HEALTH BUDGET CUTS ALERT

July 23, 2002

* No major changes to report. Here are some more tools to continue budget advocacy work.

* BELOW is a sample phone script to assist organizations in calling their members to get them to call their legislators. We thank the many organizations that have put out action alerts, fax blasts, and mailers on the budget issue, yet there is no substitute for calling your members one-on-one and either patching them through to the appropriate number or just giving them a reminder and a tip on what to say. Obviously, this phone script should be adapted for the organization, the context, and the relationship with the member.

* BELOW is a sample op-ed by the PICO California Project, customized for a given area and signed by the local community leader. For those organization who can do it, this is another useful sample to work from, by folks who do the op-ed strategy well.

* BELOW is an article from Sunday’s Sacramento Bee on the budget crisis, and specifically the health cuts, which details some of the debate. It’s on the web at:

http://www.sacbee.com/content/politics/story/3665146p-4690976c.html

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DRAFT PHONE SCRIPT

Budget Cuts Campaign

Hi there. My name is ____________(first name), from _______________ (organization).

We are calling to ask our members to contact their state legislators to help to prevent severe budget cuts in education, health care, and ________ (public safety, the environment, your organization’s issue mix).

The State of California has entered a new year without a budget in place. The State Senate passed a budget, but the Assembly Republicans are blocking its passage.

We think they should have passed the budget by their deadline, don’t you agree?

The Senate already cut $7 billion from the budget, and the Assembly Republicans are pushing for more cuts, such as ______________ (immunizations for uninsured children, cancer research, emergency housing assistance, funding for low-performing schools, your example here).

We don’t think the California Legislature should make such severe cuts in core services, even if it means restoring some of the tax cuts California made during the boom years.

Would you make a call to Assemblymember ____________ (legislator’s name), to urge him to pass the Senate budget?

IF PATCH-THROUGH: [Could you do this right now? We can patch you through to his/her office right now, it would be very quick, and we would pick up the expense.]

All you need to say is that you want to leave a message for Assemblymember ____________(legislator’s name), that you are urging him to pass the Senate budget, (and that you wouldn’t mind having the recent tax cuts restored to prevent the severe cuts in ________(issue) being proposed.)

IF NOT PATCH-THROUGH: [His number is 916-XXX-XXXX. Do you need to write that down? Make the call right now. I’ll call tomorrow to see how it went.]

Thank you! You are really helping us protect important services on which we all depend.

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Op-Ed

By Jim Orejel

Today we remain without a state budget. In the coming weeks, our local communities will start paying the price for the Legislature’s inability to reach an agreement. We’ll see community health clinics and childcare centers head towards bankruptcy as their funds are delayed by the budget stalemate, and the elderly and disabled will find key programs they need put on hold.

The hang-up? Taxes, of course. The agreement, passed by the State Senate and now pending before the State Assembly partially restores recent cuts in vehicle license fees to 1999 levels, hikes cigarette taxes and delays corporate tax breaks for two years. Most Assembly Republicans have indicated that they will not vote for a budget that raises taxes- even if these limited taxes make up only $3.5 billion of the plan to close a $24 billion budget gap.

Instead, Assembly Republican leaders propose deeper cuts in services to the poor, elderly and disabled. Specifically, they propose eliminating health care for 1 million low-income, working families- including 600,000 children. They propose ending continuous eligibility for children that would immediately throw nearly 500,000 children off of Medi-Cal.

These legislators are out of step. We know, because we have spent time here in Orange County talking with hundreds of families about the state budget. In our conversations, we have heard time and time again that people are willing to pay a little more in taxes to avert massive cuts in school budgets, law enforcement, or in health. We’re willing to be part of the solution if that solution protects our schools and the health of our families.

The California Health Care Foundation released a public opinion poll this week that confirms what we have been hearing all along. 94% of voters surveyed said they would support a tax increase of some kind to avoid making major cutbacks in health services to low income Californians and the disabled.

So why are the Assembly Republicans holding out? They have yet to come up with a plan to balance the budget without raising taxes. Assembly Minority Leader Dave Cox came out with some cuts on July 1st, yet this list only totals $588 million and falls far short of the billions needed to close the budget gap.

Assemblymember John Campbell, a Republican leader on the Budget Conference Committee and a proponent of massive budget cuts, said recently that legislators should only be concerned with providing “bread, shelter, and water.”

It’s time for regular people to get involved. It’s time for the Legislature to get over political bickering and pass a budget. Call your assemblymember today. Find out where he or she stands on the budget. Make your voice heard.

We deserve to live in a state that has a higher standard for families than bread, water and shelter.

Jim Orejel is the chairperson of the Orange County Congregation Community Organization, a federation of XX congregations working to improve the quality of life in Orange County.

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STALLED BUDGET STREWN WITH THORNY DILEMMAS

By John Hill — Bee Capitol Bureau – (Published July 21, 2002)

It would seem to be a simple matter.

The state is in a fiscal fix. It could save $155 million by making Medi-Cal recipients file paperwork four times a year, instead of only once. That would keep some people who no longer qualified for Medi-Cal from staying enrolled for as long as 12 months.

If only it were that easy. The question of quarterly reports involves complicated issues and tradeoffs — the state, for instance, would miss out on federal money if it forced people off Medi-Cal. Many of those same people would need health care anyway, and the state could be left with the entire bill.

The stalled state budget is replete with such dilemmas, accounting in large part for a partisan standoff that shows no signs of abating.

Republicans in the Assembly say they won’t vote for the budget approved by the Senate that depends on tax increases, including a two-year doubling of the state’s vehicle license fee. They say the state can balance its books by making a number of tough decisions, from ending dental benefits for adult Medi-Cal recipients to reversing the recent trend of opening health care programs to more low-income people.

“We don’t think you help things by allowing various sorts of people who aren’t eligible to use a program,” said John Campbell of Irvine, the ranking Republican in the Assembly on budget matters.

Democrats see the cuts as hard-hearted, as well as fiscally unwise. If Californians are in Medi-Cal or Healthy Families, another subsidized health care program, the federal government pays half to two-thirds of the doctor bill. If they aren’t in these programs, their care will fall to emergency rooms or indigent-care programs whose total cost is covered by state and local governments.

“The idea that there’s some fairy out there that pays for health care is absurd,” said Sen. Steve Peace, D-El Cajon. Peace was chairman of a special six-member budget-writing committee that considered and rejected many of the proposed cuts.

Others point out that if the state is unwilling to cut anything that has a federal match, there wouldn’t be much left to cut.

“Since the entirety of Medi-Cal involves federal funds, the logical result is that you don’t touch Medi-Cal,” said Dan Carson, director of the Legislative Analyst’s Office health and welfare section. “We’re stuck.”

The $99 billion budget was approved by the Senate on June 30, two days before the start of the fiscal year, only to become bogged down in the Assembly. Democrats would have to win over four GOP members in the Assembly to give the budget the required two-thirds majority.

Much of the rhetoric has focused on cuts supported by Republicans in the conference committee and rejected by Democrats. Some of the cuts came from Gov. Gray Davis’ budget proposals in January and May, some from the nonpartisan analyst’s office and others from the Republicans themselves.

Republicans and Democrats don’t agree on the total amount of the proposed cuts, much less whether to do them. Republicans say the total approaches $5 billion, enough to wipe out the need for new taxes called for in the Senate-approved budget and then some.

Democrats say that a more realistic figure would be in the $1 billion range, which still leaves a shortage to be covered by taxes or other means. Peace said that many of the health-care and social-service cuts would require federal waivers “beyond the realm of what we reasonably could get.”

If you don’t consider cuts to schools and local governments, two areas that both political parties agree they want to protect, the savings amount to about $900 million, Peace said. The only way to avoid tax increases, he said, would be to cut into the payments the state makes to local governments to make up for the revenue they lost from reductions in the vehicle license fee, or to reduce funding for schools.

Republicans, meanwhile, say they are reluctant to put out a definitive list of their proposed cuts without a signal that Democrats are willing to listen. Otherwise, they say, the Democrats will just latch onto one or two proposals to discredit them.

“There’s no reason to go through the exercise until we get the message that there’s a willingness to work with us,” Campbell said.

In fact, it is not a simple matter to tally the proposed cuts. The analyst’s office, which crunches budget numbers for the Legislature, hasn’t done it. Carson called it a “very formidable” task.

One complication is that one cut could influence how much you would save from another. The Legislature could reduce the number of medical procedures the state covers under Medi-Cal, for instance. But then another possible cut — cutting the rates the state pays to Medi-Cal doctors and other providers — would not save as much, because there would be fewer Medi-Cal visits.

The budget is rife with such complications, a fact that can sometimes be lost in the daily partisan volleys over the standoff.

GOP lawmakers were willing to go along with the Medi-Cal quarterly reports proposed by Davis in May to help close the state’s budget shortfall. They saw it as one step toward avoiding tax increases that would touch just about every Californian.

Democrats countered that the quarterly reports would not only force ineligible people off Medi-Cal, they would also throw off low-income people whose day-to-day struggles make it hard to keep up with paperwork.

The change also might not comply with federal law, they said.

The two parties can’t even agree whether the $155 million figure takes into account the offsetting costs of government workers processing extra paperwork.

There was yet another element to the Democratic critique: What’s wrong, they asked, with a few more low-income people getting health care for a few extra months? Why make people jump through hoops to get something that, after all, contributes to the common good?

“It’s basically like making someone file their taxes four times a year,” said Anthony Wright, executive director of Health Access, a statewide health-care consumer coalition of 200 organizations.

Lawmakers considered cutting $263 million in Medi-Cal “optional” benefits, primarily dental care for adults. Democratic budget staff pointed out that the cut would probably lead some dentists to drop Medi-Cal patients because children alone don’t make it worthwhile.

Then, too, people with untreated tooth pain might end up in emergency rooms, Democratic analysts say. People who lost teeth and couldn’t get dentures would develop eating and speech difficulties, and have a harder time finding jobs.

Republicans countered that many small-business health-care plans don’t cover dental care.

“A lot of people paying taxes to support Medi-Cal are supporting a health plan they don’t get themselves,” Campbell said, “and that’s just wrong.”

But cut funding for medical supplies, health advocates say, and people with diabetes might stop using test strips to monitor their condition.

“The consequence is delayed and denied care that could lead to serious health conditions, including, in the case of a diabetic who doesn’t do the tests, amputations,” Wright said.

Another controversial cut involved the Childhood Health and Disability Prevention Program, which screens poor children for health problems and provides immunizations.

Davis proposed cutting the $70 million program in January because many of the children covered by it also qualify for Medi-Cal or Healthy Families. The administration backed off in April after an outcry from health care advocates.

But Republicans brought it up again in budget deliberations, saying that the small percentage of children not eligible for other health plans could be covered by community clinics, which would get more state money for that purpose.

Democrats said the GOP misunderstood the purpose of the program — to reach out to poor families and encourage them to get enrolled in subsidized government plans. And if those who didn’t qualify for government health-care programs — mostly the children of undocumented immigrants — were not immunized, the whole population could suffer.

Much of the nitty-gritty budget debate has focused on issues like this. One of the major Democratic priorities in recent years has been to “remove barriers” to health care for the state’s uninsured — a number pegged most recently at 4.5 million people.

Democrats and health-care advocates say that it would be foolhardy to undo this progress. Wright estimates that all the cuts combined would drive as many as a million people into the ranks of the uninsured. That calamity could be avoided, they say, by simply returning to the vehicle license fee rate that existed a couple of years ago, raising taxes on cigarettes and taking a few other steps to temporarily boost revenues.

But Republicans point out that those measures, too, have consequences for Californians.

One of the tax measures approved with the Senate budget would suspend for two years the “net operating loss” deduction, which allows businesses to count losses against revenue in future years.

“It may be fine for a company that has millions or tens of millions of assets and can use cash flow to survive,” said Greg Turner, legislative director for Cal-Tax, which advocates against what it sees as unnecessary taxes. “That’s not so much true for smaller companies.”

The two-year loss of the deduction could be a factor in some of those companies going under, he said.

California’s treasury will only grow, Turner said, if businesses are allowed to thrive.



Anthony E. Wright

Health Access

1127 11th St., #234, Sacramento, CA 95814

Ph: 916-442-2308, Fx: 916-497-0921

awright@health-access.org

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

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