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Health-plan tax would hit California hard

San Francisco Chronicle, January 18, 2010

California could be disproportionately hit by a proposed annual tax in the national health overhaul legislation that critics say penalizes restrictive managed-care policies, which are far more popular in the state than in the rest of the country. A provision in the Senate health bill calls for paying for expanded health benefits in part by taxing health insurers, while exempting plans offered by large employers who pay their employees' claims. Kaiser Permanente and other health plans, small businesses, and California medical groups that rely on managed care payments are lobbying congressional leaders to keep the provision out of a final version of the bill, or at least apply the tax to all health plans, the San Francisco Chronicle reports.