The SVO Voices Opposition to AB 3087 (Kalra)

The Silicon Valley Organization

On behalf of The Silicon Valley Organization (The SVO), we are writing to formally oppose AB 3087 which would create a new, independent state agency called the “California Health Care Cost, Quality, and Equity Commission”. We believe that this new regulatory bureaucracy would impose price controls on health care providers, which would both reduce health care affordability and reduce access to quality health care. By way of background, we are the Silicon Valley’s premier business advocacy organization representing 1,400+ companies that employ nearly 300,000 workers and we represent our membership as the region’s largest Chamber of Commerce.

Price controls ignore the underlying reason for the cost of health services and products. Most economists believe price controls keep prices artificially low and supply does not keep up with the demand. In the case of health care, the lack of supply means fewer health care providers. Without an adequate supply of health care providers, consumers may pay less but not have access to the care they need. AB 3087 will result in massive cuts to hospital services, a substantial loss of jobs, and a large number of hospital closures by putting health care finances in the hands of a centralized, politicized government bureaucracy. The bill does nothing to address the underlying market instability that complicates health coverage accessibility and affordability for Californians.

The SVO urges you and Members of the Assembly Health Committee to vote against AB 3087, so that we can focus on real solutions to provide quality health care under the Affordable Care Act.