly Speaker Fabian Nunez and Senate President Pro Tem Don Perata. The California Labor Federation had been urging the legislature to amend the bill to address issues of affordability, cost containment, and concerns about the bill’s mandate that all Californians purchase health insurance.

Those became the factors that doomed the bill. State Senator Leland Yee, a member of the Health Committee, announced his opposition to the bill on Jan. 22 because it would require individuals to purchase health insurance with no guarantee of affordability or quality of care. The state’s Legislative Analyst Office also issued a report Jan. 22 questioning the sustainability of the program. The measure would raise over $15 billion in new money to expand coverage to just about half of the state’s 6.7 million uninsured through requiring employers to provide a minimum contribution toward their workers’ coverage; getting individual contributions that are related to a family’s income; raising the tobacco tax to $1.75 per pack; imposing a 4 percent hospital fee; drawing down new federal matching funds; and reinvesting state and county savings. Perata said he could not support the plan at a time when California was facing a projected $14.5-billion budget gap. No Republicans on the panel supported the bill, because it would require employers to provide a minimum contribution toward their workers’ coverage.

In announcing his opposition to AB X1-1 January 22, Senator Yee said he was standing up for working families in opposing the measure.
“This bill does not move us closer to the promise of universal healthcare,” said Yee, who is co-author of SB 840, Senator Shiela Kuehl’s single-payer healthcare bill.  “Californians should be extremely skeptical of a law which requires them to purchase insurance, but allows insurance companies to charge any amount for the policy.”

AB X1 1 faced strong opposition from the California Nurses Association, California School Employees Association, United Food and Commercial Workers, Communication Workers of America, League of Women Voters, Gray Panthers, and the Teamsters, among others.  Yee said he came to a final decision on the bill after talking with dozens of rank and file union members who urged him to oppose the measure.

He pointed out that under AB X1 1 all Californians would be required to buy insurance with no caps on premiums, no regulation of the costs of insurance or medical expenses, no maximum deductibles, and no floor on how little coverage you must purchase.  Yee asserted that if individuals do not purchase insurance within 62 days, the Franchise Tax Board would be authorized to collect premiums by garnishment of wages or mortgage liens.

“AB X1 1 doesn’t provide care, but rather just requires individuals to purchase insurance without specifics on how to contain costs,” said Yee.  “It is unethical to garnish someone’s wages or place a lien on their mortgage because they can’t afford to purchase insurance.  This bill is like telling someone who is in need of help, ‘I’m going to give you food, but I’m going to take away your clothes.’ At the end of the day, the person is still poor. Californians deserve a single-payer system that will guarantee real healthcare for everyone.”

Senator Yee spoke at a public forum at the Centro del Pueblo in San Francisco February 2 sponsored by the California Universal Health Care Organizing Project, which supports Kuehl’s SB 840. The forum also featured a discussion of labor’s position on the health care bill by San Francisco Labor Council Executive Director Tim Paulson and a panel of Jodi Reid, Executive Director, California Alliance for Retired Americans; Michael Lyon, Health Committee Co-Chair, San Francisco Gray Panthers; and Renu Tipirneni, a UCSF Medical Student. About 75 people attended the meeting.

Paulson talked about the labor movement’s work for health care reform statewide and in the city. He said that he agreed that single payer was the best solution and that national legislation was needed. The SFLC, along with dozens of labor councils around the U.S., supports HR 676, the Medicare for All health care reform Bill by Michigan Rep. John Conyers. Paulson said that the Healthy San Francisco program that provides health care for the uninsured was like “a mini version of SB 2,” the health care bill by former State Senator John Burton that mandated that businesses with over 50 employees provide health insurance or pay into a fund to provide health insurance. SB 2 was overturned by voters as Prop. 72 in 2004.

“The San Francisco health access plan is as close to universal health care as anything, according to the CNA,” Paulson said. “It is still employer based and keeps insurance companies in the mix, so it’s not yet universal health care but it is a platform towards universal health care, like the bill that was killed in the state Senate.” Paulson noted that Shiela Kuehl supported AB X1 1 up to the last minute before the hearing but, like Yee, voted against it. “Certain things were left out, like cost containment, which is killing people in Massachusetts,” he said. Like AB X1 1, the Massachusetts model forces individuals to buy insurance but doesn’t cap what insurance companies can charge. Paulson called it a “useless piece of legislation.”

Another factor that doomed AB X1 1 (and has held up SB 840) is the requirement in California for a two-thirds vote to pass a budget or any legislation that requires funding. “I’d like to see single-payer pass in a smaller state that doesn’t have the two-thirds vote requirement,” Paulson said.

Senator Yee arrived and was greeted by applause. He told the audience that he decided to oppose AB X1 1 because, “The employer share is capped but not the individual’s share. There is no guarantee of the quality of care. It was a bad bill.”Yee was asked what could be done to pass SB 840, which passed in 2006 but was vetoed by the governor and passed again in the Senate last year. Yee said a massive education campaign was needed to show people that a government administered health care system could be effective. “We also have to get labor fully on board behind single payer,” he said. “I understand the idea of getting part of universal health care but if you get a bad bill it will set back the effort to get universal health care.” He said that one of the dangers of AB X1 1 was that it would take money out of other programs that provide a safety net and that if AB X1 1 fails people who can’t afford it, there will be nothing left.

California Labor Federation Executive Secretary-Treasurer Art Pulaski said that the Federation was committed to passing real health care reform, despite the failure of AB X1 1. “California’s unions have worked tirelessly for years to create affordable health care options for all Californians, and [the] Senate vote will not deter us from that goal. There have been several good elements of AB X1 1 that have led us to believe that our legislators can make real health care reform possible in California.”