A budget report from our policy advocate Myriam Valdez:
Over the last week, the Budget Conference Committee met to begin resolving differences between the Senate and Assembly’s versions of the state budget. The committee is tackling issues including cap and trade, poverty alleviation, education. child care, and health care. In the meantime, the “Big Three”– the ProTem, Speaker and Governor — are meeting to finalize the state budget before the June 15th state constitutional deadline for the Legislature to pass a budget bill.
On Saturday, the Conference Committee heard budget proposals for health and human services related issues, including proposals from Health Access and other consumer advocates, to use Proposition 56’s Medi-Cal monies to restore dental and other benefits, expand the Medi-Cal program to cover all young adults up the the age of 26, regardless of immigration status, and other critical investments aimed at improving California’s Medi-Cal program. Health Access was one of the organizational supporters of Proposition 56, helped to draft the initiative, and actively campaigned for the measure. Proposition 56 dedicates almost $1.3 billion in revenues generated by the tobacco tax to Medi-Cal, and allows for broad use to of the monies to increase funding for Medi-Cal programs, treatment, and services, which includes new investments in Medi-Cal eligibility, benefits, and provider rates.
One of the key issues facing the Legislature and the Governor both in Conference Committee and as negotiations continue this week is whether the Proposition 56 dollars will be used to broadly fund Medi-Cal, or whether it will be used to expand access to the Medi-Cal program by investing in targeted, increased provider rate reimbursements where access to the Medi-Cal program is most great, restoring critical Medi-Cal benefits cut almost a decade ago during the Great Recession, or expanding coverage to undocumented young adults up to the age of 26. Each of these proposals was included as part of Health Access’ Proposition 56 Medi-Cal spending proposal to the Legislature, along with other key budget priorities, which are described in our 2017 Budget Scorecard.
Health Access strongly supports using the $1.3 billion in Medi-Cal dollars from Proposition 56 revenues to improve the program by expanding eligibility and coverage, restoring benefits that had previously been cut, increasing reimbursement rates for FamilyPACT and dental providers, and making targeted, data-driven increases in other provider reimbursements.
The Assembly and Senate Budget Proposals include significant elements of Health Access’ proposal. The Budget Conference Committee held these issues open pending negotiations between the Governor, President Pro Tem of the Senate, and the Speaker of the Assembly.
Key Conference Items for Consideration by the Governor and the Differences Between the Senate and Assembly proposals:
#Health4All Young Adults, up to the age of 26
Both houses fund #Health4All Young Adults, but at different levels, with the Assembly allocating $54 million to implement the program starting July 1st, 2017, and the Senate delaying implementation to July 1, 2018, and funding the program at $63.1 million in the first year, and $85.8 million ongoing.
#Health4All Young Adults is a top priority for Health Access California, the California Immigrant Policy Center, and many other consumer, health, immigrant, and community organizations. At the heart of implementing President Obama’s Affordable Care Act’s (ACA) was the Medicaid expansion (Medi-Cal in California), helping to insure that Californians have access to health care, including our most vulnerable and, in California, the undocumented. Prior to the ACA, young adults had the highest rates of uninsurance of any age group. The ACA does allow most young adults to stay on their parents’ coverage until age 26– an option many undocumented youth do not have because of their parents’ lack of employer coverage.
In the midst of a hostile federal environment, where immigrants are experiencing fear and anti-immigrant actions, ensuring California’s young people maintain health coverage upholds California’s commitment to the health and well-being of our immigrant communities.
As Senator Lara said in committee – the Medi-Cal expansion was intended to help expand healthcare for all of California’s children – and when it comes to undocumented children – these are also California’s children. We hope that the Governor and Legislative leaders continue to protect health care for all of California’s young adult population as well, regardless of immigration status.
Improving Medi-Cal Provider Rates
The two houses approach Medi-Cal provider rates differently. The Senate package focuses provider rate investments in a targeted, data-driven manner through a High Need Specialty Pool (HSNP), resulting in a gradual increase in funding from $350 million to $700 million between 2017-18 and 2020-21. The HSNP would provide ongoing funding for provider rate reimbursements in demonstrated areas of high need, where lack of access to Medi-Cal providers is greatest. Also in the Senate Package, dental reimbursements were funded by $130 million (discussed further below).
The Assembly Proposition 56 spending plan focuses provider reimbursements on across-the-board incentive-based payments for physicians and dental providers, with no requirement for investing in areas of demonstrated high need, as the Senate proposal requires.
FamilyPACT: Both houses propose $50 million in funding for family planning, including Planned Parenthood.
Dental Provider Rates Although the state has eliminated the 10% rate reduction and the retroactive recoupment of the AB 97 rates for dental providers, there is evidence that the rates remain insufficient to ensure access. According to the State Auditor, California’s provider reimbursement rates for the 10 most common dental procedures was only 35% of the national average in 2011, and children’s utilization of dental services was the 12th worst in the nation. Furthermore, the audit revealed extreme access issues because of low reimbursement rates for dental providers, with over 50% of children going without dental care for more than 12 months.
The Senate Prop. 56 Investment proposal includes $130 million annually for dental provider reimbursements, while the Assembly includes $247 million annually for incentive based dental reimbursments.
Optional Benefits The Assembly Proposition 56 Spending Package does not include restoring the “optional” Medi-Cal benefits, which include audiology, chiropractic, incontinence creams and washes, optician/optical labs, podiatry, vision, and speech therapy. Adult dental coverage was partially restored in 2013, but some dental services like partial dentures are still not covered by Medi-Cal.
Instead of using Proposition 56 dollars for the restoration of optional benefits, the Assembly funds the restoration through General Fund dollars. The Senate restores the optional benefits, including full adult dental, as part of its Proposition 56 spending package, by $52 million in the first year, and $105 million ongoing per year thereafter.
Other Non-Prop. 56 Investments
Diabetes Prevention Program
The Assembly approved $5 Million in annual funding for a pilot program to provide Medi-Cal coverage for the Diabetes Prevention Program, an evidence-based intervention covered by Medicare and certified by the Centers for Disease Control & Prevention (CDC). The Senate allocated no funding for this proposal.
Medi-Cal Aged & Disabled Program
The Assembly approved $30 Million in General Fund to bring the program’s income eligibility requirements into alignment with the state’s Optional Expansion of Medi-Cal. The Senate had no proposal. In dialogue with Chair Senator Holly Mitchell, the LAO urged consideration of this item, pointing out this is the only adult population where eligibility is limited to below 138% of poverty, and there is no policy basis for the differential.
What’s next: The Budget Conference Committee will reconvene to take action on budget items as final decisions are made by the “Big 3.” The Legislature must pass the budget by midnight on June 15th. Stay tuned to our blog and Twitter for updates on #CABudget as they happen.