Health costs hinder overhaul

The defeat of the $14.9 billion bill backed by Gov. Arnold Schwarzenegger and Assembly Speaker Fabian Núñez is a setback for state initiatives, but doesn't necessarily damp prospects for national reform. That is because California's enormous uninsured population and shaky fiscal health made it a poor prospect for change. But the demise of California's proposed healthcare restructuring underscores a difficulty states face in achieving universal insurance coverage: their inability to slow the upward trajectory of healthcare costs, analysts said.