Perata: Getting the Facts on Healthcare Reform

When major legislation passes with great fanfare, it’s easy to get caught up in the moment, play to the cameras, and quickly go along. It happened when the state enacted energy deregulation – only to create a crisis from which we’ve yet to fully recover.

That’s not something I intend to repeat, especially on an issue as crucial to our state as the health of its citizens. The Senate will debate and act on healthcare reform when we have the facts to be sure we’re getting it right.

Below is the text of the letter Don Perata sent to the Legislative Analyst's Office on Monday:

December 17, 2007

Elizabeth Hill
Legislative Analyst
925 L Street, Suite 1000
Sacramento, CA 95814

Dear Ms. Hill:

I am writing to ask for your assistance in providing an independent fiscal analysis of the health reform proposal now under consideration by the Legislature. Your report would be especially helpful when the Legislature reconvenes in January and Senate policy and fiscal committees begin conducting public hearings.

Although I recognize that a thorough fiscal analysis of the package cannot be completed until all of the financing elements are resolved, I believe work to analyze the programmatic components can and should begin now. Much of the plan is now contained in AB 1 1x, which would be contingent on passage of an initiative measure to be placed on the November 2008 ballot. The level of the tobacco tax remains the most significant unresolved revenue issue; however, the proposed increase is likely to be between $1.50 and $2.00 per pack.

I have attached the most recent analysis from Dr. Jon Gruber. This reflects the latest version of the proposal, including the cost of the purchasing pool, tax credit and effects, employer and employee contributions, and level of federal match.

Specifically, I would like you to address the following questions:

• When the program is fully implemented, what are the expected revenues and costs?

• How would these factors change after the first five years?

• What are the risks, cost pressures and implications for the general fund?

In addition, the Governor is due to deliver his proposed budget on Jan. 10. I would also like to know how the Governor’s spending plan affects the health reform legislation’s underlying finances.

If you have any questions regarding this request, feel free to contact Diane Cummins or David Panush, my policy advisors on the budget and health care. Thank you for your attention to this matter.

Sincerely,
DON PERATA