In Schwarzenegger’s presentation on the budget Wednesday, when being grilled by the media on the specifics of his lottery proposal and other elements of his budget, he made a point to invoke his “don’t forget health reform” pitch: he indicated it was a shame it didn’t pass earlier in the year, and how he is still committed to doing health reform in his term.
“As you know, we have made severe cuts in health care. And when it comes to health care, what is even more painful is that we didn’t get health care reform done, because that would have given Medi-Cal an additional $4 billion dollars. So we are going to go and continue staying on that subject of health care reform, and continue working with the stakeholders together to get this done.”
Some, especially those in the Senate, used the budget crisis as an excuse to stall AB x1 1, the negotiated plan between the Governor and the Speaker, saying it wasn’t the right time for such an ambitious effort in the middle of a budget crisis. Others, especially in the Administration, stated that the budget deficit only reinforced the urgency of health reform.
My take: Passing health reform would not have prevented the tough choices presented by the budget crisis, but it would have provided additional–and better–options for a solution.
What would have happened if the plan passed? AB x1 1 and its companion ballot measure would have raised $15 billion in new revenues for health care coverage expansions and provider rate increases.
There’s no doubt that the cuts announced today and back in January take us in the absolute opposite direction–a cut of $2 billion plus in both state and federal funds. Instead of raising $15 billion with AB x1 1, we are facing gruesome cuts:
* Instead of expanding Medi-Cal coverage and broadening the eligibility rules, the Governor has proposed restricting eligibility.
* Instead of raising provider rates, the Legislature and the Governor has already cut those rates, so millions now have less access to doctors and hospitals.
* Instead of streamlining and simplifying these programs, the Governor proposes making them more bureaucratic and cumbersome.
* Instead of bringing in more federal matching funds, the Governor proposes making cuts and thus losing those matching funds, leaving even more federal money in DC.
* Instead of dramatically reducing the number of uninsured Californians and the resulting “hidden tax” on the health system as a whole, the Governor’s proposal would markedly increase the rate of uninsurance, for children and families.
If we had passed health care reform and still had to deal with $2 billion in cuts, then that would have meant that we only had $13 billion for health care expansions and improvements–and so then we would have the choice of raising additional revenues to make the new expansions and commitments whole again, or restructure the proposal to work with the $13 billion (rather than $15 billion) raised. Any of those choices, while tough, would have been preferable to what we have now.
If adopted, the Governor’s proposed cuts take us further from the goal: it digs a bigger hole, that will need to be filled before embarking on additional expansions.
Medi-Cal and Healthy Families are the foundation for health reform, on which additional expansions are built atop–but that only works if the budget that funds them are strong and sustainably funded.
We will also be pursuing legislative and policy reform that we believe lays a foundation for reform in 2009-10, and we are pleased that the Governor have indicated an interest in such efforts. But the budget is also a key foundation that needs a resolution this summer.
Even with these ugly budget cuts hanging in the air, I have to hope that the Legislature will once again decide to reject these health cuts as too severe, as they have in the past. I have to hope that constituents in rural and “red” areas care about their schools, emergency rooms, seniors and children as much as anyone else.
And I have to hope that the logic of health reform will prevail upon this Governor: that the best arguments against these cuts, and for revenues to prevent these cuts, were all made by this Governor last year as he stumped for health reform:
* that California is visionary enough to get everybody covered, and not leave people to be uninsured;
* that Californians are willing to contribute to support and expand health coverage;
* that we need to invest in our health care system, for its own sake and to bring in new federal matching dollars that are left in DC; and
* that investments in health care have broader benefits, including positive health, societal, and economic implications.
Finally, it’s worth remembering that part of the Massachusetts health reform was a deal to restore of several key cuts to that’s state’s Medicaid program (for example, to benefits) made in previous years. Our work this year will be to prevent such cuts, so they won’t have to be restored in the first place when we pursue comprehensive health reform in the near future.