Health care reform back in the spotlight for California voters

SACRAMENTO, Calif. — When Californians go to the polls later this year, they will confront contentious health care choices.

Voters will weigh whether to overturn a state law that bans flavored tobacco products and will likely consider increasing the cap on medical malpractice awards. They may also vote on proposals that effectively legalize psychedelic mushrooms and regulate dialysis clinics.

Two pandemic-related measures also could qualify for the Nov. 8 general election: One would tax California’s wealthiest residents to create an institute to detect disease outbreaks and bolster the state’s public health system. The other would limit government officials’ ability to shutter schools and businesses during a public health emergency.

Although the election is about 10 months away, money is already pouring in from deep-pocketed interests eager to defeat measures that would eat into their profits.

Big tobacco has invested $21 million to overturn the ban on flavored products, and the health care industry has dropped $43 million to beat back the proposal to raise California’s cap on medical malpractice awards, according to campaign finance records filed with the California secretary of state’s office from Dec. 27, 2019, to Dec. 30, 2021.

“The stakes couldn’t be higher at a monetary and at a human level,” said Thad Kousser, who chairs the political science department at the University of California-San Diego. “Health care is a massive industry, as well as something that affects people in their most vulnerable moments.”

Kousser, an expert in California’s initiative process, noted that big spending does not guarantee a win. He pointed to failed attempts by Mercury Insurance and its chairman in 2010 and 2012 to raise auto insurance premiums — ballot measures that voters rejected despite massive industry spending.

The flavored tobacco measure is the only one that has officially qualified for the general election ballot, but supporters of the medical malpractice proposal have collected enough signatures for it to qualify, according to the secretary of state’s office.

The health care industry isn’t waiting for the malpractice initiative to become official. The $43 million the California Medical Association, the California Hospital Association and their allies have given to defeat it represents nearly three-quarters of the amount they spent to successfully oppose a 2014 medical malpractice ballot measure, according to a KHN analysis of campaign finance records.

That’s also nearly four times what supporters of the 2014 initiative, which also would have increased the cap, raised for their entire campaign. This time, the author of the medical malpractice ballot measure said he plans to invest up to $40 million of his own money to counter the health care industry’s opposition.

“I don’t back down,” trial attorney Nick Rowley told KHN. “We have a grassroots effort. They have no idea what is coming.”

The measure would raise California’s $250,000 cap on medical malpractice awards to about $1.2 million, adjusted annually for inflation. It also would change state law to allow a judge or jury to exceed the cap when a patient has been left permanently impaired, disfigured or disabled, or a loved one has died — categories that critics say would essentially include all patients and subject providers to a flood of lawsuits.

California lawmakers set the $250,000 cap in 1975 after doctors and hospitals complained that malpractice lawsuits were driving up costs and could push providers out of state.

More than four decades later, physicians and other providers are making a similar argument.

“The biggest fear that we have, if this is successful, is having to stretch resources that are already thin,” said Leslie Abasta-Cummings, CEO of Livingston Community Health and board chair for the Central Valley Health Network, which represents more than 100 health clinics. Patients, she warned, could “lose access in certain areas to health care.”

Rowley, a Montana resident who practices law nationwide, dismissed that argument, pointing to a growing number of states that no longer have a cap or have raised it. Doctors, he said, continue to practice in those states while California victims of malpractice have limited legal options.

Health care providers are also gearing up to defend a 2020 state law that bans the sale of flavored tobacco products popular with young people who smoke or vape.

When lawmakers approved the ban, they argued that the tobacco industry should not be allowed to market menthol, candy and fruit-flavored electronic cigarettes to children. Tobacco companies counter that the law removes legal products from the market that adults should be allowed to use — and that it discriminates against Black smokers who favor menthol cigarettes.

The California Coalition for Fairness — funded largely by tobacco giants R.J. Reynolds Tobacco Co. and Philip Morris USA and its affiliate U.S. Smokeless Tobacco Co. — is trying to overturn the law with a referendum. The coalition flexed its political muscle early, raising $21 million in the three months after Gov. Gavin Newsom signed the legislation in August 2020.

Health care groups have banded together to defeat the ballot measure but are far behind, with just $2.7 million in contributions — nearly 60% of them coming from former New York Mayor Michael Bloomberg.

Several other health proposals could appear on the ballot:

• Backers of a measure to decriminalize the possession and cultivation of psychedelic mushrooms have until March 15 to collect the needed signatures. Psilocybin-containing mushrooms, known as “magic mushrooms,” are a Schedule I controlled substance under federal law. A growing number of states and cities — including Oakland, Santa Cruz and Arcata in California — have decriminalized the mushrooms.
• A health care worker union is back with a third try to regulate dialysis clinics via the ballot process, calling for greater transparency of clinic ownership and tougher staffing requirements. If the past is any indication, the dialysis industry will once again spend heavily to defeat the initiative should the SEIU-United Healthcare Workers West union get the signatures it needs by April 27. The industry defeated two earlier dialysis ballot measures, flooding the airwaves with ads and spending $111 million in 2018 and $105 million in 2020.
• Frustrated by school and business closures during the pandemic, backers of one proposed initiative want to limit business restrictions during public health and other emergencies to 30 days, unless they are extended every 30 days by state and local lawmakers. The proposal would require big-box retailers to be treated as small businesses, noting that many small businesses were forced to shutter early in the pandemic while larger retailers remained open. The proposal also describes schools as an essential service that should remain open “to the maximum extent possible.” Supporters have until May 3 to collect signatures.
• A proposal to strengthen California’s public health system, which proponents say has crumbled during the covid-19 pandemic, would increase the personal income tax rate by an additional three-quarters of a percentage point on income over $5 million. The tax would last 10 years and generate up to $1.5 billion a year. Half the proceeds would fund an institute to detect and prevent new disease outbreaks, 25% would pay for safety upgrades at schools, and 25% would help rebuild local public health workforces and infrastructure. Backers have until May 23 to gather signatures.

California Healthline’s Angela Hart contributed to this report.

This story was produced by KHN, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.