A bill transforming California's healthcare system into a single-payer model would cost $400 billion, a sum that widely surpasses the state's $125 billion budget.
According to a legislative analysis, the state could seek various waivers to help pay for the program through Obamacare provisions and Medicaid, but to fully fund the system lawmakers would need to add a 15 percent payroll tax. The cost would largely be offset by current state, federal and private spending on healthcare in California, but total costs would still increase by roughly $50 billion to $100 billion a year.
The bill, the Healthy California Act, would eliminate health insurance companies and would cover people who are in the country illegally. It would operate in a similar way as the federal Medicare program, and would include no out-of-pocket costs for residents.
Two-thirds of California's Assembly and Senate must approve the tax increases, and even if the bill is signed into law by Gov. Jerry Brown, a Democrat, the waivers would need the approval of the Trump administration. Medicare and Medicaid would be expected to pay for about half the program.
Other attempts at single-payer at the state level have failed because of concerns about costs. Colorado voters rejected a recent proposal and Vermont didn't implement a single-payer system that was approved because lawmakers were unable to find a funding mechanism for it. Countries that have single-payer healthcare plans also mandate cost controls on drugs and medical services, but it's unclear how much of these proposals could be passed at the state level.