Health-plan tax would hit California hard

The San Francisco Chronicle reports:

California could be disproportionately hit by a proposed annual tax in the national health overhaul legislation that critics say penalizes restrictive managed-care policies, which are far more popular in the Golden State than in the rest of the country.

An arcane provision in the Senate health bill calls for paying for expanded health benefits in part by taxing health insurers, like Kaiser Permanente, which covers about 6.6 million Californians, while exempting plans offered by large employers who pay their employees' claims.

Kaiser and other health plans, small businesses and California medical groups that rely on managed care payments are lobbying congressional leaders to keep the provision out of a final version of the bill - or at least apply the tax to all health plans.

"It's a real killer for California. Why should California pay more for health care reform than, say, Idaho or New York? It's not fair," said Don Crane, chief executive of the California Association of Physician Groups, which represents medical groups reimbursed by managed-care policies.

Great moments in Blue America.