Friday, July 23rd, 2004

* BUDGET: Still in Limbo; Medi-Cal Redesign Announcements Soon

* PROPOSITIONS: Ballot Arguments Now Posted

* BLUE CROSS MERGER: Different Decisions From California Regulators

BUDGET STILL IN LIMBO: As of this writing, the State of California has been operating for over three weeks without a budget, and there does not seem to be major progress in legislators and the Governor coming to an agreement. Earlier this week, the State Senate voted on a proposed budget, which got a majority of Senators, all Democrats, but did not get the Republican votes needed for 2/3 passage.

Unlike in previous years, the cause of the disagreement does not seem to be health care funding or issues. However, the later that this budget gets delayed, the possibility increases that issues might get reopened, such as the health care cuts that have been rejected. Also, the lateness of a budget agreement will soon start to impact providers of health and human services that contract with the state.


MEDI-CAL REDESIGN: It is unclear how the late budget and current negotiations would impact the Administration’s proposal for “Medi-Cal redesign,” which is scheduled to be unveiled on August 2nd. Little information has been shared on the exact contents of the proposal, although the broad concepts have stayed the same: changes in eligibility, cost-sharing, benefits, managed care, and hospital financing, resulting in Medi-Cal recipients paying more for less care.

This coming WEDNESDAY, JULY 28th,  health advocates in Sacramento will have the opportunity to learn more about the concepts behind Medi-Cal redesign, in two roundtable discussions: 

  • “Medicaid HIFA Waivers: Lessons for California.” 10:00am-11:30am. State Capitol, Room 112. Sponsored by the Henry J. Kaiser Family Foundation and the UC Berkeley Center for Health and Public Policy Studies. Please RSVP to, or call (510)643-1675 with questions. 
  • “A Roundtable Discussion on the Governor’s Proposal to Restructure the Medi-Cal Program.” 3:00-4:30pm, 1121 L St, Suite 904. The event is sponsored by the California Budget Project and the Center on Budget and Policy Priorities. The two groups have just released a detailed analysis, available at the CBP website at Please RSVP to, or call (916)444-0500. 

PROPOSITIONS: The ballot arguments for the fourteen measures slated to be voted on in November 2004 are now posted online at the Secretary of State’s webpage, at: 

Several of the proposition relate to health care, and others have significant implications for health into the future. This includes the much-discussed Proposition 72, the referendum on the law (SB 2) that protects and expands health coverage for workers and their families. New information is available at


BLUE CROSS MERGER: Earlier today, California insurance regulators ruled in different ways on the hotly contested merger of Anthem and Wellpoint, the parent company of Blue Cross of California.

The California Department of Managed Health Care (DMHC), headed by Director Cindy Ehnes, approved the merger, with a variety of conditions and “undertakings.” These conditions included efforts for Blue Cross to improve its quality of care ratings, maintain reserve levels, report annually on the benefits of the merger, continue to participate in public insurance programs, direct investments to improve access to care in rural and underserved communities, and  spend $15 million on Healthy Families enrollment. More information is available at the DMHC’s website:


In contrast, Insurance Commissioner John Garamendi rejected the merger. He found that the “commitments they were willing to make do no alleviate the fundamental problems with the deal.” Due to the cost of the merger, the Commissioner found that “because the merger provides an increased need to upstream profits to the parent [company], it is prejudicial, unfair, and unreasonable to policyholders.” He cited the “excessive compensation” to executives, as well as an “anti-competitive” impact nationally, that will ultimately impact the California market. His letter in opposition is on his website, at:

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