The Ryan Budget and the impact on CA…

Wednesday, May 11, 2011


* Pushback in California and Nationwide Against Party-Line Vote in House of Representatives on Ryan Budget Proposal to End Medicaid and Medicare As We Know It

* Governor Brown, Senators Boxer and Feinstein Oppose to Medicaid “Block Grant” Proposal, Warn That Would Shift Billions of Dollars in Costs to Cash-Strapped California

* CBPP Study: Ryan Proposal Would Have Meant $35 Billion in Less Medicaid $ to CA in 2000-09; Much More in Future

Also: LA Health Access Convening Tomorrow with Dr. Mitch Katz: Update on Healthy Way LA, and on Pending State Legislation to Implement and Improve Health Reform

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Less than a month after their vote on a budget resolution, members of the U.S. House of Representatives are facing mounting questions about and opposition to this 2012 budget plan to end Medicare and Medicaid as we know it.

The vote on the budget plan authored by Rep. Paul Ryan (R-WI), taken right before the Easter recess, was passed with all Republican votes, opposed by all Democratic members and 4 Republicans from outside California. In California, all California Republicans voted for the proposal, to replace Medicare with a voucher program to buy private coverage, and replace Medicaid with a “block grant” program that would shift billions of dollars of costs to California. The proposal also repeals the Affordable Care Act, leaving the millions of Californians who would be newly covered under the law uninsured.

Health advocates warned that if this budget were ever to be enacted, the ramifications of this proposal–essentially repealing and/or replacing Medicare, Medicaid and the Affordable Care Act–would be devastating, from seniors and families paying far more for care and coverage to millions more becoming uninsured. Advocates charge that the Ryan proposal passed by the House GOP does nothing to control the main issue of medical inflation but simply shifts major costs of care from the federal government to states, seniors, and families–all to pay for trillions of dollars in tax cuts.

A California Budget Project analysis indicates that the overall House budget’s “binding cap” on federal spending “would force deep and immediate cuts to core public services… In the near term, the House budget plan proposed to deeply cut and dramatically restructure programs that assist millions of seniors and other Californians, including Medicare, Medicaid, and Supplemental Nutrition Assistance Program (SNAP) food assistance. Over the longer term, the House budget plan assumes the elimination of federal funding for a range of programs and services, potentially including education, medical research, environmental protection, and housing and child care assistance.” The Center for Budget and Policy Priorities has much more fact sheets and information about the Ryan budget, its impact on health and other services, and because of its tax giveaways, its minimal impact on reducing the deficit.

Of specific concern for California is the impact of such a proposal on the already strained California budget crisis. The proposal, voted on by all California GOP Representative, would make the California budget deficit signficantly worse by billions of dollars–forcing the state to either raise taxes or make worse cuts. If this Medicaid “block grant” proposal was put in place in 2000, California would have lost $35 billion in federal Medicaid dollars from 2000-2009, according to an analysis by the Center for Budget and Policy Priorities. In 2009, the reduction in federal Medicaid dollars to California would have been 31%.

California GOP Representatives, who all voted for the Ryan budget and the Medicaid “block grant” proposal, were going against the advice of California’s elected leaders, who warned of the devastating impact on California citizens and the state as a whole.

* Governor Jerry Brown co-signed an April 4th letter from 16 Governors to Congressional leaders, warning against a “transformation of the Medicaid program’s finances that significantly shifts the costs and risks to states” and that would “severly undercut our ability to provide health care to our residents and adequately pay providers.”

* Senator Barbara Boxer co-signed an April 12th letter with other Senators to President Obama, opposed to a Medicaid block grant or other spending cap, stating that “complying with a spending cap would thus require unprecedented draconian cuts to Medicaid over time.”

* Senator Dianne Feinstein wrote her own letter on April 12th, warning that “Converting Medicaid to a block grant would harm the 7.2 million Californians who currently receive basic health care from the state program, Medi-Cal, and would shift costs to the state, counties, beneificiaries, and health care providers. Through such proposals, California stands to lose an estimated $147.8 billion–$878.7 billion in federal investment in Medi-Cal, and an additional $60.1 billion from the Medicaid expansion included in the Affordable Care Act.”

In a heralded speech mid-April on the “future we want” (click for key passages), President Barack Obama has proposed his own deficit reduction proposal, a more balanced approached that includes both cuts and revenues, yet explicitly rejects block grants in Medicaid, changing Medicare to a voucher system, or repealing the Affordable Care Act.

With Congress back in session, this debate is playing out in several ways. The GOP-controlled House is continuing to pass bills to repeal certain aspects of the Affordable Care Act, including a bill last week to defund the creation of state Exchanges. Another bill has been introduced to remove the maintenance-of-effort requirement in federal law that prevent states from cutting eligibility and enrollment is Medicaid and SCHIP.

The main venue is the current debate over raising the nation’s debt ceiling, a routine but necessary vote that GOP lawmakers are insisting be packaged with major cuts and policy changes, including the elements of the Ryan budget. It’s unclear what negotiation will yield.
Advocates are working to simply inform Californians and Americans about the vote, the proposal, and its impact for California. As always, more information is available on our website at We also post breaking news (like today’s discussion at the second meeting of the California Exchange board) on our Twitter feed, at

LA BREAKFAST BRIEFING: LIHP/HEALTHY WAY LA UPDATE WITH DR. MITCH KATZ; LEGISLATIVE UPDATE: Tomorrow morning, Thursday, May 12th, Health Access is hosting a breakfast briefing in Los Angeles on the implementation of health reform, featuring Dr. Mitch Katz, Director of the Los Angeles County Health Department. Dr, Katz will give an update on LA’s Low-Income Health Program (LIHP), Healthy Way LA. Health Access California will also provide an update about pending health reform-related legislation. The event is from 9am-12noon at Planned Parenthood L.A., 400 W. 30th Street, Los Angeles, CA 90007. Please RSVP to Nancy Gomez at

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