The Change Mariner: Healthcare Cost Weigh On California

May 03, 2004

Healthcare Cost Weigh On California

From care delivered through the mammoth Medi-Cal program to grants that subsidize university research, the burden of health care is woven into nearly every page of California's $99 billion budget.
Last year, the state's medical bill topped $40 billion, paid by a combination of federal, state and local taxes. By most accounts, it is the fastest-growing segment of public spending and there is no end in sight.

Medical care for the needy -- including pharmaceuticals, preventive care and hospitalization -- accounts for the biggest part of the spending. But growing even faster are the billions spent on insurance premiums for state employees and retirees as well as for the hundreds of thousands of teachers employed by local school districts whose money also comes through the state.

Like the rest of America, the state's dependents are aging and demanding more care -- especially for the newest, most expensive drugs and procedures. The combination -- complicated by the state's ongoing budget problems -- has some experts warning of a fast-approaching breaking point.

"We are on the edge of a very significant jump off the cliff,'' said Stephen Levy, director for the Center of Continuing Study of the California Economy.

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