Monday, May 9th, 2005

* Premiums Rejected, Dental Cap Raised, Mandatory Managed Care Questioned
* May Revise Looms This Friday the 13th

In votes made today and previously, key budget committees voted to reject or change key components of Governor Arnold Schwarzenegger’s “Medi-Cal Redesign.” They include rejecting the proposal to impose premiums on Medi-Cal patients in near poverty, and raising the proposed cap on dental coverage for adults on the program.

The Senate Budget Subcommittee on Health, chaired by Senate Denise Moreno Ducheny (D-San Diego), and the Assembly Budget Subcommittee on Health, chaired by Assemblyman Hector De La Torre (D-South Gate) met today and made some preliminary decisions in advance of “May Revise.” This Friday, Governor Schwarzenegger will announce a revised version of his January budget, which will then set off a new set of frenzied month of quick negotiations and decisions before the June deadline for the budget.

While no decision is final until a budget is signed, BELOW is a description of the votes made to date. For a one-page scorecard of each of these proposals, their health and budget impacts, and their status in the budget process, go to the Health Access website, at:

PREMIUMS: Both subcommittee rejected the proposal to impose premiums on 550,000 children, parents, seniors, and people with disabilities on Medi-Cal just over the federal poverty level, including 460,000 children and parents.

DENTAL CAP: Both subcommittees decided to substantially modify the proposal to limit dental benefits to three million adults with Medi-Cal coverage. The Administration’s proposal limited such coverage to $1,000 in a twelve-month period, with some exemptions. Both subcommittees approved language for a $1,800 cap, with more exemptions, and a sunset on the cap in three years.

OUTSOURCING SINGLE POINT OF ENTRY: Both subcommitees rejected the proposal to transfer a portion of Medi-Cal eligibility processing of “single point of entry” forms to Healthy Families vendor (Maximus), from counties.

MANDATORY MANAGED CARE: Substantial questions were raised about the proposal to force hundreds of thousands of seniors, people with disabilities and families into managed care plans. The proposal would geographically expand Medi-Cal managed care plans into 13 counties now without such plans, and force this shift for 262,000 children and parents; would also shift into managed care 554,000 seniors and people with disabilities in 27 counties who are now in fee-for-service plans. The Senate has not made any decisions. The Assembly voted to support the geographic expansion of mandatory managed care for children and families, and in certain counties of aged, blind and disabled; the committee has left other issues open for the time being.

HOSPITAL FINANCING: No specific details have been released on the proposal to restructure the funding for public and safety-net hospitals through a federal waiver, by shifting the risk and responsibility of reimbursements from the state to the counties. The committees have not taken any action, but have received reports that the negotiations with the federal government continue.

For a full analysis of the Governor’s Medi-Cal Redesign proposal, the California Budget Project and the Center for Budget and Policy Priorities have just released a comprehensive paper last week, which is available at the CBP website at:


Whatever the May Revise of the budget indicates, the real fight around the budget seems to be this fall, in a probable special election in November.

Governor Arnold Schwarzenegger is still seeking signatures for the “Live Within Our Means Act.” A campaign committee was reportedly paying $6 a signature to make sure they had enough to file this week, and qualify for a potential special election. The measure would institute a new spending cap, and give the Governor unilateral powers to make cuts to health and other vital services.

When the Governor did not submit a balanced budget this year, he indicated that his plan was to pass a “spending cap” proposal, as a way of making the cuts that he could not get through the Legislature.

HEALTH CUTS LIKELY: To give a sense of what such a proposal would have meant in the past few years in terms of health cuts, here’s a copy of the Health Access Budget Cuts Scorecard, which details cuts that have been proposed by the last two Governors, many of which were rejected as too severe by legislators. These cuts, from provider rate cuts to cap on Healthy Families, could have been made unilaterally by these Governors if this measure had been made law:

SIGN-ON STATEMENT: More than fifty organizations have signed a “Fighting for California’s Future” statement to support a balanced approach to the budget crisis, and oppose such automatic and autocratic policies to cut needed services. For a copy of the fax-back statement that your organization can sign onto, visit:

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