California Governor Signs Children’s Insurance Bill

 

On Tuesday, September 22, 2009, California Governor Arnold Schwarzenegger signed the bill that prevented almost 700,000 low-income children in the Golden State from losing their health insurance.

The bipartisan bill restored funding to California’s Healthy Families program, a state-funded insurance plan for children in low-income families. The program’s funding had been cut in July as part of a massive fight to absorb a $24 billion deficit in the California budget. As a result, enrollment was frozen, and coverage for 670,000 children would have ended in October.

The bill signed on Tuesday provides a temporary solution, using funds from a First 5 California grant, higher premiums, and a fee on insurers to fund the necessary coverage. Under the law, health insurance companies will be paying a new tax of 2.35%, which income will be used to leverage roughly $100,000 in federal matching funds, which, in turn, will be used to repay the insurance companies.

Despite the fact that Governor Schwarzenegger had threatened the California legislature with a refusal to sign any bills until the issues of water, prisons, and renewable energy had been handled, he signed the bill in a ceremony at the state Capitol building, stating that leaving so many children uninsured, especially with the threat of an H1N1 flu epidemic, would be disastrous.