July 7th, 2004

* Budget Talks Stalled Over Local Government Agreement

* Northern California Grocery Workers Negotiate Over Health Benefits


Last week, the new fiscal year for the State of California started, once again, without a state budget in place. As of this writing, Governor Schwarzenegger and key legislators still indicate that a budget agreement is near, and that passage and signing of a budget could be done within the next week, but nothing is certain.

LOCAL GOVERNMENT ISSUE: The biggest issue that still remains unresolved regards the funding of local governments. The California Budget Project has a full budget brief on the issues regarding the local government agreement, available at:

While the disagreements are not directly over health issues, the impasse raises concerns for health advocates in two ways:

* PROCESS: The longer an agreement is not made, there is greater potential for legislators or others to bring back issues that are “off the table,” such as the proposed cuts to health care that have been withdrawn or rejected recently. And if there is an extended period of time without a budget as in previous years, then health providers may again face the prospect of late payments and reimbursements. While neither prospect is likely now, it becomes more likely with each passing day.

* SUBSTANCE: The substance of the local government agreement has implications for health and human services. As more of the budget is guaranteed for the funding of designated areas, such as local government activities, there are consequences for the rest of the state budget. Protecting local government funding means that during budget crises, there will be more pressure to cut health care and other “unprotected” human services, such as Medi-Cal and Healthy Families.

MEDICAL REDESIGN UPCOMING: Health Access will continue to monitor the budget talks and report if there is any movement. Regardless of the outcome of this year’s budget, health advocates are also gearing up to discuss the Governor Schwarzenegger’s “Medi-Cal Redesign” proposal, which is scheduled to be released in less than a month, on August 2nd.


Negotiations are now underway between grocery store chains in Northern California and their workers, represented by the United Food and Commercial Workers (UFCW). This could lead to a major fight over the future of health benefits for tens of thousands of Californians, with implications for the rest of us.

EARLIER STRIKE: Earlier this year in Southern California, these contract disputes, mainly over health care, led to a 139-day strike and lockout of nearly 70,000 workers, extending from October 11th, 2004 to Febrary 29th, 2004.

DEADLINES UPCOMING: The contract of UCFW Local 588, which represents 15,000 Sacramento-area grocery workers, expires in a week-and-a-half, on July 17th, 2004. The contracts with 30,000 Bay Area grocery workers expire soon afterwards, on September 11th, 2004.

HEALTH THE ISSUE: In both cases, the biggest dispute is over health benefits, as described in this July 4th San Francisco Chronicle article, entitled “Grocery Talks To Move Northward: Health Care Looms As Big Issue, As It Did In Rest Of The State.”

SUPPORT SOUGHT: UFCW Local 588 is looking for support from health advocacy and community organizations in their fight to preserve the health benefits of their workers. When large employers scale back the health benefits of their workers, or drop them altogether for certain groups of employees, it creates more uninsured and underinsured onto an already-overburdened health care system. In addition, such changes creates additional pressure on competing employers to follow suit and also scale back coverage, leading to a ripple effect through the state. UFCW Local 588 has started a Healthy Californians coalition to help fight to preserve health care benefits for working Californians and their families. The coalition has a web page at:

Health Access and other health advocates support this and other efforts to preserve the health benefits that California workers now rely on. Organizations who wish to join the Healthy Californians coalition can sign up at the web site at:

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