California Gov. Gavin Newsom signed a bill into law last month that will gradually raise the minimum wage for healthcare workers to $25 an hour. The measure aims to put “a stop to the hemorrhaging of our care workforce by ensuring health care workers can do the work they love and pay their bills,” as the executive director of SEIU California put it.
But this mandated wage hike may lead to fewer healthcare workers being asked to do more — and higher costs throughout the healthcare system. Hospitals that are unable to shoulder the immediate financial burdens created by the new minimum wage will fold — and make care even harder to come by.
It’s hard to look at the Golden State’s healthcare sector and conclude that a higher minimum wage is warranted. California spends well over $400 billion per year on health care — more than any other state in the nation. Spending per capita is also higher than the U.S. average, as is spending growth.
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