Tuesday, July 1, 20031


Another new fiscal year, another year without a budget in place…

Yesterday, the Assembly Republican Caucus has released a new version of their budget plan. This was in response to a challenge by Assembly Democrats on Friday, which put a version of their previous plan on the floor for a vote, which did not get any votes. The Assembly Republicans disavowed that version, saying it did not reflect changes from May Revise and economic factors, and thus worked over the weekend to release this new document. The plan may come up for a vote later this week. Assembly Minority Leader Dave Cox’s statement is at:

The major thrust of the proposal is once again to cut, borrow, and make many budget adjustments short of raising revenues. The plan rejects the proposals to increase the sales, tobacco, and upper-income taxes, and also includes a range of other new restrictions, including a balanced budget amendment, the limiting of future deficit financing, local government mandate reform, a spending cap, “fee reform,” “inmate health care reform,” and local government protection. The plan lists additional cuts in many areas, with significant new cuts in health.

SIGNIFICANT HEALTH CUTS: The proposal would make it harder for families to be eligible for coverage, to enroll to get coverage, to stay on coverage, and to actually get medically necessary services and care. Cuts of note would:

* HEALTHY FAMILIES: Rescind Healthy Families coverage for over 50,000 children by dropping the eligibility from 250% to 200% of the federal poverty level ($56M).

* AGED AND DISABLED: Impose costs onto low-income seniors and people with disabilities ($50M), by reducing the eligibility for free Medi-Cal coverage from 133% of the federal poverty level to the $708/month individual SSI/SSP level. About 55,000 “aged and disabled” would bear the costs or drop off coverage as a result.

* QSRs: Institute quarterly status reports ($43M) on adults with Medi-Cal coverage, burdening them with additional paperwork requirements for the express purpose of having over 100,000 people fall off health insurance. The legislature earlier in the year approved reporting requirements every six months.

* CHILD COVERAGE: Rescind continuous eligibility for children ($76M; $175M in 04-05). This would endanger continuity of care for the 3 million children in Medi-Cal, and the loss of coverage for up to 471,500 children.

* BENEFITS: Eliminate various medically necessary Medi-Cal benefits ($40M). While this would not include dental or durable medical equipment, this proposal would eliminate 11 benefits for the roughly 3 million adults on Medi-Cal, including medical supplies, psychiatric, chiropractic, acupuncture, and podiatric services, occupational therapy, optician and optical lab services, optometry, hearing aids, speech and audiology services, and physical therapy.

* STATE-ONLY: Eliminate all “state-only” health programs ($290M), that don’t get the federal matching funds that Medi-Cal services do. Among other cuts, this would:

* CHDP: Eliminate the Child Health and Disability Program ($50M), which provides immunizations and other preventative care to around one million California children.

* EAPC: Eliminate the Expanded Access to Primary Care Program ($23.5M), the Rural Health Services Development Program ($8M), the Indian Health Program ($6M), and other crucial funding sources for community clinics on which many areas depend.

* FAMILY PACT: Eliminate the Family Planning, Access, Care, and Treatment program ($63M), which actually does get up to a 9-to-1 federal match.

* MANAGED CARE: Force newly-applying Medi-Cal seniors & people with disabilities into managed care ($70M), which may end up costing more money yet restricting care for these populations.

* COUNTY ADMIN: Cut county administration for Medi-Cal by 20% ($112M). This would make it harder for families to enroll and get the health coverage they need, especially since county administration was cut severely last year as well.

The plan would also:

* Cut off funding for trauma centers on which we all rely ($15M)

* Institute co-payments for Medi-Cal services ($31M)

* Eliminate accelerated enrollment and the Healthy Families “bridge” ($6M)

* Eliminate “2nd year transitional” Medi-Cal for 2,000 adults entering workforce ($2M)

* Exclude over-the-counter drugs from Medi-Cal coverage ($8M)

* Enact California Dental Association proposals (instead of GB) ($73M)

* Impose an annual $1,000 limit on dental benefits for those on Medi-Cal ($6M)

* Reinstate Transitional Inpatient Care ($19M)

* Expand limits for Regional Center services ($97M)

* Impose a moratorium on new adult day health centers ($21M)

* Eliminate the pre-enrollment portion of the CHDP Gateway ($23M)

* Enact Medical Support Enforcement proposal (ACS) ($110M)

* Enact AIDS drug co-pay proposal ($6M)

* Eliminate Rural Health Care Equity Program ($11M)

* Reduce adolescent family life program ($12M)

* Establish new Regional Center Purchase of Service standards ($50M)

* Eliminate integrated services for homeless ($55M)

SPENDING CAP: In addition to this of cuts, the proposal would put in place a “spending cap” to “allow modest spending growth after 2003-04 to mirror increases in population and inflation.” It is unclear how this would differ from the current spending cap that California already has, which is based on population and inflation. Health care advocates should be especially worried about new spending caps, which could handcuff the state from meeting basic health needs into the future. As consumers face health care premiums go up 15% and more, the notion of a cap at 4% clearly would force health care cuts in eligibility, benefits, and services. Health care advocates should oppose anything that restricts the ability to meet needs created by economic recession, rising health care costs, bioterrorism and other public health emergencies, and not only a growing but an aging population that will require additional health care.

Anthony E. Wright

Executive Director

Health Access

1127 11th St., #234, Sacramento, CA 95814

Ph: 916-442-2308, Fx: 916-497-0921

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