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California Democrats Want To Fund Universal Healthcare With Higher Taxes: 3 Things To Know

California Democrats Want To Fund Universal Healthcare With Higher Taxes: 3 Things To Know

California

Photo: Assemblyman Ash Kalra, D-San Jose, in Sacramento, Calif., Jan. 6, 2022. (AP Photo/Rich Pedroncelli)

Could universal healthcare be coming to California? Democrats in the state have proposed providing free health services to every resident, paid for by new taxes on the wealthy and on businesses.

Here are three things to know.

1. Assembly Bill 1400

The proposed bill is called Assembly Bill 1400 and it would create “CalCare,” a system governed by an independent board of directors that gives access to any doctor, regardless of the healthcare network, and a broad variety of medical services. It was introduced by Assemblyman Ash Kalra, a Democrat from San Jose.

The legislation would reduce costs to providers to bring them closer to the actual cost of care as well as lower prescription drug prices, Business Insider reported. The bill also allows for long-term care for seniors and people with disabilities and allows for medical care regardless of immigration status.

The plan would impose a new excise tax on businesses equal to 2.3 percent of any annual gross receipts above $2 million. A new payroll tax would also be created, equivalent to 1.25 percent of total annual wages and would be collected from businesses employing 50 or more people. An additional payroll tax would be required for employers with workers earning more than $49,900 annually, The Los Angeles Times reported.

There will be higher taxes on the state’s wealthier state residents. All but the lowest-earning Californians would have to fork over more in taxes. Residents who earn more than $149,509 a year would have increased taxes. Californians with an annual taxable income of more than $2.5 million would see a new 2.5 perent surcharge, The Los Angeles Times reported.


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Responses were mixed on Twitter.

“It’s ridiculous that the ‘richest country in the world’ doesn’t provide healthcare for its citizens. Every other industrialized nation takes care of its people,” tweeted GRTSeeker (@Grtseeker)

“Two bills for single-payer: #CALeg plan unveiled today puts policy in one bill, tax increase in another. Regardless, a big political fight could be brewing,” Los Angeles Times reporter John Myers tweeted.

2. Universal healthcare has been discussed for years

Offering a government-run fund that covers medical expenses for all residents has been widely discussed for years in California by politicians. Legislation has also been put forward before but “fizzled over recent decades” due to a lack of broad-based political support, The Los Angeles Times reported.

This latest effort by Kalra has support, such as from the California Nurses Association and major opposition.

3. Opposition

The bill has been criticized by a coalition of influential political players including the California Medical Association and the California Hospital Association.

The plan has also drawn opposition from Republicans, insurers, and some doctors in the state, according to a report from the Associated Press.

The California Taxpayers Association, which has opposed the legislation, claims the system would increase tax collections in the state by $163 billion per year, AP reported.

“California already has near-universal healthcare coverage,” Rob Lapsley, president of the California Business Roundtable, said in a statement. “AB 1400 would eliminate healthcare options and force everyone into an untested government-run program.”

There is also opposition from some residents.

“Wtf I already lose 1/3 of my check. New taxes will make me lose everything,” tweeted Michael Garcia (@norcalbayboy)

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Photo: Assemblyman Ash Kalra, D-San Jose, discusses his bill that would pay for the universal health care bill, during a news conference at the Capitol in Sacramento, Calif., Jan. 6, 2022. (AP Photo/Rich Pedroncelli)