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Sacramento Democrats are raising taxes on private health insurance

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California Gov. Gavin Newsom has never seen a pocket he didn’t want to pick.

And on his way out the door, Democrats want to cover his profligate spending habits via your health insurance.

The vehicle is the Managed Care Organization tax (the MCO tax), a levy the state collects from health insurance plans.

New federal rules forced California to restructure it, and Sacramento’s solution, Senate Bill 125, lands the new burden squarely on people who buy private insurance.

As the state’s legislative analyst and others have noted, California had been charging Medi-Cal plans at a higher rate than private plans.

This amounted to a quasi-shakedown of the federal government.

SB 125 lowers the tax on Medi-Cal plans while raising it on private plans to the same level.

The result, if Newsom signs it, will shift more of the cost burden onto people who buy private insurance, while likely bringing in less revenue overall.

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The plan costs working families more and the state less. That is not tax reform. That is a bailout for a governor who has spent nearly a decade........

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