Attorney General No.


Secretary of State No.



HEALTH CARE COVERAGE, INSURANCE. TAXES. INITIATIVE CONSTITUTIONAL AMENDMENT AND STATUTE. Establishes Health Plan Commission to make basic health care insurance available to: residents with no available coverage; small business employees; self-employed; others. Establishes minimum coverage for Health Care Service Plans. Rate increases for health insurance must first be approved by Insurance Commissioner, for health care service plans by Corporations Commissioner. When not covered by health benefits plan, imposes payroll tax on employers, gross wages tax on employees, income tax on self-employed, others. Imposes additional excise tax on alcoholic beverages. Establishes Health Plan Fund. Exempts expenditures from state constitutional appropriations limit. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local governments: Costs of basic health insurance plan likely to exceed $4 billion annually, perhaps substantially. If costs exceed revenues, General Fund may bear substantial difference. Costs funded from new payroll and other taxes ($3.6 billion), cigarette and tobacco products surtax ($380 million), one-half of the new alcoholic beverage surtax ($200 million), General Fund ($550 million); one-half of the new alcoholic beverage surtax revenues ($200 million) would go to other new programs. Administrative costs of rate regulation estimated at about $8 million a year. Saving could result to other government health programs due to reduction in demand. The new alcoholic beverage surtax will result in higher state ($7 million) and local ($4 million) annual sales taxes. State insurance tax revenues could also increase.


Michael Weinstein, 1800 North Argyle Avenue, Suite 304, Los Angeles, California 90028 (213) 462-2297



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