California's great risk: health care reform

The future of health care reform could be on display in California. The state has worked to be an early adopter of the Affordable Care Act, signed into law by president Obama in March of 2010. And while it's earlier efforts, and mistakes at implementing health care reform could help it succeed, its challenges could also make it fail. In any case, California could be a prime test case for national health care reform.

LOS ANGELES, CA (Catholic Online) - In 2007, Governor Arnold Schwarzenegger attempted to implement a health care reform bill similar to what is now known to many as "Romenycare" in Massachusetts. The effort failed. In its wake, officials have worked to implement the Affordable Care Act. 

California officials have more experience than some. An earlier effort at a state healthcare exchange, a system where small businesses and individuals could shop for insurance, failed. Experts believe the earlier system failed because the market was too small and insurers could be selective about who they made deals with. Still, that failure has given state officials experience that may ensure the current effort at reform works. 

Officials are now looking at more successful health care reform plans in other states as well as other insurance exchanges to guide their new policies.

Already, California has increased the Medicaid eligibility threshold to 133 percent of the federal poverty line, while other states are waiting until they are required to do s o by law in 2014. However, as the state plunges into health care reform with determination, the risk of failure is substantial.  

California has the nation's largest population of uninsured people, around 7 million. That's more people than the entire state of Massachusetts. Californians also have lower incomes, so low that many people may be willing to pay the penalty and risk being uninsured than to purchase insurance--a purchase which could cost them more than paying the penalty. 

Meanwhile, California doctors are being reimbursed at rates lower than anywhere else in the country. And the state's budget crisis, which is prompting deep cuts in spending, could mean that there will be little money available for the state to subsidize health care exchanges. 

While California has great experience, it also has great challenges. In many ways, it is a model of the United States. Millions of Americans are uninsured, incomes vary widely, and many Americans may choose to opt out of buying their own insurance.

The wave of fiscal conservatism sweeping the legislature and the repeated calls for ever deeper cuts in federal spending may also undermine federal support for many health care reforms.  As the nation slowly works its way into the Affordable Health Care Act, many states will be watching California as it sets the pace towards success--or failure. 

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