The impacts and the numbers…

Governor Arnold Schwarzenegger used to be the champion of health reform. He supported a reform model on the basis of “shared responsibility”–the state would do its part, but he’ll ask contributions from individuals, employers, providers, and local, state and federal governments, etc. He proposed raising revenues–both legislatively and going to the ballot–to expand programs like Medi-Cal and Healthy Families, as a way to get more of the 50/50 federal matching funds that were available to use, but we were not taking advantage of because of our lack of investment.

Things have changed radically. This past year, he proposed to cut Medi-Cal and eliminate Healthy Families. He refused to consider revenues to save these programs he appropriately sought to expand merely two years ago.

And now, he’s been badmouthing health reform as a burden to states. For the last week, GOP Senators have invoked him in their opposition to health reform in floor speeches. For all practical purposes, he has emerged as an opponent to health reform, highlighting the cost to states.

Yesterday, the Governor sent a letter to the California Congressional delegation, circulating a $3 billion figure as the cost to the state of California. It’s hard to account for how highly inflated that number is. It includes a Medi-Cal provider rate increase that is not required, an assumption that every single person eligible will sign up, and neglects that it will take nearly 8 years–a couple of Governors from now–for full implementation and any costs to materialize.

After a thorough review of the bills, Health Access has compiled our own estimates (now newly available on our website) of the cost impacts on California.

Here’s the short version: the state gets savings of a couple hundred million dollars in the first several years. Even when the Medicaid expansion for 1.5 to 2 million low-income Californians takes into effect in 2013 or 2014, the federal government will pick up 100% of the cost of newly-eligibles for 2-3 years. Finally, there is a cost to the states–but not with the normal 50/50 split, but with either 82% or 91% of the bill being picked up by the feds. That’s somewhere between a 4:1 to a 9:1 match–much more generous than the current matches in Medi-Cal (1:1) or Healthy Families (2:1).

For states, that’s not a burden, that’s a bargain.

So much for “shared responsibility.” What really seems to get Governor Schwarzenegger is that he won’t be able to make additional cuts on both Medi-Cal and SCHIP, because there would be “maintenance of effort” requirements that states continue what they have been doing. In his letter, he threatens the complete elimination of In-Home Support Services, CalWORKS and other programs.

I understand that every Governor wants to bring in more federal dollars. But misrepresenting our situation won’t help. In order to get federal funds to solve our budget woes, he is ready to take hostages–whether that be IHSS or CalWORKS at the state level, or health reform at the federal.

That can’t be the only or best way to get the added federal funds we agree we need.

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