The battle over health care reform—likely to be the biggest fight in Sacramento in 2007—started on the first day of the new legislative session.

On Dec. 5, state Senate and Assembly Democrats introduced several health care bills, including one by Central Coast Assemblyman John Laird that would guarantee free health care to every child in California.

A week later, Sen. President Pro Tem Don Perata, D-Oakland, announced a proposal to provide health insurance to all working Californians and their families by requiring employers and employees to pay the cost. Assembly Speaker Fabian Nuñez, D-Los Angeles, is expected to unveil another plan for universal coverage early next year.

the legislature is facing a “once-in-a-generation opportunity.”

By coming out swinging, both Democrat-controlled state houses have a lead over Gov. Arnold Schwarzenegger, who is expected to announce his own plan for health care reform during the State of the State address in early January.

The Republican governor hasn’t given any hints about what shape his planned health care policy will take—or who will pay for it. Earlier this year, he vetoed a bill to create a universal, single-payer system.

He’s already labeled 2007 as “the year of health care reform.” And while he hasn’t commented on the specifics in Perata’s proposal, or the individual bills, Schwarzenegger released a statement on Dec. 12, following Perata’s unveiling of his own health care plan.

“It is fantastic that the legislature is joining me in making health care reform a priority,” he said. “The stage is set for comprehensive health care reform—making health care affordable for more Californians, covering more of the uninsured and leading the way to a healthier California.”

During the 2003 recall election, Schwarzenegger pledged to see that all California children have medical insurance. But two years later, he vetoed a bill that would have accomplished this goal. And in 2006, he vetoed a universal health care plan authored by Sen. Shelia Kuehl, D-Santa Monica. Kuehl has said she will introduce a similar bill in early 2007.

Laird, who chairs the Assembly Budget Committee, co-authored Kuehl’s 2006 bill. He says Schwarzenegger vetoed the measure while promising to continue the talks with the new legislature.

“The governor vetoed single-payer with a commitment that he would work on something,” Laird says. “His major unfulfilled pledge from the recall election was ensuring health care for all kids. The governor comes to the table wanting to do something about health care.

“The fact that he’s gone this far is a very good sign, but at the same time, if he proposes something that’s totally window dressing and doesn’t really increase access, we’re going to want to hold his feet to the fire.”

In July, Schwarzenegger hosted a summit on health care affordability, and ever since then, say aides, he’s been holed up in closed-door meetings with experts and interest groups who want to influence his eventual policy plan. But they remain very tight lipped about what Schwarzenegger wants to do.

“The governor believes that affordability is key to increasing access to care, and decreasing the number of uninsured,” says Sabrina Demayo Lockhart, the governor’s deputy press secretary. “He’s also looking at preventative measures, and how to put these into policy. Another concept he’s focusing on is shared responsibility. No one party should bear the burden of health care, whether it be government, business or the individual.

“The governor wants to continue the dialogue, and he really sees the state of the state as an opportunity to kick off the policy dialogue.”

Meanwhile, Democrats in Sacramento aren’t wasting any time putting their policy ideas out to the public.

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At a news conference on Dec. 12, Perata said the legislature is facing a “once-in-a-generation opportunity to do something significant, important and long lasting.”

Perata says his plan would cover 4.2 million of the estimated 6.5 million Californians who are uninsured at some point during the year. It would not cover the unemployed—most of whom are already eligible for coverage under Medi-Cal—or for undocumented workers. It would cost between $5 billion and $7 billion a year, and would be paid for primarily through employer and employee contributions. Perata has requested assistance from the California Health Care Foundation to determine how much individual employers and their workers will have to pay.

The plan also relies on federal money to reduce employer and employee costs by expanding the Healthy Families program and Medi-Cal. It does not require any money from state general fund.

Assembly Democrats, however, are expected to take health care reform a step farther.

On Nov. 8, the day after the election, Nuñez held a morning news conference to lay out his agenda for the state.

“We’re going to sit down and we’re going to work out this health care crisis that California is facing,” he said. “It is not good enough to know that 6.5 million in our state do not have access to health care.

“It is not good enough in California to know that those who do have health care continually are paying an increase in their premium and it’s becoming more and more out of reach. Not only for working class California but for middle class Californians.”

Nuñez will announce his proposal next month. Meanwhile, bills by assemblymen Laird and Mervyn Dymally, D-Compton, and Sen. Darrell Steinberg, D-Sacramento, would provide care for the 800,000 children in the state without health insurance.

Two other bills, by Assemblymen Hector De La Torre, D-South Gate, and Jim Beall, D-San Jose, would require businesses to contribute to the coverage of their employees. Laird’s bill, which would provide health insurance for kids, would cost the state about $300 million.

He says at some point, all the health care measures will likely be condensed into a package of bills. “We wanted to make sure children are covered in the mix,” he says. “It will cost billions to insure all Californians that don’t have health care, but it will only cost $300 million to make sure all kids are insured.”

He says that at this point he doesn’t know where the money will come from. And the state is still facing a $5.5 billion deficit in the fiscal year that begins July 1.

“I think the billion-dollar question is how we close a nagging budget deficit and spend new money that we haven’t been spending before on health care,” Laird says. “That’s why we’re very interested in the governor’s State of the State speech.”