The 2026 California governor’s race is heating up, and single-payer healthcare has quickly jumped from the political sidelines right into the spotlight. For many voters struggling with skyrocketing insurance premiums and out-of-pocket medical bills, the idea of a state-funded system feels like a much-needed fix for a broken setup. Candidates like Tom Steyer and Xavier Becerra have championed the policy, treating single-payer as a defining litmus test for progressive credentials in the race.
However, actually pulling off this transition is a massive financial puzzle. A May 2026 report from KFF Health News highlights the ultimate sticking point: a state-run healthcare system would cost an estimated $731.4 billion, and officials have not yet figured out how California will fund it. If you are wondering why your medical bills keep rising, this debate is well worth your attention. Transitioning to a single-payer model would completely rewrite the rules of how you access doctors and pay for treatment.
What is single-payer healthcare?
The main argument for single payer is straightforward. That would eliminate the “middleman” – private insurance companies. That would be a cheaper, fairer and more efficient healthcare system. Proponents say a single, government-run system for all provides universal coverage, with no more premiums or deductibles. Prescriptions would cost less.
This approach reduces wasteful spending and simplifies medical billing. The system could use collective buying power to reduce drug and hospital prices. All funding would be consolidated in one place. The aim is to abolish for-profit insurance and establish a single public insurance program that provides health care coverage for everyone.
In health policy circles, the terms “single-payer” and “universal coverage” are sometimes used interchangeably, but these are different things. Single payer pays for it. The result is universal coverage – everyone receives care, explains the American Public Health Association.
Single-payer systems can significantly reduce administrative expenses, according to a PMC publication. The multi-payer system in the United States currently wastes billions on advertising, claims processing and billing. All of this is centralized under a single-payer approach, which reduces waste.
However, there’s a significant issue: taxes would have to increase significantly. According to KFF, California would require more than $700 billion in healthcare tax income to replace what private firms currently charge, even if individuals did not pay premiums.
Still, single-payer could help solve major issues for Black communities. Even among those with money, Black Californians have poorer birth outcomes and greater rates of uninsurance, reports the Johns Hopkins Bloomberg School of Public Health. Reducing financial barriers and insurance complications may help bridge the care gap. Healthcare is unequal because of historical segregation. This concept seeks to rectify that and offer equitable access to all.
Misconceptions about single-payer healthcare
“People often think single-payer healthcare insurance is ‘free.’ It’s not. It’s a pre-paid system. You do not pay a private company each month. Instead, you pay through the healthcare insurance through your taxes”, explains Anne Kamwila, Healthcare Policy Analyst.
“Another wrong idea is that it’s the same as ‘socialized medicine.’ In places like the UK’s NHS, the government owns hospitals and hires doctors. In most single-payer plans (like “Medicare for All”), hospitals and doctors are still private. The government pays the bills.”
Larry Levitt from KFF says it well: “Californians do not care what you call it, as long as healthcare is affordable.” But confusion about these words often makes people more divided about politics.
The real risks
Moving to a single-payer system is not as easy as signing a law. There are big real-world problems that voters do not always think about:
Federal waivers: California would need federal approval to reallocate billions of dollars from Medicare and Medicaid. Neither the Trump administration nor a split Congress will approve this. It’s just not going to happen.
The “disruption” factor: Many people dislike their insurance companies, but millions of Americans like their work-based plans. Under single-payer, nobody keeps what they have now. Focus groups show people change their minds once they realize the shift.
Provider reimbursement: If the government sets prices too low, doctors and rural hospitals might struggle financially. People might have to wait longer for non-urgent surgery.
How do Americans currently pay for healthcare?
The US now uses a multi-payer system. It’s a mix of private and public money. About 54% of Americans get insurance through work, according to the Georgetown University Center on Health Insurance Reforms. Others use government programs. Medicare covers older people. Medicaid covers poor people. Veterans get the Veterans Health Administration. It’s complicated and messy.
This fractured setup is expensive to manage. Care quality is all over the place. When your job changes or your money situation changes, you might lose coverage. For millions of families, figuring out all these different plans and payers is a huge pain.
What is the largest single-payer healthcare system?
In the US, Medicare is the largest example of single-payer-style care we have now. Around the world, the National Health Service (NHS) in the United Kingdom is the largest single-payer system. It covers everyone in the country, according to KFF. But when people compare the US to other countries, they usually look to Canada, as a 2017 New York Times article reported.
“People take jobs because the employer gives health insurance. Otherwise, premiums are too expensive,” says Peter Hussey, director of RAND Health Care in Santa Monica, California. “Hospital charges vary wildly. Some states charge less than 200% of Medicare’s payment. Others charge more than 300%.”
Bottom line
Single-payer healthcare means one government agency pays for medical care for everyone. The idea is to reduce waste and ensure everyone gets care. It’s become a big political test in the 2026 California elections. But actually doing it faces huge problems. It costs hundreds of billions of dollars, and you need federal government approval. The system would replace insurance premiums with taxes, but people still argue over whether one state can even make this work on its own.
Frequently Asked Questions
Is Canada single-payer healthcare?
Yes. Canada runs a “National Health Insurance” system. The government pays for healthcare. Private doctors and hospitals still deliver the care. But each province manages its own finances.
Which country has the most expensive healthcare?
The United States has the most expensive healthcare in the world. We spend way more per person than any other rich country, although millions of Americans still lack insurance.
Citations
Mai-Duc C. In California Governor Race, Single-Payer Is a Litmus Test. There’s Still No Way To Pay for It. – KFF Health News. KFF Health News. Published May 8, 2026. Accessed May 13, 2026. https://kffhealthnews.org/health-care-costs/california-governor-race-single-payer-healthcare-becerra-cma-steyer/
American Public Health Association. Adopting a Single-Payer Health System. Apha.org. Published 2025. https://www.apha.org/policy-and-advocacy/public-health-policy-briefs/policy-database/2022/01/07/adopting-a-single-payer-health-system
Scheinker D, Richman BD, Milstein A, Schulman KA. Reducing administrative costs in US health care: Assessing single payer and its alternatives. Health Services Research. 2021;56(4). doi:https://doi.org/10.1111/1475-6773.13649
Winny A, Bervell R. Solving the Black Maternal Health Crisis. publichealth.jhu.edu. Published May 12, 2023. https://publichealth.jhu.edu/2023/solving-the-black-maternal-health-crisis
Burleson J. Vertical Integration in Health Care: Implications for Consumers, Employers, and Clinicians | Center on Health Insurance Reforms. Georgetown.edu. Published 2026. https://chir.georgetown.edu/vertical-integration-in-health-care-implications-for-consumers-employers-and-clinicians/
KFF. International Comparison of Health Systems | KFF. KFF. Published May 28, 2024. https://www.kff.org/global-health-policy/health-policy-101-international-comparison-of-health-systems/?entry=table-of-contents-introduction
Carroll A, Frakt A. The Best Health Care System in the World: Which One Would You Pick? The New York Times. https://www.nytimes.com/interactive/2017/09/18/upshot/best-health-care-system-country-bracket.html. Published September 18, 2017.