The Squeeze Is On: Amid Recall Threat, Newsom Faces Single-Payer Dilemma

BY BEN CHRISTOPHER, CalMatters

Along with a pandemic, a recession, closed schools, ongoing budget negotiations and a likely recall campaign coming later this year, Gov. Gavin Newsom now has one more political problem to deal with: How to keep — or break — one of his biggest campaign promises. 

When running for governor in 2018, Newsom vowed to replace an “inefficient and wasteful” patchwork of private insurance companies and programs with a single, state-funded health plan for everyone. “I don’t know how to do it, because it’s never been done. But I believe it can be done. And if any state can prove it, we can,” he told CalMatters then. “I’m willing to tackle this.” Progressive activists and the powerful California Nurses Association rallied to his candidacy.

Three years later, some of those supporters say it’s time for the governor to make good on that promise. 

“Governor Newsom campaigned for single payer…These are things we are trying to hold him to,” said Eric Vance, an organizer with Healthy California Now, an umbrella organization of unions, health care activists and alums of Vermont Sen. Bernie Sanders’ presidential campaign, pushing for single payer. 

Donald Trump has exited the White House. The pandemic has created an unprecedented public health crisis. And although President Joe Biden opposes a federal single-payer program, Xavier Becerra, the Californian he nominated to be his health secretary, is a single-payer proponent.

Said Vence: “Now more than ever is the time.”

The political pressure ratcheted up further on Friday when Democratic Assemblymember Ash Kalra from San Jose unveiled legislation to push the state toward adopting a single-payer program. 

The bill lays out a comprehensive health care plan for all Californians. But it leaves many of the most challenging details — how much hospitals and doctors should be paid for services, how to reroute federal health care dollars into a single program — to a governing board established by the legislation. And like the failed California single-payer proposal from 2017, the bill does not specify a funding source, instead simply stating “the intent of the Legislature” to figure that out sometime in the future. Even if passed into law, a program wouldn’t be established until that money becomes available.

These fresh demands arrive at a politically delicate moment for the governor. With a recall campaign increasingly seen as inevitable, he can ill-afford to tick off progressives. But earnestly campaigning to scrap the state’s entire health insurance system and replacing it with a government-run program that analysts say could cost more than the state’s entire budget remains a dicey political proposition.

Newsom already has plenty of those. Earlier this week, San Francisco state Sen. Scott Wiener introduced a state bill to ban hydraulic fracturing, forcing the governor to choose between honoring another campaign promise or providing more fodder to recall opponents who blame the governor for the state’s job losses. 

Ditto, the school opening debate. Critics on the right condemn the governor for not doing enough to get kids back in school — Republican former San Diego mayor Kevin Faulconer has made this a focus of his bid to replace Newsom. Meanwhile, the California Teachers Association, one of Newsom’s largest backers in 2018, rolled out a statewide ad campaign warning lawmakers to “put safety first.” 

The single-payer conflict amid a recall campaign presents an especially “vexing political problem” for the governor, said Thad Kousser, a University of California San Diego political science professor. There are two competing theories on the best way forward, he said. 

Theory number 1: “The best way to defend yourself against a recall in a state the Democrats just won by 5 million votes is to lock down the left — and some movement toward single payer, some strong commitment, could do that.”

Theory number 2: “This is not the right time to take on a very controversial and very costly policy that may not even find a welcome audience in DC.”

Sal Rosselli, president of the National Union of Healthcare Workers and vice chair of Healthy California Now said there’s no real dilemma because the concept of a state-funded health insurance program is already popular. 

“A super, super majority of Californians already support ‘Medicare for All,’” he said. “Am I concerned about (Newsom) alienating people? I’m not. I’m confident that he’s going to lead.”

That’s exactly what Newsom said he would do when he was a candidate.

Polling does regularly show that a wide swath of Californians support single payer — at least as a concept and in certain circumstances. 

In 2017, the Public Policy Institute of California found that 56% of likely voters surveyed supported the creation of “guaranteed health insurance coverage” from a “single state government health plan.” But support fell to 43% if enacing such a plan meant higher taxes. Single-payer proponents argue that the higher taxes needed to finance a single-payer program could be at least partially offset through lower or eliminated premium and copay payments. 

And last April the UC Berkeley Institute of Governmental Studies poll found that 55% of registered California voters surveyed either somewhat or strongly agreed that a single-payer program “would improve the nation’s ability to respond to disasters and pandemics such as COVID-19.” 

Garry South, a Democratic political consultant who has worked with the California Nurses Association in the past, said those polling results might overstate the public’s support. 

In surveys, if you ask Californians “‘Do you think that health care is a right and not a privilege and that every American or every Californian should have health insurance?” you’re going to get an overwhelmingly strong response, South said. But those ideals often come with another set of convictions, he said: “In achieving that, don’t ask me to give up anything. Don’t ask me to give up my private health insurance. Don’t ask me to pay more in taxes.”

South said Newsom’s priority should be on expanding health insurance coverage — both public and private. “It’s not about some other terminology you want to stick on it. It’s about universal coverage,” he said.

But for the single-payer-or-bust contingent of the Democratic Party, the debate is about more than terminology. They say the only way to provide cost-effective health insurance to everyone is through a universal, publicly funded program. According to the Kaiser Family Foundation, 7.8% of Californians went without health insurance in 2019, the last year for which there was reliable data. That’s down from 17.2% in 2013, a decline that California won through its eager embrace of the Affordable Care Act. 

Supporters of single payer say the current public health crisis only reiterates the need for sweeping change. “If there’s an argument for single payer it’s certainly the pandemic…the current system doesn’t work,” said Michael Lighty, a policy consultant working for the National Union of Healthcare. Critics say just the opposite: that the jittery vaccine rollout and the cascading series of failures at the state’s Employment Development Department should make Californians especially wary of entrusting their health insurance to a new state bureaucracy. “People in general have a pretty jaundiced view of government’s ability to deliver,” said South.

As governor, Newsom took symbolic, if minor, steps. In one of his first acts, he sent a letter to the Trump administration and congressional leaders asking for the federal waivers that would be required to bring all the health care funding that flows to the state through Medicare, Medicaid, the Veterans Administration and other programs under a single program. It was a nonstarter with the Trump administration.

In late 2019, Newsom also launched a statewide commission tasked with deciding what a single-payer system in California would look like and how it would work. Initially given a due date of this month, the commission — which some single-payer advocates saw as a stalling tactic to begin with — has been sidelined by the pandemic and hasn’t convened since August. 

Kalra’s bill marks the first time Newsom will have to contend with single-payer legislation as governor. Of course if recent history is any guide, it may not reach his desk. 

In 2017, a single-payer effort sponsored by the nurses’ union sailed through the state Senate but stalled in the Assembly. That proposal lacked a funding source, making it politically and procedurally easier to pass, but lacking vital details. Democratic Speaker Anthony Rendon shelved the bill, shielding his caucus from a contentious debate over how to pay for it. Healdsburg Democrat Jim Wood, chair of the Assembly Health Committee, has written an opinion piece that accuses the nurses of “boiling this very significant and complex issue into a chant.”

Four years later, Rendon is still the speaker and Wood still chairs the health committee. 

David Townsend, a political consultant who often works for business-friendly Democrats, said he’d be “surprised” if a single-payer proposal gets out of the Legislature. “Even if Newsom wanted to, there’s just no way.”

Single-payer supporters are divided over the legislation too. Though the California nurses, who sponsored Kalra’s legislation, are part of Healthy California Now, the coalition itself is neutral on the bill. Instead, the organization’s goal is to ask Newsom to begin negotiations with the federal government over how to reroute federal health care spending toward a future single-payer program.  

“The governor of California needs to lead this whole process,” said Rosselli of the National Union of Healthcare Workers.