Repeal of Obamacare Could Hamper California's Single-Payer Plans


The Republican plan to repeal the Affordable Care Act (ACA) has greatly concerned citizens and political leaders in California, which has generally benefited from what some regard as one of President Barack Obama's greatest achievements. Although some elected officials and their supporters had hoped to circumvent the federal program by creating the state's own single-payer system, this plan could itself be thwarted if "Obamacare" is repealed.
California was one of the state's that participated in the Medicaid expansion, which was an important part of the ACA, and also created its own exchange program that allowed residents to purchase private insurance plans. Medicaid uses both federal and state funds for the purpose of providing health services for low-income residents. The increase in federal funding made possible the expansion of Medi-Cal, the state version of Medicaid, and the program currently covers one in three residents of the state, or approximately 14 million men, women and children.
The repeal of the ACA would greatly curtail Medi-Cal coverage or force the state to increase its share of the funding. An example of a state program that utilizes federal funds is a disabled adult care service, which could lose an estimated $400 million. This would force individual counties to bear a larger proportion of the costs.
In addition to the reduction in federal funding to Medi-Cal, the dissolution of "Obamacare" would affect Covered California, the private insurance exchange. According to California Sen. Dianne Feinstein, the Republican plan would result in higher costs and less coverage for those who purchase insurance from the exchange.
If California took the single-payer route, coverage would be provided through taxes collected by the state. This would require an increase of around 15 percent in the state payroll tax. In return for higher taxes, however, residents would no longer have to pay health insurance premiums, deductibles and related medical expenses. According to one study, a single-payer system would reduce medical costs in California by more than $35 billion.
Expressing concern about its effects on California's economy, state Republicans are opposed to a state-based single-payer health insurance program and generally support plans to reduce Medicaid. However, Republicans have virtually no power in California and may not be able to prevent Democrats from moving ahead with their plan. The primary threat to the Democratic plan may come from the repeal of the ACA, which would reduce the funding that could be be needed to sustain or at least initiate a state single-payer system. More about this issue is available at