Initial comment on the big budget cuts

Our Headlines:

* Big Cuts to Provider Rates, Medi-Cal Benefits (Including Dental for 3 Million Adults);
* Retread of Proposals Rejected by Previous Legislatures as Too Severe
* Magnitude of Cuts Show Need to Balanced Solution to Budget, Including Taxes
* Health Reform Needed More Than Ever; Logic of Reform Argues Against Proposed Cuts

THE BIG PICTURE: The health cuts would reduce access to care, cut covered benefits, and raise costs for millions of low-income California children, parents, seniors and people with disabilities, and further erodes the health system on which we all rely. This shows why we need a balanced solution to the budget crisis, that includes not just cuts but revenues to prevent the worst of the cuts, and allows people to get the care they need.

THE IMPACT OF THE BIG CUTS: These are cuts we have seen before, that previous Legislatures have rejected as too extreme. The three cuts with the biggest dollar value are provider rate cuts, cuts to benefits, and quarterly status reports to discourage access to care:

* PROVIDER RATE CUTS ($720.9 million): The provider cuts will significantly reduce access to doctors, hospitals, and specialists for the over six million Californians with Medi-Cal coverage. California already has among the worst reimbursement rates in the nation, and half of the state’s doctors don’t take Medi-Cal.
* BENEFIT CUTS ($133.9 million): The millions with Medi-Cal coverage will also lose several health benefits. Three million low-income parents, seniors, and people with disabilities will lose dental coverage under this proposal.
* MORE PAPERWORK LEADING TO LOWER ENROLLMENT ($92.2 million): While the proposal does not seek to directly cut eligibility, it imposes paperwork burdens on low-income families with the purpose of having over one hundred thousand Californians fall off coverage. These ‘quarterly status reports’ are cynical attempts to reduce enrollment at a time when we want and need to increase enrollment.

HEALTH REFORM CONNECTION: The budget shows we need health reform more now than ever, but we also need to follow the logic of health reform, to invest rather than cut into our health system.
* The Governor is right that are Medi-Cal rates are too low, and impose a cost of all of us even with insurance. Yet the budget makes further cuts to Medi-Cal.
* Just as the Governor says that we need to bring in more federal funds through health reform, he should recognize that cutting over a billion dollars in Medi-Cal means that we lose another billion dollars in federal matching funds.
* And while we support the Governor’s effort to raise revenues to fund health coverage expansions that are desperately needed, it would make sense to also raise the funds needed to ensure that Californians keep the coverage they have. We need to balance these cuts with new revenues as well.

We have our work cut out for us.

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