With millions of uninsured, California has the most to win _ or lose _ with health care reform

Stakes high for California in health care reform

SAN FRANCISCO — Among states, California arguably has the most to gain from an overhaul of its health care system: it has the greatest number of uninsured residents in the country and the largest public insurance program for the poor, which struggles to serve 6.5 million people while reimbursing doctors at one of the nation’s lowest rates.

Stuck between the increasingly uncertain future of national reform, a looming $20 billion state budget deficit, and a health care system that is limping along and likely to face even greater demand in the coming years, Californians are frustrated. Doctors, patients, politicians and researchers all agree change is desperately needed, even if they disagree passionately on what that change should look like.

More than 200 protesters gathered in front of Sen. Dianne Feinstein’s San Francisco office last week, waving signs that said “Health care now: We can’t afford to wait” and chanting “Health care for people, not for profit.”

Protester Stephen Schork, 26, a bartender in Orinda, Calif., has no health insurance and has not gone to a doctor in years. He does not qualify for Medi-Cal, as Medicaid is known in California, and can’t afford private insurance.

“We need the government to get involved, and give us more options,” he said.

If Californians with higher income were allowed into Medi-Cal, as proposed in the federal bills, people like Schork could potentially benefit. A strained public insurance system is better than nothing at all, he said.

“I worry about it all the time,” Schork said of living without insurance. Allowing more people into Medi-Cal would be “a fantastic way to do it.”

Tired of waiting for action on the national front, members of the California Senate approved last week a plan calling for a single-payer health care system. The bill was sent to the Assembly, although Gov. Arnold Schwarzenegger has already vowed to veto it, as he has two similar proposals.

Two years ago, it was Schwarzenegger, a Republican, who tried to negotiate a state health care reform plan with Democratic leaders. If it had passed, the $14.7 billion reform proposal would have been the largest health care overhaul undertaken by any state. Massachusetts approved a similar plan in 2006, but the state’s uninsured population is far smaller.

Schwarzenegger’s proposal was undone by a Democrat — former Senate President Pro Tem Don Perata — who asked for a financial review and found the plan would be too costly for the cash-strapped state.

Public opinion polls show Californians are also frustrated with their leaders’ handling of health care reform. More than half of the voters in this liberal state now disapprove of the job the president did pushing for reform; 69 percent disapprove of the way Congress handled the issue, according to Field Poll surveys released in January.

“It’s not that voters have necessarily lost their appetite for reform,” said Poll director Mark DiCamillo. “The negative ratings that we developed in our job assessment of Congress and the President all have to do with their revulsion over the process.”

The bills pending in Congress could have added up to 1.9 million patients to Medi-Cal, costing a worst-case total $3 billion to $4 billion per year.

It is this math that pushed not only the governor and others to call on legislators for more federal dollars to pay for Medi-Cal or turn down the bills pending in Congress altogether.

Michael LeNoir, a pediatrician and allergist based in central Oakland, came out of medical school 30 years ago with a mission of helping underserved communities. Half his practice consists of Medi-Cal patients — but he said he relies on the other half, the ones with private insurance, to keep his office afloat.

“Medi-Cal is already down to the bone,” he said. “I can’t imagine that putting more people into it would be sustainable.”

Over the past three years, Medi-Cal ranks increased from 6.6 million to 7.2 million patients, but the number of doctors, pharmacists and other providers accepting Medi-Cal did not grow, according to the state’s Department of Health.

Doctors can drop out of the system when they can no longer afford to participate, but hospitals are required to provide emergency care, said Jan Emerson, spokeswoman for the California Hospital Association.

“We are the provider of last resort. We absorb the losses,” she said, adding that in 2008, hospitals in the state had $11.3 billion dollars in uncompensated care — $4.2 billion of it attributed to Medi-Cal’s below-cost reimbursement rate.

Supporters of reform said the gains would ripple through the economy. The current system cripples small businesses, ties employees to their jobs, and denies many who want to pay for coverage access to insurance because of pre-existing conditions, said Ken Jacobs, chair of the University of California, Berkeley Labor Center.

“The benefit of (reform) goes well beyond the number of people who are uninsured today,” Jacobs said. “If you look at it from the perspective of the state economy, it is a positive.”

Still, Toby Douglas, the chief deputy director of health care programs at the California Department of Health Care Services, said the proposals pending in Congress just don’t make fiscal sense for the state.

“California can’t fund its program today, let alone support an increased mandate under health care reform,” said Douglas.

Medi-Cal has already been through painful cuts, eliminating dental care, eyeglasses, hearing aids, and other services.

“These reductions have an impact on our beneficiaries, but we’ve had to make those changes,” said Douglas. “It would be very hard for us to take on this additional fiscal impact.”