Supreme Court health care decision: What it means for California

This morning's momentous Supreme Court decision upholding most of the Affordable Care Act, including the mandate that every American have health insurance, has major implications for California where an estimated 7 million people – about 20 percent of the population – are not covered.

"I can’t tell you what a relief this news is for the health care community and for L.A. clinics and health centers in particular," said Louise McCarthy, president and CEO of the Community Clinic Association of L.A. County. The association represents nearly one million patients served by 47 organizations at 135 sites across Los Angeles. She added that 59 percent of the patients at L.A's community clinics and health centers are uninsured.

According to a statement from Dr. Mitchell Katz, Director of Health Services for L.A. County, 80 percent of the 2.2 million people who are currently uninsured in L.A. County stand to gain access to insurance coverage. More than half of these individuals, he said, will be eligible to receive coverage through Medi-Cal in 2014, contingent upon the state’s likely participation in the Medicaid expansion component of the legislation.

But Joel Hay, a professor of health policy and economics at USC, says the battle over health care is far from over.

"People on the Republican side are going to be pretty disappointed with this," Hay said. "However, even Gov. Romney and all the Republicans made it absolutely clear their number one job is to overturn Obamacare. I think this gives them stronger motivation to get Romney elected in November. Had Obamacare been overturned, I think Obama’s base would have been fired up. So I think that will make it easier in key battleground states for Romney to pick up electoral college votes.

"I think the biggest problem with Obamacare is that it’s never been popular with the American people. I think there’s going to be – depending on who wins the House, Senate and White House in November – enormous roadblocks before implementing the Affordable Care Act."

Research conducted by UCLA and UC Berkeley indicates four million of the seven million uninsured Californians will get health care insurance under the Affordable Care Act. One million people are expected to be ineligible because of their immigration status. The researchers anticipate two million others won’t take steps to get insurance, but they would be subject to a penalty that will be levied on their federal tax returns.

California already has two so-called "bridge programs" that were created to provide health care to people with pre-existing conditions and to low income individuals until 2014, when those portions of the federal law are scheduled to kick in.

The larger of the two is the Low Income Health Program--an expansion of Medi-CAL that has been temporarily funded by the federal government with matching dollars from county governments. More than 400,000 Californians are currently enrolled in the plan.

The other affected "bridge program" is the Pre-Existing Condition Insurance Plan, which offers health coverage to medically-uninsurable Californians. There are nearly 12,000 people enrolled in the program.

Also in place is the California Health Care Exchange, a clearinghouse that will offer a smorgasbord of plans to Californians who don’t have insurance through their employers, and to small businesses. Low income customers could qualify for subsidies to help them purchase a health plan.

Peter Lee, executive director of the exchange, says by the end of 2013, people will be able to compare and purchase health insurance plans through the program.

"We look forward to making the purchase of insurance through California’s exchange as easy as buying a book on Amazon and shoes on Zappos," Lee said. "And we’re going to be moving full speed ahead to build this marketplace to make it easier for all Californians to get access to affordable insurance."

The state has spent $40 million in federal funds to build the framework for the exchange, but those funds run out in August. The state is planning to request more federal funds until the exchange is operational in January, 2014, when it is supposed to become self-sustaining.

But Mike Brewer, president of the Kansas City-based Lockton Benefit Group—the world’s largest global insurance broker—is dubious about the effectiveness of the exchange system.

The exchanges as they have been presented really don’t do much to curtail the cost of health care," said Brewer, "and you can’t reduce the cost of health insurance if you don’t reduce the cost of health care. There’s nothing in those exchanges that is necessarily going to do that."

In addition to the exchange and bridge programs, the California Legislature has already passed dozens of laws that enact various parts of the Affordable Care Act. Among them is a law that bans insurance companies from denying coverage to children with pre-existing conditions, and another that prevents insurers from setting lifetime caps on benefits. State law also requires insurance companies to let parents keep children on their health policies until the age of 26.

“I think it would be fair to say California has positioned our state to move forward with implementation of many of the elements of the Affordable Care Act,” said Bill Monning, a Democrat who chairs the Assembly Health Committee.