Many of us have watched the budget proposals by the Legislature and the Governor over the last several months that have included a series of benefit caps, restrictions on specific services, and increases in consumers’ share of cost to close a breathtaking budget gap in California’s finances. Health Access has been among those who have urged a balanced approach to the budget impasse by softening unavoidable service cuts with new revenues, without additional cuts in services. As the national and state economies falter, it is anticipated that more and more Californians will become reliant on the safety net including public programs until they can land a new job, replace their health insurance, or stabilize their mortgage financing.
While the budget negotiations continue and more cuts looming, we now have a Real Life Example of the cuts already made, as we look at the actual new rules for the Healthy Families Program. Healthy Families is California’s children’s health insurance program, which is funded by state and federal dollars for low-income children whose families who have too much income to qualify for the Medi-Cal program. These are not proposals or negotiating positions, but these are new rules for almost one million children that are effective February 1, 2009. These new rules were published on Christmas Eve as emergency regulations, open for public comment for only five working days. (No doubt most of us were otherwise engaged in the week between Christmas and New Year’s!) The final changes include:
· Dental benefits per child are capped at $1500 per calendar year (with some exceptions). Research substantiates the importance of dental care for children in their general health, ability to learn, and positive impact on other health outcomes.
· An increase in monthly premiums (based on family income cut-offs) from $6 or $9 to $12 or $17. Although those sound like minimal increases, remember these are monthly dollar amounts per child for families with incomes as low as $21,000 per year. These costs are estimated to cause tens of thousands of families to delay enrollment or not continue their children on Healthy Families.
This is billed as a cost-saving measure, but in an ironic twist, the state estimates the changes to premiums will result in savings of state dollars to be a relatively paltry $2.2 million in the current year. However, this additional cost sharing by consumers will also result in a loss of federal dollars to the state of $3.8 million this year. The changes to dental benefits will not result in savings in state dollars during the current fiscal year, but will result in the loss of federal matching funds to the California’s Healthy Families program of $3.3 million next year. It seems these cuts impose more problems for patients than savings for the state.