The Senate Budget harms healthcare

Health Access California opposes the Senate Budget Proposal considered the morning of August 29th, 2008, which would significantly harm health care in California, now and in the future.

Here’s the health impacts of the Senate Budget Proposal:

* The proposal includes all the cuts agreed to by the Budget Conference Committee (AB1781). In health care, those cuts include more onerous reporting requirement for children’s coverage through Medi-Cal, and an increase in Healthy Families premiums, among other reductions. This is expected to deny coverage to over 250,000 children over the next three years.

* The Senate Budget Proposal includes even deeper cuts in health care and other vital services. In health care, this includes a delay in restoring the Medi-Cal provider rates until March of 2009. The Legislature and Governor made 10% cuts to provider rates earlier this year, but proposed to restore them. This would make additional hundreds of millions of dollars of cuts to California’s health care providers by delaying that restoration. (This is assuming, of course, that the State is successful in its appeal of a court decision that struck down the cut.)

* The budget relies on a *temporary* 1-cent sales tax, a revenue stream that will expire in three years. Since California’s health care needs are expected to grow, not shrink, in three years, this would likely force a budget crisis and additional cuts at that time in three years. At best, this only delays the inevitable decision to either revenues or make cuts permanently.

* Most concerning in the long view, the proposal makes permanent, problematic changes to the state’s budget process in exchange for a temporary tax increase that would leave the state facing significant budget shortfalls in 2011-12, if not sooner, and beyond.

— The so-called “reserve” that functions as a spending cap that would drain money away from health care, education, and other vital services, locking in inadequate funding levels–California is 51st in the nation in per-patient Medicaid spending—and as health costs rise, forcing additional cuts in the future, especially to health and human services.

— In particular, the proposal would give the Governor unprecedented power to make unilateral cuts mid-way through the budget year. This and future governors would be given sweeping power to cut payments to families and children, payments to providers of state-funded services, higher education, and other programs based on estimates prepared by the governor’s appointees.

Health Access California promotes quality, affordable health care for all Californians.

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