Rebecca Kimitch, Staff Writer
Posted: 12/23/2009 10:16:35 PM PST

Gov. Arnold Schwarzenegger has long championed national health care reform, but now that it is finally advancing, he is raising concerns about the $3 billion annual price tag he says it will cost California.

But reform supporters, including Sens. Dianne Feinstein and Barbara Boxer, say the benefits of reform for the state far outweigh the costs.

“I am convinced now in 2009 that hope and reason and determination and good policy will triumph over fear and obstruction and the status quo. Let’s look at the immediate and near-term changes for the better that people are going to have,” Boxer said on the Senate floor Monday.

And Feinstein said Tuesday she will work to improve the legislation’s cost to California before any final reform is signed into law, though she puts that cost closer to $1 billion.

Feinstein doesn’t have much time for negotiation.

If things go as expected Thursday morning, health care reform will have only one major hurdle before its gets to the president’s desk – conference committee with the House version. The Senate has scheduled a Christmas Eve vote on final passage of reform, and various procedural votes in recent days prove it has the votes to pass.

Just as the long-awaited reform is advancing, Schwarzenegger has hit the national airwaves multiple times in the past week casting doubts on it.

“In the last month it became very clear that the state will face an additional $3 billion of costs. That

concerns me, because right now we have a big budget problem,” the governor told the press Monday. “The federal mandates are very, very difficult on the state of California because they make you spend a certain amount of money, which makes it impossible to live within your means.”

The $3 billion figure is the amount state finance officials estimate it will cost annually to expand Medicaid as called for under federal health care reform legislation.

The Senate bill would expand Medicaid – the government’s health insurance for the poor known as MediCal in California – to people who make up to 133 percent of the federal poverty level, or $29,000 for a family of four and $14,400 for a single person.

Current coverage varies from state to state. In California, people are covered up to about 106 percent, though it varies based on whether an individual has children and other conditions.

Under the Senate bill, the federal government would cover the additional costs of Medicaid expansion for the first three years. After that, California would have to come up with about 20 percent of the additional cost.

“I am not at all satisfied with that,” Feinstein said in a written response to questions. “However, we have some time to work on this issue, and we also have a conference to work on this.”

But one state has already won a better deal.

In an effort to win the needed vote of Nebraska Sen. Ben Nelson, the legislation calls for the federal government to pick up the full cost of expanded Medicaid coverage in that state in perpetuity, not just for the first three years.

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