SACRAMENTO—Assembly Speaker Fabian Núñez (D-Los Angeles) today gave the following speech to the Assembly Health Committee, discussing his Fair Share Health Care plan:

Thank you Mr. Dymally and members of the Health Committee.

The proposal I am presenting today, the Fair Share Health Care plan, is both a coverage proposal and a reform proposal, because we cannot successfully expand coverage without cost containment and market reform.

6.6 million Californians do not have health coverage for some part of the year.

69% of the uninsured are in families with at least 1 full-time worker.

54% have incomes less than twice the federal poverty level. For a family of four, that’s less than $40,000 annually.

People without insurance get less preventive care, are diagnosed with serious illnesses much later and have poorer health outcomes.

And there is a significant cost shift to everyone else in the system to pay for uncompensated care.

The Fair Share Health Care plan covers the uninsured in these ways:

• Employer Responsibility.

  We ask the 29% of California employers not currently offering coverage to do so or pay a fee into a statewide purchasing pool, where they can get coverage.
  

  I am very aware of the affordability concerns of small business, so we will limit the employer fees to a reasonable percentage of payroll.
  

  I have asked the California Healthcare Foundation for assistance in modeling the fee levels, which will be accompanied by cost containment reforms.
  

  Fair Share Health Care exempts employers with less than 2 employees, any firm with a payroll of less than $100,000 annually, or any firm that has been in business for less than 3 years.
  

• Employee Responsibility.

  We require employees who are offered coverage to take that coverage and pay their fair share. While there is an employee take up requirement, there is not an individual mandate.
  

• Government Responsibility.

  The proposal asks government to pay its fair share as well.
  

  All children in families with incomes up to 300% of the federal poverty level would be eligible for either the Healthy Families Program or Medi-Cal. All children.
  

  Workers with incomes up to 300% of the federal poverty level would be eligible on a sliding scale basis for premium subsidies.
  

• Cost Containment
  

  Health care costs too much, and health care costs grow much faster than wages and the annual rate of inflation, a key reason why many employers have been reducing or dropping coverage.
  

  Fair Share Health Care emphasizes prevention and management of chronic diseases.
  

  A recent RAND study showed that by instituting financial incentives for chronically ill patients taking cholesterol lowering drugs alone, hospitalizations could be reduced by 80,000 – 90,000 annually -- a net savings of more than $1billion.
  

  Fair Share Health Care has MRMIB spearhead the adoption of evidence-based best practice standards for chronic disease in all state administered health care coverage plans.
  

  It calls for a reduction in premiums for employers that institute wellness programs, including anti-obesity and smoking cessation.
  

  To stretch health care dollars further, employers are permitted to institute Section 125 plans so employees can use pre-tax dollars for their premiums.
  

• Insurance Market Reforms
  

  Carriers have to be a part of the solution, too.
  

  Fair Share Health Care maintains the current high-risk pool, but disallows coverage denial based on relatively minor conditions or having used health care services in the past.
  

  The proposal simplifies benefit choices and advances uniform benefit designs in the insurance market so that everyone can make apples-to-apples comparisons when they are choosing a health plan, which results in greater efficiency and quality.
  

This year, we have a rare opportunity to fix the health care system. We have to do it right, but we cannot waste this chance.

The Fair Share Health Care plan is premised on everyone contributing to make our health care system better.

There is an incredible amount of hard work and negotiation ahead of us.

But I am heartened by the fact that this plan, the Governor’s and Senator Perata’s all share many of the same values.

I look forward to working with each of you to make this happen.

I’m happy to answer any questions.