Angela Chang says the sticker shock never gets easier. Clients call her Southern California health insurance brokerage in disbelief, asking how much their insurance costs will jump again.
A hospital bill would hurt far worse, she tells them. But Chang, chief strategy officer at KCAL Insurance, also knows there’s only so much left in people’s pockets, especially with food and gas prices rising too.
In hard times, people want reassurance, Chang said. “I think that the general public would like to see our next governor … find a way for Californians to be able to remain covered affordably,” she said.
Nearly two in three Californians worry about unexpected medical bills, and six in 10 report they or a family member skipped care due to cost, according to a California Health Care Foundation survey. As Californians drown in medical debt and worry about losing coverage, the two candidates running for governor have given voters little indication of how they’d help.
Democrat Xavier Becerra says he wants everyone to be insured, but hasn’t spelled out how he’d pay for it. Republican Steve Hilton wants to overhaul the system, but can’t say how much it’ll cost or save consumers and the state.
Becerra has pitched himself as California’s next “healthcare governor” but did not make himself available for an interview for this story. He has also repeatedly refused appeals from the media and consumer interest groups to lay out substantive policy positions. As a result, much of what we know about his plan is drawn from his campaign’s own published materials rather than any direct response to questions. Becerra instead sticks to broad talking points — working toward universal coverage, prioritizing primary care, eliminating “administrative waste” — without offering much detail about how they’ll happen.
Hilton unveiled his own plan, the “Working Class Healthcare Guarantee,” only last week — proposing greater price transparency alongside plans that likely would flounder in the state’s Democratic-controlled Legislature, including replacing part of Medi-Cal, the insurance program for low-income people, with personal health spending accounts.
“They (voters) want a clear vision for how you’re going to help,” said Rachel Linn Gish, with the consumer advocacy group Health Access California, describing what she heard this summer at a series of healthcare affordability town halls in communities with particularly high health costs, including Santa Barbara, Salinas and Gilroy.
The stakes are urgent. California workers pay some of the highest premiums in the country, and many will see another spike during this fall’s open enrollment. Meanwhile millions of people who get free and low-cost care through Medi-Cal are expected to lose coverage as major federal rule changes go into effect on Jan. 1, regardless of who succeeds Gov. Gavin Newsom.
“Healthcare almost has to be like one of the first things that you [the governor] are tackling,” Gish said.
Becerra’s record
Becerra likes to tout his wins — as California’s attorney general he helped defend the Affordable Care Act against federal lawsuits. He also secured a major antitrust settlement against Sutter Health, which his office accused of using its market power to drive up prices.
But with greater experience comes greater expectations. Advocates and health researchers say they’d like to hear Becerra talk more specifically about how he’d tackle one of the key drivers of surging health costs: hospital prices. That’s one thing they’ll be watching for when Becerra and Hilton debate Wednesday on CNN.
“There’s plenty of blame to go around” for expensive healthcare, said Miranda Dietz, director of the Health Care Program at the UC Berkeley Labor Center. But hospital costs make up the largest share of premium spending – about 40 cents of every premium dollar.
“To fix the underlying cause of the affordability problem, I think is going to take really sustained effort and continued focus,” Dietz said.
Becerra’s policy agenda promises to “center affordability in every decision.” In it he says he’ll work closely with employers and other health purchasers to figure out ways to bring down premiums and out-of-pocket costs. He promotes ideas such as prioritizing screenings and primary care to keep people away from more expensive emergency care that results in larger bills. He also wants to expand on Newsom-era programs to bring down the cost of popular but expensive prescription drugs.
Perhaps his boldest promise is to continue covering every Californian affected by budget cuts and changes to Medicaid brought on by the federal spending plan that Congress passed last year. Becerra has not explained how he would pay to keep people covered. The price is steep: State officials project the federal health cuts could cost California up to $30 billion annually.
In August, when asked by reporters how he could promise continued coverage at such a high price tag, Becerra said: “Because I know how much we misspend in the health system, and because you and I know that we can’t leave people without healthcare, because if we do, not only will they get sicker, but it will cost you and me as taxpayers even more when they finally do access care.”
Some of that money may come from his promises to crack down on fraud and abuse in the Medi-Cal program through a special task force. But it’s unclear how soon that work would result in savings and how much — the same vagueness advocates are criticizing elsewhere in his agenda.
Becerra’s campaign has raised over $33 million, including major contributions from the healthcare industry. A health insurer (Blue Shield of California), a clinic system (AltaMed), a drug manufacturer (Genentech), several physician associations, and individual hospital executives have each donated the maximum $78,400 to Becerra’s campaign, according to CalMatters analysis of campaign finance data. Four branches of a group that lobbies for nursing homes have donated $313,000 combined.
Political strategists say the industry’s backing of Becerra is expected. The latest Berkeley IGS Poll shows the Democrat receiving 58% of the support from likely voters and Hilton receiving 33%.
Hilton’s campaign has raised more than $21 million, but campaign finance records show no significant organized contributions from the healthcare industry.
Hilton’s ‘healthcare guarantee’
Hilton crafted his plan, he says, in response to what he hears from voters. “I call it the Working Class Healthcare Guarantee because those are the people who are really, really screwed by what’s going on right now,” he told CalMatters.
Among his ideas, Hilton wants hospitals, physician offices, and pharmacies to show patients prices before providing nonemergency care. Some of that information is already gathered today, but Hilton says he will put together one website where patients and employers can make comparisons.
For California’s lowest-income earners, Hilton is proposing replacing part of their Medi-Cal coverage with health spending accounts of $8,000 to $10,000 a year. He’d keep people’s regular coverage in place for emergency care.
That is a substantial proposal attached to a very large population: roughly a third of Californians — more than 13 million people — are enrolled in Medi-Cal. Asked how much this would cost or save the state, Hilton couldn’t say. He framed the goal instead as giving people more control in choosing their doctors and reducing bureaucracy in the program.
Some states, like Arkansas, have experimented with health spending accounts. Arkansas officials found the program administratively burdensome and discontinued it.
Hilton also wants to reduce the number of people who rely on Medi-Cal, in part by making the individual marketplace, or Covered California, more affordable. He’d do that by establishing what’s known as a “reinsurance” program — insurance for insurers — that would help pay for the most expensive claims and keep those costs from driving up premiums for everybody else. It’s an idea Vice President J.D. Vance has also previously promoted.
States such as Alaska have reported some success in keeping premium increases down. But researchers have also found that premium savings weren’t always significant enough to make a difference for consumers.
One of the few ideas where Becerra and Hilton overlap is in their support for making and negotiating lower cost medications. Through its CalRx program – a signature Newsom program – California has started to distribute $55 insulin. It also distributes albuterol inhalers and naloxone.
Hilton says expanding on that program is a good idea. “I think we should do more of it.”
Whether any of this reaches voters
Political strategists say how much detail either candidate provides may matter less than party affiliation come November. Becerra’s lead over Hilton, 25 points in the most recent Berkeley IGS survey, has widened.
“Someone like Hilton could have some amazing policy positions, but he still has a lot of problems just because of the atmospherics of being a Republican in a Democratic state,” said Andrew Acosta, a Democratic political strategist.
As the frontrunner, Becerra may feel less pressure to provide more details about his policy agenda, Acosta said. Instead, he can point to Washington. “The beauty of the world we live in for Democrats is they can just point to Donald Trump and say, ‘Look at all the chaos he’s caused.’ It is a little bit of a get-out-of-jail-free card for Becerra.”
That dynamic is exactly what worries advocates like Gish, who say vagueness shouldn’t be cost-free for either candidate given how many Californians are struggling right now. Both campaigns’ unanswered questions will need real answers well before either man is sworn in.
“Let’s be clear and honest as Californians about what we want and what we value,” Gish said. “We need to make policy decisions that actually help people now.”
Supported by the California Health Care Foundation (CHCF), which works to ensure that people have access to the care they need, when they need it, at a price they can afford. Visit www.chcf.org to learn more.