CA Businesses Support Mandatory Health Care Bill

October 3, 2003 ( - The majority of California's state businesses support the recently passed bill requiring employers either provide health care for workers or pay a fee into a state fund to cover the uninsured.

More than six out of 10 (64%) of the state’s businesses recently polled by The Institute for Labor & Employment (ILE) at the University of California support the provision of the bill. Further, 59% of business that do not currently offer health insurance to workers also voiced their support for the measure.

This may be due to the fact that the overwhelming number (90%) of firms that currently do not offer health benefits are in markets where their competitors do not provide such benefits either. This suggests that businesses most impacted by the proposed reform would be unlikely to face idiosyncratic increases in costs that would worsen their competitive position.

The bill would require all companies with 200 or more workers to offer insurance for employees and their families starting in 2005 or pay fees to support a statewide insurance program. Firms with between 20 and 199 employees would have to give workers, but not their families, insurance by 2006 or pay similar fees to the state. In most cases, companies would pay at least 80% of the monthly insurance premium, leaving workers to pay no more than 20% of the tab.

Employees would qualify for coverage under the law if they worked at least 100 hours per month and had been with their current job at least three months. Workers who qualify would either get insurance on the job or through a state-run insurance pool. Four out of five of California’s approximately 6 million uninsured residents are workers and their families, studies show.

After being approved by the state legislature, the bill now moves onto the governor’s desk for his signature before becoming law.

When all is said and done, the study forecasts the median cost for participating businesses under the bill will represent only a 0.2% increase in overall operating costs; roughly $1,343 per newly insured worker. Thus, estimating that the bill will effect 1 million workers, the report forecasts the total price tag to be at $1.3 billion to enact the measure.

A copy of the study is available at: .