CALPIRG Blog

Naysayers were starting to say that 2007’s year of health care reform was going to end without any major changes being made, but there's been some good news.  On Tuesday, the leaders of the California legislature released their proposal for reform, and while some of the details are still being nailed down, there’s a lot there to like.

At a legislative hearing last week, we told the Assembly that health care reform had to contain costs, expand coverage, and give consumers a fair shake when buying insurance – and it looks like the Speaker was paying attention.

The plan would expand subsidies for those who need help buying insurance, make sure employers contribute to providing coverage for their workers, and cut costs through the bulk purchasing of prescription drugs.  And it couples a requirement that Californians have insurance with an exemption for people who would pay too much of their income on health care, so that the only people mandated to buy insurance are those who can afford it.

One of the most important parts of the Speaker’s proposal, though, isn’t about what’s in the reform, but how to pay for it.  Fixing California’s broken health care system is going to take money up front.  The Speaker’s suggested a common-sense solution for closing the gap – a two dollar a pack increase in the tax on cigarettes.

There’ve been lots of ideas about how to fund health care reform, and some have been better than others.  Businesses are being asked to contribute on a sliding scale, with bigger employers shouldering more of the burden, but that isn’t enough. The Governor proposed leasing out the state’s lottery to a private company a few weeks back, for example – a risky move that would have required some financial shell games, and which would have dried up after twenty or thirty years.

The tobacco tax is much smarter.  It makes sense to finance health care by using one of the unhealthiest products around.  Plus, higher cigarette prices are a proven way of reducing smoking – especially teen smoking.  The tobacco tax will raise money for health care, and because nonsmokers tend to have fewer health issues than smokers, it will also lower costs and make Californians healthier.