News Release

Schwarzenegger on Health Care: People or Profits?


In his speech at the National Press Club yesterday emphasizing his health care proposals and “bipartisanship,” California Governor Arnold Schwarzenegger said: “Whether you’re Republican or Democrat, you don’t have to give up your principles at all. But isn’t the ultimate principle to serve the people? To do the things that are good for the people?” When asked about the role of big insurance and pharmaceutical companies, Schwarzenegger replied: “You must let everyone make their profits.”

The following health care specialists can assess the rhetoric and the substance of Schwarzenegger’s — and others’ — health care proposals:

Himmelstein is associate professor of medicine at Harvard Medical School; his work was recently cited by Schwarzenegger. Himmelstein said today: “Governor Schwarzenegger’s proposal would make Californians pay tens of billions to insurance companies for defective coverage. And his plan would add to the more than $40 billion wasted annually on insurance bureaucracy and paperwork in California. …

“Only a single-payer system can reap the savings on bureaucracy needed to assure comprehensive coverage for all.

“Two weeks ago the governor cited my work on medical bankruptcy, saying: ‘To quote a Harvard medical professor who did the best study on the subject, “Unless you’re Bill Gates, you’re just one serious illness away from bankruptcy.”‘ What he forgot to mention was that most people bankrupted by illness had exactly the kind of faulty coverage he wants to force Californians to buy. Three-quarters of medical debtors in our study had private insurance. The governor should get his facts right on medical bankruptcy. And he should get his facts right on single payer reform.” Himmelstein is co-founder of Physicians for a National Health Program.
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Dugan is research director of the Foundation for Taxpayer and Consumer Rights, which puts out the blog. She said today: “During his news conference at the National Press Club in Washington Monday, Schwarzenegger fielded lots of softballs from the smitten D.C. press corps. He also dodged one hardball from the moderator, asking whether as part of his health reform he’d regulate health insurance rates in the same way that auto insurance rates are successfully regulated in California.

“His response: Well, maybe, ‘if there’s a big problem’ later. He said he believed that requiring everyone to buy insurance on the private market would reduce the cost of health insurance premiums, currently averaging about $11,500 a year for a family of four.

“Then, the tipoff: ‘You must let everyone make their profits,’ he declared.

“Come again? It’s insurance companies’ bloated overhead and record profits that are the biggest driver of health care cost increases. Of course, part of that bloat comes from the $3.5 million the health industry has contributed to Arnold’s political campaigns.”
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Senior health policy fellow with the group Physicians for a National Health Program, McCanne writes a daily health policy update. He said today: “Governor Schwarzenegger, in his remarks before the National Press Club, touts his ‘post-partisan’ era of compromise in California. Yet, in health care reform, he is unwilling to compromise with his position that each individual be responsible for purchasing private health care coverage, even though the insurers have not been able to create a product that is both affordable and that provides enough coverage to prevent financial hardship for moderate-income individuals with significant health care needs.

“And for low-income individuals, he expects the federal government to increase funding for Medicaid and SCHIP (children’s insurance) at a time that the Bush administration is attempting to reduce income-eligibility levels and eliminate parents from coverage. He is emphatic about wanting health care coverage for everyone, yet he is obstructing reform by his uncompromising support of the private insurance industry that cannot deliver the effective, affordable product that we need, and by his dependence on federal funding that is not forthcoming. He could have reform simply by compromising in his opposition to single-payer insurance coverage, but he rejects that simply because of his own anti-government ideology. A spirit of post-partisanship requires compromise from everyone, including the governor. A compromise in ideology is a very small price to pay for achieving reform that would work for everyone — except the private insurance companies.”
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For more information, contact at the Institute for Public Accuracy:
Sam Husseini, (202) 347-0020; or David Zupan, (541) 484-9167