California's resounding 'no.' - rejection of Proposition 186

Business Economics, April, 1995 by Rita Ricardo-Campbell

Californians have no desire to pay higher taxes, and there is not enough excess to be wrung from administrative costs, from Medicaid reform and the capping of Medicare benefits to pay for extensive health benefits for the millions of the uninsured. Rising health care costs are beginning to be controlled as the rate of increase has been declining. At least one major company, Hewlett-Packard, has announced 15 percent lower health insurance premiums for their employees in 1995. The Wall Street Journal of December 1, 1994, reported lower prices, by as much as 20 percent in selected California markets, for some laboratory tests and x-rays and also reported on January 17, 1995, sizable discounts for organ transplants.(4) The more competitive markets have begun to work.

California was and remains open to health care reform. Among all the fifty states, California is ranked as having the greatest health care problems as measured by an index that includes the percent of uninsured, the level of health outcomes, health care expenditures relative to the gross state product and "the number of undocumented persons and other vulnerable populations."(5)

IMPLICATIONS FOR NATIONAL HEALTH CARE

What does California's decisive negative vote against government-run medical care mean for the country as a whole? In 1995 and in 1996 the public will increasingly continue to fear rationing. Federal government policymakers give no evidence of having thought through the consequences of their proposals to contain costs by restructuring medicine by increasing the number of cheaper primary care physician visits and decreasing the more expensive specialist visits. Requiring consumers to pay more for self-referrals to specialists than if they first have a primary care visit and physician referral will not automatically restrain total costs, but this is likely to decrease the quality of care. A discussion is needed about whether we can evolve a really high-tech generalist physician, or does the high level of U.S. complex medical knowledge make this impossible? It is this superb "high-tech" medicine that attracts many residents of foreign countries that have national health systems to buy from our so-called nonsystem.

California already has a high proportion of its population, close to the leading percentage, enrolled in various forms of prepaid groups and option plans that already limit subscribers in accessing top-notch specialists unless they pay out-of-pocket. Further limitation by the national or state government seems not to be wanted. The intensity of opposition is likely to be higher against the federal government because it is further removed than a state government.

The public in 1994 did not trust incumbent government and thus the public did not want more government intrusion into the private area of medical decisionmaking. If major health reform was not passable in California where there would be easy availability of medical services from other states, a major reform law affecting one-seventh of the economy and creating massive redistribution of income is not passable nationwide. The public in the United States is well aware that if there were a national health care law, no easy escape valve would be available to permit Americans to avoid its potential, dire personal consequences. United States acts as such an escape valve for Canadian residents.