Senator Richard Pan on the issues animating health policy conversations in California

In a keynote presentation at the 2019 Southern California State of Reform Health Policy Conference, Senator Richard Pan outlined the work his committee may take up in the 2020 legislative session, as well as the lessons learned from a raucous 2019 session.

Pan chairs the Senate Committee on Health and the Budget and Fiscal Review Subcommittee on Health and Human Services. He is also a pediatrician by trade. It is this background and experience that makes Pan one of the foremost experts on health policy in California. 

As Pan noted during the presentation, Governor Newsom made health care a signature issue in his campaign. This proved to be a winning strategy. A PPIC poll conducted after the election found that voters were placing on premium on reaching universal coverage. 

 

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With health care taking center stage in the national conversation as well, Pan contextualized the current internal debates within the Democratic Party:

“In California we fully embraced the ACA under Governor Brown. There was a lot of back and forth about the ACA as to whether it was something the state could afford right after a recession. There was a $28 billion deficit.”

Offering context was a theme throughout the presentation. 

Pan underscored the importance of looking to Medi-Cal as a model for understanding what has worked in the past where policymakers should direct their attention in the future.  

“We should recognize that if we are going to control our health care future, especially since the state funds health care for a good portion of the population, one-third of Californians are funded through Medi-Cal for example, it’s something that is very important for the state.”

An integral part of “controlling our health care future,” according to Pan, involves defending the ACA when it comes under attack. Pan recounted the battles California lawmakers waged against efforts from the Trump Administration to undermine the health insurance market.

While the Trump Administrations made it their mission to cut subsidies, California expanded subsidies to people making 600% of the federal poverty level.

How did the market respond to these policies? Pan noted that health insurance premiums on average increased less than one percent, which is less than the GDP increase. 

Lawmakers also expanded access to coverage for undocumented immigrants up to the age of 26.

Heading into 2020, Pan will look at how to create incentives in the health care marketplace for people to innovate around taking care of people with chronic conditions a strategy Pan believes is the most fiscally responsible.  

“The healthiest fifty percent spend about three percent of the health care dollar, the sickest ten percent spent two-thirds and sickest five percent spend half. Even if we reduced health care spending in the healthiest fifty percent by a third, we’d only have a one percent savings. If we save five percent in the sickest ten percent, that’s a three percent savings.”   

Pan advocates for creating an incentive structure that builds a bridge between quality care and garnering the resources necessary to invest in the next cycle of improvement. 

“There should be some margin in taking care of people with complex needs so that infrastructure can be built and innovation can continue.” 

Pan expanded on these topics and much more during his presentation. If you couldn’t be there yourself, see the video above.