How plan for California gov't health care might be funded

Markets Associated Press

A pending state Senate bill would provide government-funded universal health care for California's 39 million residents. The bill faces a Friday deadline for passage out of the Senate if it is to be considered by the state Assembly. Here's how University of Massachusetts-Amherst researchers, in a study commissioned by the influential California Nurses Association, suggest the state pay for it:

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— The total annual cost is estimated at about $406 billion a year.

— Existing state and federal health care funding could provide $225 billion.

— Researchers say better efficiency and lower negotiated pharmaceutical drug costs could save $75 billion.

— The remaining $106 billion could be paid for with a sales tax increase and a new tax on business revenue.

— The researchers suggest a 2.3 percent sales tax and a 2.3 percent gross receipts tax, which would apply to all corporate revenue.

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— The plan would eliminate out-of-pocket health care costs, like copays and deductibles, for consumers.

— Poor residents would get a tax credit to offset the higher sales tax.

— Critics say the plan is unrealistic, including its expectation that President Donald Trump's administration would waive rules about federal Medicare and Medicaid dollars.