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Home Advocating for Consumers in Sacramento Reference Materials Text of Governor's Health Care Reform Proposal Comments

Gov. Arnold Schwarznegger's Remarks on proposing Health Care Reform

Hello everybody.  Thank you for being here. I believe that in Sacramento
this year, we are going to make history. Using a comprehensive approach
built on shared responsibility where everyone does their part we will fix
California's broken health care system and create a model that the rest of
the nation can follow. I know everyone has been eager to hear exactly what
we are proposing.

But before I announce our plans let me thank my health care reform team that
has been working around the clock on this for months. Kim Belshe, my
brilliant Health and Human Services Secretary, has been fantastic. So has
Daniel Zingale, one of my senior advisers. Dan Dunmoyer, my cabinet
secretary, has been invaluable. Great health care experts like Herb Schultz,
John Ramey, Richard Figueroa and Ruth Lu have been absolutely fantastic.

For much of the past year, we have been meeting with health care experts,
insurers, doctors, business and labor leaders, consumer groups and
hard-working Californians all desperate to fix this problem.

California has the best medical care and the best medical technology in the
entire world, but how we deliver and pay for that care is badly broken. We
have more than 6.5 million people without insurance nearly one-fifth of our
population so the rest of us pay their bills.

When they need care, the uninsured go to emergency rooms which have become
so over-crowded you can wait seven hours to see a doctor. And more than 60
emergency rooms have closed over the past decade because they didn't want to
keep treating people without insurance.

So we pay higher deductibles, higher costs for treatment, higher premiums
and higher co-pays. Prices for health care and insurance are rising twice as
fast as inflation, twice as fast as wages. That is a terrible drain on
everyone and it is a drain on our economy.

My solution is that everyone in California must have insurance. If you can't
afford it, the state will help you buy it, but you must be insured.

 Most employers offer coverage to their workers but if they employ at least
10 workers and don't provide insurance they will be required to pay 4
percent of payroll into a state fund so people without insurance can buy
basic coverage.

And let me be clear about something. There is no debate about whether to
provide medical care for people who are in California illegally. I know this
is controversial but federal law requires us to treat anyone who shows up at
an emergency room in need of care. So the decision for my team was do we
treat them in emergency rooms at the highest cost available or we do it
right and do it efficiently?

Another serious part of the problem is that right now we have insurance
companies that pick and choose who they cover. They turn away people who are
sick or past a certain age. My plan would put an end to that and not allow
insurers to deny coverage to people because of age or health status.

We will also require insurers to put at least 85 percent of their premium
revenues into patient care rather than profit and administration. But the
insurers will benefit because mandatory insurance means private carriers
will have four to five million new customers.

Under our current system, doctors and hospitals don't get paid enough to
treat people on Medi-Cal. We pay less than half the cost of care and my plan
stops that by increasing Medi-Cal rates $4 billion.

And hospitals and doctors will help us insure everyone by paying a "coverage
dividend" into the state fund that sells insurance to people who don't have
it four percent of revenues for hospitals and 2 percent for doctors. But
hospitals and doctors will benefit because their patients will now have
insurance.

My proposal calls for other reforms that will:

* reward healthy lifestyles

* cut regulatory barriers

* expand health information technology

* reduce medical errors

* and use our enormous purchasing power through Medi-Cal to enhance care,
quality and efficiency.

This is not a government-run program. I am proposing a comprehensive program
where government sets guidelines, where it establishes the rules. I look
forward to a vigorous and open debate. Everything will be on the table and I
want to hear from everyone. But I know we can do this. Everyone in the
Legislature is focused on solving this problem. Several proposals have
already been put forward. If we have the will and, I believe that we do we
can heal our broken system. We can make health care more affordable,
accessible and equitable for everyone.

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