This afternoon, the Senate Budget Committee met to review details of the budget deal announced on Tuesday by Governor Brown, Assembly Speaker Toni Atkins, and Senate President Pro Tempore Kevin de León. Most notably, the agreed upon 2015-16 state budget includes a historic expansion of full-scope Medi-Cal for low-income children regardless of immigration status. While this major victory brings us one step closer to #Health4All Californians, the final budget included few other investments sought by health and human service advocates, including restorations to Medi-Cal benefits and rates.  

Beyond coverage for all California children, other health augmentations included restoration of Denti-Cal reimbursement rates, and investments in public health programs around HIV and hepatitis C prevention. 

For a summary of wins and losses in the budget deal for health care consumers, see our recent blog and our just updated Budget Scorecard

The budget agreement announced on June 16 outlines broad areas of consensus between the Governor and the Legislature, including which big ticket items will be funded and, implicitly, which will not. The fine details of the FY 2015-16 budget—the exact funding levels, effective dates, and programmatic scope of programs—are set forth in the omnibus health budget trailer bills, AB 94 and SB 75. While this agreement is already in place, the Legislature has to formally pass the main budget bill and trailer bills, and the Governor is expected to sign them prior to the start of the budget year on July 1. Here are highlights of budget priorities for health care consumers, starting with the good news.  


*Health4All: The budget allocates $40 million to enroll undocumented low-income children in full-scope Medi-Cal. This effort is projected to enroll 170,000 children in Medicaid managed care and cost $132 million/year under full implementation for a full year. The budget deal includes language directing DHCS to seek federal matching funds for this expansion; if federal funds are not available, then state-only funds will be used to provide coverage.  Coverage for kids will be available no later than May 1, 2016, which is five months later than what the Legislature initially proposed.  As noted in the press conference announcing the budget deal, the delayed start date resolved the disagreement between the Governor and Legislature about how many children would actually enroll.  Unfortunately, language requiring the state to research the feasibility of capped enrollment for undocumented adults was not included in the final budget deal. Senator Lara has committed to continue pursuing a path for adults to be covered in SB 4.

*Eliminate Rate Reductions for Dental Providers: The final budget eliminates the 10% rate reduction adopted in 2011 for Medi-Cal dental providers effective July 1, 2015. A recent state audit of the Denti-Cal program revealed extreme access issues because of low reimbursement rates for dental providers.

*Investments in Public Health Programs: Though exact amounts are not known at this time, the budget deal includes funding for Hepatitis C (HCV) Linkage to Care Projects; the Syringe Exchange Program, which helps prevent HIV and Hep C and other infectious diseases; and Pre-Exposure Prophylaxis (PrEP) Access and Outreach Program, which will help develop protocols for outreach to targeted at-risk populations. 


The budget is notable in terms of what’s missing: long-sought restorations to Medi-Cal benefits and rates cut during the recession. There may be opportunity to look at these issues, though in the larger context of Medi-Cal financing in the special session Gov. Brown called (see his Resolution). The health care special session, which will run concurrently with the regular legislative session, will address Medi-Cal financing and a revamping and expansion of the MCO (managed care organization, or health plan) tax. This existing tax on managed care plans helps draw down federal funds and provides about $1 billion of funding to the Medi-Cal program. Now it needs to be reconfigured to conform to federal guidelines. A revamped MCO tax or any other tax considered to fund Medi-Cal would still require a 2/3 vote, meaning support from Republicans as well as Democrats, but a special session allows more flexibility in terms of legislative deadlines, and measures passed in special session and signed by the Governor go into effect immediately. Health consumer advocates plan to actively participate in this effort.

The budget trailer bills also includes the following policy changes or initiatives: 

*Eliminating language on Medi-Cal co-pays for non-emergency visits to the ER(a violation of federal law): The budget trailer bill eliminates statutory language adopted during the recession that directs the state to implement a copay for emergency room usage for non-emergencies. While this copay has never been implemented, as it has not been approved by the federal government, legislators sought to take this out of California law, so it isn’t misused in the future.  

*Information on how to apply for insurance affordability programs like Covered CA or Medi-Cal. Enrolling providers who participate in Limited Benefit and Special Population Programs (Every Woman Counts, Family Planning Access Care and Treatment or FPACT and IMProving Access, Counseling, and Treatment for Californians with Prostate Cancer (IMPACT)) will be required to provide individuals with information on how to apply for programs such as Medi-Cal and Covered California.

*LifeLong Community Clinic: The budget allocates $2 million to support an urgent care clinic operated by the LifeLong Community Clinic that will serve communities affected by the closure of Doctors Medical Center in West Contra Costa County.

*Child Health and Disability Prevention Program Dental Referral. Requires public health programs and providers to refer all Medi-Cal-eligible children aged one year or older to a dentist participating in the Medi-Cal program.

*ADAP Modernization. This budget updates financial eligibility for AIDS Drug Assistance Program (ADAP) and the Office of AIDS Health Insurance Premium Payment program to consider family size and increase the income limit for these programs. 

The Senate and Assembly will vote on the budget bill and trailer bills tomorrow. 

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