Health Bill to Cover ‘Uninsurables’ Gains in Assembly Panel Vote

SACRAMENTO — Far-reaching legislation aimed at providing health insurance for AIDS sufferers, diabetics, cancer patients and other so-called “uninsurables” has been brought back to life after languishing in committee for months because of lack of a political consensus.

The legislation still has its opponents, primarily because lawmakers have not been able to agree on a way to finance the subsidies that will be needed to pay the premiums.

But one of two bills seeking to provide insurance for the uninsurables made an important advance Tuesday when it was approved, 13 to 4, by the Assembly Finance and Insurance Committee after several amendments.

The bill, drafted by Sen. Alan Robbins (D-Van Nuys), would set up a nonprofit state agency to provide catastrophic and major medical benefits health insurance to anyone who currently is unable to obtain it from private insurers. Anyone who could afford the premiums to buy the $1,000 deductible policies would qualify.

But because the bill would create an insurance pool of the so-called “worst risks,” or those who face the highest potential medical costs, everyone close to the legislation agrees that the insurance plan will need subsidies from the state. At this point, the legislation contains no money to provide the subsidies.

One of the amendments to the Robbins bill deleted revenue from Proposition 99, the tobacco tax initiative, as a possible source of money for the insurance plan.

Robbins, who anticipated using some of the tobacco tax proceeds--should the measure pass in November--said after the committee action that he still sees Proposition 99 as a potential source of subsidies and plans to campaign for it. Robbins also said he expects that if the insurance program goes into effect, the state will save millions in its Medi-Cal program and that money can be shifted into the insurance pool.

Assemblyman Patrick Johnston (D-Stockton), chairman of the committee, said he likes the Robbins bill even without a funding source because “it establishes as a public policy that we ought to have a high-risk pool for people who can’t find health insurance anywhere else. A future Legislature will have to appropriate money to subsidize the plan.”

The action comes a day after release of a study by the UCLA School of Public Health showing that the number of Californians without any kind of health insurance jumped 50% between 1979 and 1986, rising to 5.1 million.

Robbins estimates that 1 million of those 5 million Californians are persons with preexisting health problems that make it impossible for them to obtain private health insurance.

Supporting the Robbins bill are numerous health groups, among them organizations representing persons who find health insurance out of their reach, such as the Diabetes Assn. of Sacramento, the Los Angeles County Epilepsy Society, the National Multiple Sclerosis Society, and the United Cerebral Palsy Assn. of California. The Assn. of California Life Insurance Companies, the California Medical Assn. and a number of labor organizations also support the bill.

Showdown Ahead

The Robbins bill, which has been approved by the Senate, next faces a showdown vote in the Assembly Ways and Means Committee.

Members of the Ways and Means Committee last year approved a rival measure that would have subsidized a proposed catastrophic health insurance plan with an increase in the disability insurance tax. That measure, which generated strong opposition from labor groups because of the tax, has been bottled up in a Senate committee.

Assemblyman Phillip Isenberg (D-Sacramento), author of the rival bill, said he is not optimistic about his bill because of the labor opposition.

“(Robbins) has the program bill that promises the most, but he’s got no way to pay for it. I have a more modest program, but I have a way to pay for it. That’s the trouble. People don’t like my bill because it’s real money.”

Tax Proposal

Isenberg’s bill would raise about $800 million annually by taking limits off the disability insurance tax. Currently, California workers are taxed only on the first $29,500 of their earnings.

“Insurance companies aren’t going to touch this program unless there is a guarantee that their losses will be covered,” Isenberg said.

Deukmejian vetoed an earlier version of the Robbins bill because it also contained a proposal to increase the disability insurance tax.