California Takes the Plunge

California's legislature has passed a single-payer health care system; the only outstanding question is whether or not Arnold will sign it.

It’s been largely under the media radar screen, but California may be on the verge of establishing a single-payer health care system. Late last month, The California Assembly passed legislation establishing a Canadian-style, government-run health care system. The legislation had earlier passed the California Senate, and while there are small differences that will have to be reconciled, but there is no doubt that the bill will be sent to Governor Schwarzenegger. The question now is whether Schwarzenegger will veto the bill. In the past he has said he would, but it’s an election year and he is under big pressure from unions and others to sign it. Schwarzenegger has caved in other issues recently, from prescription drug price controls for MediCal to vehicle emission controls to state budgeting. If he signs this bill it will be bad news for Californians and a terrible precedent for the nation.

I am of two minds on California's proposal. I mean its obviously a terrible idea, but...

The negative effects stemming from socialized medicine will occur much faster when implemented in a state as opposed to a nation. Its easier for doctors to move to Nevada or Arizona than it would be to simply leave the country. Its easier for companies to avoid price caps by simply selling inventory in New York instead of LA. Its also easier for businesses to relocate out of state to avoid the entire mess.

Its also possible that nearby states will start to develop consumer influenced pricing since there will be many people that will be paying for healthcare out of pocket to avoid the shortages that are bound to occur. Finally released from the mess that is employer supplied insurance a real market could actually emerge.

I think it is important for American's to experience first hand the downsides of such a policy, otherwise its inevitable that we would get a nationwide single-payer which will be much harder to get rid of.

On the other hand, I'm scared that other states will simply jump on the bandwagon without pausing to consider what it is really doing to California. If enough states take the plunge and find out that it is too expensive they will pressure the fed to pick up the tab in the form of a national plan.

I'm fully in favor of California going it alone, but god save the rest of us.

Update: Cato@Liberty is reporting that Arnold will likely veto the bill. Again, I'm not sure if this is good or bad news as the advent of government medicine is going to come eventually. The only question is whether or not its at the state or federal level.