• County programs for children’s coverage funded for waiting lists; Goal of universal coverage by 2008
  • Other items: $10 million for trauma care; some language on new Medicaid documentation
  • Not in budget: provide rate increase, Part D co-payments, etc.

The Budget Conference Committee, chaired by Senator Wes Chesbro and Assemblyman John Laird, is finished up its final meeting, closing out its work crafting the state budget for 2006-07. Of particular note, the conference committee voted to include funds to expand county programs for children’s coverage, and to start the administrative actions needed to expand state programs to cover all children up to 300% of the federal poverty level by 2008.


Assemblyman John Laird described a compromise between the Assembly and Senate budgets with regards to children’s coverage. “Basically, the compromise sets a goal for 2008 in funding health insurance for all kids in California… For this year, except for a small amount of money to help the Administration set up some of the infrastructure, this basically takes the Governor’s proposal of the $22 million to support the existing counties in their programs.” The Senate originally only had the Governor’s proposal; the Assembly had budgeted twice as much for county programs, and included money to start planning an expansion to all children.

In addition to $22,783,000 to fund the exisiting county “Healthy Kids” programs, the Conference Committee compromise proposal does fund seven administrative positions, at $1,880,000, to start the implementation of a full Healthy Families expansion. It would extend eligibility to *all* children up to 275% of the federal poverty level effective July 1, 2007, and up to 300% (roughly $49,800 for a family of three) effective July 1, 2008.

Assemblyman Laird also explained that “there’s also a mechanism in this that if the voters approve the tobacco tax measure, it stands back… and defers to that measure.” A $2.60 tobacco tax measure is slated for the November 2006 ballot that would fund universal children’s coverage, among other health items.

The Republicans on the committee both raised objections. Assemblyman Rick Keene urged that this item not be considered in the conference committee, given the policy issues, “Are we going to start providing health care for children of illegal immigrants, and are we going to provide health care for people that are in that wage rate[$40-50K] and above? Those are very serious policy concerns.”

Assemblyman Laird responded: “We are talking about the fundamental point, that right now we budget for a whole host of health programs in this state… It is appropriate for us budgetarily to be prudent and rearrange the money; if providing every kid with health care means we spend less on emergency room visits or ongoing care because prevention is done, that over time that might be the cheaper thing… but that might also the most humane thing.”

Republican Senator Hollingsworth raised his concerns more directly, saying that this is “an another incentive for illegal immigration… you need to know that this is a very large issues for our caucues. This was not the same as the Governor’s May Revise proposal; that was bad enough. This is [a] much larger issue, much larger cost, and just not the right thing to do.”

Assemblyman Laird also responded, focusing on the fact that the proposal was geared to cover *all* children. “If the facts were as Mr. Hollingsworth described, I might have trouble with the program: This does not single out only illegal immigrants for health insurance, it applies to anybody [up to] 300% of the federal poverty level.”

The Conference Committee approved the compromise language on a 2-1, 2-1 vote, with Democrats supporting and Republicans opposing. Governor Schwarzenegger’s Administration also indicated that they did not support the compromise, prompting Budget Committee Chair Wes Chesbro to comment that “we have more work to do.” It is likely this item will continue to be a discussion point as the budget moves through the process.


Other actions by the Budget Conference Committee of note for health advocates:
* TRAUMA CARE: The committee funded trauma care by $10 million, a compromise between the Senate and Assembly, on a party line vote. The item includes budget trailer bill language that the money goes away if the above-mentioned tobacco tax measure is passed (which would provide greater funds for hospitals in general).
* MEDI-CAL MANAGED CARE RATES: The committee approved $48 million for Medi-Cal managed care rate adjustments, taking the more generous Assembly proposal, with some budget trailer bill language.
* HEALTH-E-APP INCENTIVE: Another compromise between the Senate and Assembly on children’s coverage was on Healthy Families outreach and enrollment, allowing a $10 additional incentives (from $50 to $60) for certified application assisters (CAAs) who use the Health-E-App program.


DOCUMENTATION REQUIREMENTS: While it was not discussed, the conference committee is expected to include trailer bill language with regard to the new federal Medicaid documentation requirements. New guidance from the federal Centers for Medicare and Medicaid Services has just been released to implement these new provisions from the Deficit Reduction Act (DRA) passed earlier this year by Congress. The documentation requirements are seen as major barrier to coverage to the millions of both current and prospective Medicaid enrollees who are eligible, but simply may not be able to produce the documents required.

The state budget trailer bill language attempts to mitigate some but not all of the barriers raised by the federal requirements, allowing counties and others to provide leeway and assistance to those who will have trouble producing birth certificates, etc, especially where federal funds are available. However, the budget does not provide state funds to continue to cover these people who may be unfairly restricted from needed coverage or care because of this federal issue.

PART D CO-PAYS: The budget also does not include another major priority of health advocates, to cover the newly-imposed prescription drug co-payments on one million “dual-eligible” seniors and people with disabilities. These vulnerable patients, who are both Medi-Cal and Medicare, often taken 10 or more drugs, and are finding these co-payments a major cost on their very limited income. Neither the Assembly or the Senate responded to calls to cover these costs, and so it was not an item for discussion in the conference committee.

Another issue for health consumer advocates–increasing Medi-Cal provider rates, which are among the lowest in the nation–was also not in either budget and not discussed in conference committee.


The Conference Committee approved a final budget, 2-1, 2-1, on a party line vote. The budget still needs to be approved by the full Assembly and Senate, by a two-thirds vote, and all items are still subject to change in that process. When a budget reaches the Governor’s desk, he also has the ability to line-item veto budget items.

The Conference Committee’s action is closing down their work is part of an effort to get the budget done “early” this year, attempting to make the June 15th deadline for the Legislature to pass a budget, a deadline that was last met two decades ago in 1986.

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