SACRAMENTO – By an 11-4 vote, the Assembly Health Committee today approved Speaker Fabian Núñez’s (D-Los Angeles) and Senate President pro Tem Don Perata’s (D-Oakland) comprehensive health care reform, Assembly Bill 1X.

“California is one step closer toward being a national leader in fixing our broken health care system,” Speaker Núñez said. “This legislation is based on the principle of shared responsibility between government, individuals, hospitals and employers.”

“The Assembly Health Committee's hearing and vote today is another step in the right direction,” Senator Perata said. “This legislation represents a fair and reasonable effort to meet the Governor's concerns while still achieving our primary objectives. Our plan extends health insurance to millions of Californians who have none, reins in runaway medical costs and guarantees coverage for people with pre-existing illnesses.”

Audio of the Speaker’s opening statement is below.

The new Democratic bill includes the core principles of Assembly Bill 8, the Democratic plan vetoed by the Governor last year, while meeting the Governor halfway on other key elements of health care reform. Specifically the health care plan:

• Establishes an individual mandate for most Californians but exempts people who cannot afford to purchase insurance. Affordability is met when the total cost of health insurance is 6.5% or less of a family income.
• Covers all children and parents up to 300% of the federal poverty line.
• Covers all single adults through Medi-Cal up to 250% of the federal poverty line.
• Provides individuals with incomes 250-450% of the federal poverty line not eligible for public programs with an advanceable, refundable tax subsidy to help purchase coverage.
• Ensures that nobody earning between 0-150% of the federal poverty line will be required to pay premiums, co-payments, or deductibles.
• Requires the Managed Risk Medical Insurance Board (MRMIB) to establish the minimum benefits package suitable for coverage in California.
• Contains significant cost-containment measures, including allowing the state to pursue bulk purchasing of pharmaceuticals and requiring transparency from hospitals.

In addition to cost-containment measures, the bill is financed through a combination of fees and taxes to be approved by voters, including:

• A $2 per pack increase in the tobacco tax.
• An employer fee assessed on a sliding scale. Employers with payrolls up to $100,000 would be expected to contribute at least 2% of payroll. Employers with payrolls from $100,000 to $250,000 would be expected to contribute at least 4% of payroll. Employers with payrolls above $250,000 would be expected to contribute at least 6.5% of payroll. In addition, employers would be expected to either offer insurance to part-time employees or contribute to the public purchasing pool for those employees.
• A hospital fee assessed at 4% of revenue.

“Time and time again, Californians have made it clear there is no greater issue that we can be working on today than improving on our fragile health care system,” Núñez said.

Audio of the Speaker’s opening remarks:

Speaker Núñez says the Democratic health care reform proposal will make California the national leader in health care reform.

Speaker Núñez says the Democratic health care reform legislation is not perfect but it’s a major improvement over the current system.

Speaker Núñez says the Democratic health care reform package includes an individual mandate but also includes affordability provisions.

Speaker Núñez says the Democratic health care reform proposal includes a tobacco tax of two dollars per pack.

Speaker Núñez explains the financing package voters will see on next November’s ballot.

Speaker Núñez says the differences between the Governor’s proposal and the Democratic health care reform legislation will not stop health care reform.