California Proposition 72, Healthcare Coverage Requirements (2004)

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California Proposition 72, also known as the Referendum Petition to Overturn Amendments to Health Care Coverage Requirements, was on the November 2, 2004 election ballot in California as a veto referendum, where it was defeated.

A "yes" vote for a veto referendum is a vote in favor of the legislative act that those who collected signatures to force onto the ballot are hoping to overturn. A "no" vote is a vote against the legislative act that provoked the veto referendum. In this case, a law that had recently been enacted by the California State Legislature was narrowly overturned.

The law that was overturned would have required employers in the state to provide health insurance policies for their employees, and to pay at least 80% of the cost of the policies. In the first year, the law would have applied to employers with more than 200 employees. As time went on, it would have eventually applied to employers with 20 or more employees.

Election results

Proposition 72
Defeatedd No5,889,93650.8%
Yes 5,709,500 49.2%

Text of measure


The ballot title was:

Health Care Coverage Requirements. Referendum.


The question on the ballot was:

"Should legislation requiring health care coverage for employees, as specified, working for large and medium employers be approved?"


Website banner of the "No on 72" campaign

The summary of the ballot measure prepared by the California Attorney General said:

A "Yes" vote approves, and a "No" vote rejects legislation that:

  • Provides for individual and dependent health care coverage for employees, as specified, working for large and medium employers;
  • Requires that employers pay at least 80% of coverage cost; maximum 20% employee contribution;
  • Requires employers to pay for health coverage or pay fee to medical insurance board that purchases primarily private health coverage;
  • Applies to employers with 200 or more employees beginning 1/1/06;
  • Applies to employers with 50 to 199 employees beginning 1/1/07. Applies to employers with 20 to 49 employees if tax credit enacted.

Fiscal impact

See also: Fiscal impact statement

The California Legislative Analyst's Office provided an estimate of net state and local government fiscal impact for Proposition 72. That estimate was:

  • Expenditures fully offset by fee revenues paid mainly by employers, which could range from tens of millions to hundreds of millions of dollars annually, to fund a new state program primarily to purchase private health insurance coverage.
  • Reduction in county health program costs potentially in the low hundreds of millions of dollars annually.
  • Uncertain net fiscal impact on state-supported health programs.
  • Increased costs potentially in the low hundreds of millions of dollars annually for state and local public agencies to provide additional health coverage for their employees.
  • Net reduction in state tax revenues potentially in the low hundreds of millions of dollars.
  • In summary, unknown net savings or costs to state and local government.

Campaign spending

A website logo of "Yes on 72" campaign

Campaign spending on Proposition 72 was fairly even, with the "Yes on 72" campaign spending $14.9 million and the "No on 72" campaign spending $16.1 million.[1]

Major donors to the "Yes on 72" campaign included:

Major donors to the "No on 72" campaign included:

  • California Restaurant Association: $2.5 million
  • Wal-Mart: $648,000
  • McDonald's: $471,000
  • Yum! Brands: $470,000
  • A variety of other restaurant chains and grocery stores.[3]

See also

External links