Budget Deal Reached!

The Legislature and the Governor have reached a budget deal! The Budget Conference Committee convened on Thursday night to take final action on budget issues in Conference Committee, which is described below. See how health priorities fared in our budget scorecard.

The revised budget includes several limited but important investments in health and human services, including in child care, housing, and other areas. In particular, the budget including the long-sought repeal of the Maximum Family Grant Rule in CalWORKS. The budget deal repeals the Maximum Family Grant rule in CalWORKS, a racist and punitive policy that puts families deeper into poverty. Health Access congratulates our allies in the health and human services community for this long overdue victory!

On health care items, details are still trickling out about the final budget deal, but we do understand it includes the following:

Medi-Cal Estate Recovery: We understand the budget deal includes funds ($26M GF) to limit Medi-Cal estate recovery to long-term care services, consistent with federal requirements. The federal government requires states to recoup certain medical costs – mostly related to nursing home care – from the estates of some Medi-Cal patients after they die. Current California policy, however, seeks repayment beyond the federal minimum and a patient’s estate is expected to pay back the value of ALL coverage, including premiums for managed care plans, received after a patient turns 55. This policy unfairly targets older Medi-Cal recipients (higher income Covered California patients don’t have to repay their subsidies), and discourages enrollment and home ownership. Health advocates have made this a top priority and are pleased the California budget is limiting estate recovery to the minimum required by federal law, aligning California with 40 other states.

Restoration of Acupuncture Benefit in Medi-Cal: The Conference Committee took action to allocate $3.7 million GF in 2016-17 (and $4.4 million ongoing) to restore the acupuncture optional benefit in the Medi-Cal program. This is a positive step toward restoring the non-federally mandated Medi-Cal benefits that were eliminated in 2009 for fiscal, not policy reasons. Denti-Cal was only partially restored in 2013. The remaining benefits that continue to be excluded in Medi-Cal coverage are: audiology, chiropractic, incontinence creams & washes, optician/optical labs, podiatry, vision, and speech therapy. Health Access will continue to advocate for full restoration these benefits, along with full adult dental benefits.

Medi-Cal Interpreters for Medi-Cal: The Senate and Assembly previously approved $15 million for in-person interpreters to assist Medi-Cal patients who do not speak English well. The Conference Committee reduced this amount to a one-time $3M GF allocation to establish a multi-county pilot project. These funds are contingent upon enactment of legislation authorizing the project. Both federal and state law require that all patients who need an interpreter should have access to one. About 40% of California residents regularly speak a language other than English, and many of the newly insured have language access needs. Language barriers can cause patients to be misdiagnosed, not get appropriate or timely treatment, and cause medical errors that jeopardize safety.

Hepatitis Initiatives: The Conference Committee allocated a one-time $1.4M GF allocation for Hepatitis Initiatives that increase Hepatitis B vaccinations for high-risk adults and provide resources for rapid Hepatitis C and HIV test kits. The Senate had provided on-going support for these initiatives.

Children’s Dental Disease Prevention Program (CDDPP): Both the Assembly and Senate restored $3.2M GF funding for CDDPP, which provided school-based oral health prevention services to 300,000 low-income school children in 32 counties for nearly three decades before it was eliminated during the recession. 

Delay of the Newly Qualified Immigrant (NQI) Wrap: Both houses approved the Administration’s May Revision proposal to delay implementation of the NQI wrap program for one year. The program would transition Medi-Cal expansion adults who have less than five years in a “qualified immigration status” to Covered California with wraparound services. Advocates, including Health Access, Western Center on Law and Poverty, and California Pan Ethnic Health Network had raised concerns about the transition given its complexity and workability.

Both houses acted to improve access and affordability for individuals living with HIV or AIDS by eliminating cost-sharing for individuals enrolled in the AIDS Drug Assistance Program (ADAP) with annual incomes between 400 and 500 percent of the Federal poverty level, making it more affordable and accessible to patients, which will result in savings to the state. The Legislature also approved the development of a Pre-Exposure Prophylaxis (PrEP) Affordability Program to cover PrEP-related copays, coinsurance, and deductibles incurred by all individuals accessing PrEP in California with annual incomes below 500 percent of the federal poverty level. Finally, both houses proposed $8.6 million (federal funds and ADAP rebate funds) for the Office of AIDS’ Health Insurance Premium Payment (OA-HIPP) Program, which covers premiums, copays, coinsurance, and deductibles incurred by all eligible people living with HIV/AIDS in California.

The conference budget deal also includes $33 million/year for three years for medical residency programs, including clinic-based Teaching Health Centers, to increase to primary care workforce.

Finally, the deal includes budget trailer language to allow Covered California limited authority to issue emergency regulations.


Medi-Cal Data Collection: The Conference Committee ultimately did not allocate any funds to align Medi-Cal’s health plan data collection and reporting requirements for race/ethnicity, language, and sexual orientation and gender identity (SOGI) data with Covered California’s proposed 2017 qualified health plan standards. The Assembly had approved $200,000 GF and trailer bill language to accomplish this task. Health Access will continue to pursue this goal is other venues.

Aged & Disabled Eligibility Level Increase: The Conference Committee also declined to increase the amount of income that is disregarded in calculating eligibility for the Medi-Cal aged and disabled (A&D) program. When the A&D program was enacted in 2000, it had an income eligibility standard of 199% federal poverty level (FPL) plus income disregards, making the eligibility criteria equivalent to 133% of the FPL. However, the disregards lose real value every year, with the resulting income standard today at only 123% of the FPL. The Assembly previously allocated $30M GF to increase the eligibility level.

Health and community advocates will continue to pursue the restoration of Medi-Cal rates and benefits, and the #Health4All expansion of Medi-Cal to all adults regardless of immigration status, even if they are not included in either legislative body’s budget. Thanks to actions taken in last year’s budget, all California kids became eligible for full-scope Medi-Cal this month. The work to expand Medi-Cal to cover adults regardless of immigration status, continues in Senator Lara’s SB 1418. Those Californians currently enrolled in Medi-Cal coverage continue to experience the cuts made during the Great Recession to Medi-Cal rates and benefits, which need to be restored. This includes less access to doctors due to a 10% cut to provide reimbursement rates. We are pleased the budget restores acupuncture services, a number of other non-federally mandated benefits, including full adult dental ($98M), audiology ($2.4M), chiropractic ($3M), incontinence creams & washes ($5.6M), optician/optical labs ($5.9M), podiatry ($13.5M), optician/optical lab ($5.9M), and speech therapy ($160K), were also eliminated during the Great Recession and have not been restored. Adult dental benefits were partially restored in the 2013-14 budget, but still left uncovered are gum treatments, rear root canals, and partial dentures.

NEXT STEPS: The Senate and Assembly Budget Committees plan to hold hearings on the budget deal early next week, and the Legislature is expected to pass the budget by June 15.