This article has been corrected.

The long-running saga of health reform in California has taken a new turn, with two developments that are reshaping the debate about how best to cover millions of uninsured and underinsured people in the state.

Last week, the Executive Council of the California Labor Federation, the AFL-CIO’s largest state affiliate with over 2.1 million members, voted unanimously to back HR 676, the national single-payer bill now before Congress. “The California Labor Federation believes HR 676 is shaping up as the national leader in quality health care reform,” spokesperson Anastasia Ordonez told the World. The federation and its affiliates will support actions across the country in support of the measure, she said.

HR 676, introduced into Congress by Rep. John Conyers (D-Mich.), now has 87 additional co-sponsors in the House of Representatives. It has been endorsed by 355 union organizations in 48 states, including 32 state AFL-CIOs and 94 Central Labor Councils and Area Labor Federations. The measure would cover everyone in the U.S. for all necessary medical care, with no deductible or co-pays, and would save billions annually by eliminating high overhead and profits of the private health industry and HMOs.

Meanwhile, on Jan. 28, the state Senate Health Committee voted down a controversial private insurance-based reform bill crafted by Republican Governor Arnold Schwarzenegger and the Democratic leaders of the Assembly and Senate. The bill, known as “ABx1 1” passed the Assembly late last year. It was first heard by the Senate Health Committee in a protracted Jan. 23 session. On Jan. 28, committee members – Democrats and Republicans alike – voted it down, 7 to 1, with three abstentions. Those who voted no worried about the nonpartisan Legislative Analyst’s report that funding might become inadequate after several years. Some also expressed concerns over the impact on poorer Californians of the “individual mandate” requiring nearly everyone to have insurance.

The labor movement, health care advocates and professionals, the business community and even insurers were split over ABx1 1’s merits. Supporters said the bill would cover most uninsured Californians, with public coverage or subsidies for low and moderate income people. Funding was to come from premiums, employer contributions, taxes on hospitals and cigarettes, and government funds already allocated to health care. Employers could either provide coverage or pay into a state pool.

Opponents, however, pointed out that ABx1 1 was not universal, would leave insurance companies in charge, did not guarantee quality of care, affordability or cost control, and did not require enough contributions from employers. The Senate Health Committee could hear the bill again at its next regular meeting, and its supporters could amend it and start over. But Assembly Speaker Nunez did not ask for a new hearing, and no time was left to put a funding measure before voters in November.

Meanwhile, medical students from around California held a noontime rally at the state capitol in Sacramento Jan. 28 in support of SB 840, a state single payer bill. SB 840 passed the legislature in 2006 before being vetoed by the governor. Sen. Kuehl withdrew it before it could be vetoed again last year.

“The California Labor Federation has always supported SB 840,” Ordonez told the World. “We’ve been active on the other measures that have been before the legislature.’

Ordonez noted that the Labor Federation publicly supported AB 8 and took a ‘support if amended’ position on ABx1 1. She said the Labor Federation expects that SB 840 will be held until 2009, when there will be a reduced chance of a veto, with a new governor.

mbechtel @pww.org

California Labor Federation Communications Director Anastasia Ordonez was misquoted in a previous version of this article. We have corrected the misquote in the last paragraph. We regret the error.

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