State Budget Preview: Key Investments Still Needed

The annual state budget process, which began in January, comes into focus later this week when the Governor releases the May Revision of his proposed 2015-16 budget. Health and community advocates are urging the Governor and the Legislature to include funding for critical health programs in upcoming budget negotiations. These investments continue the Affordable Care Act’s momentum by removing barriers to coverage, ensuring those covered in Medi-Cal get access to care along with important benefits, and extending coverage to the remaining uninsured.

The deadline for the Legislature to pass and the Governor to sign a budget is June 15. The Governor’s May Revision sets the stage for a short month of negotiations, shaped by information about how much of a surplus is available given the state revenues that came in during April tax time, and constitutional formulas that limit the use of these funds.

Recent Budget Subcommittee Hearings: Since introducing the budget in January, the legislature’s budget subcommittees have reviewed the Governor’s proposed budget along with budget requests from advocates. In recent days, the Senate and Assembly Budget Subcommittees on Health and Human Services completed their reviews of the Governor’s proposed budget, along with a range of urgent and needed health investments that were not included in the Governor’s proposed budget, from expanding coverage without regard to immigration status to limiting estate recovery in Medi-Cal to restoring Medi-Cal benefits. The subcommittees left most of these items open for further discussions pending the May Revision. Many consumer and community organizations including Health Access California were on hand to strongly support these critical investments.

Immigrant Health Care. Although the Affordable Care Act made health coverage possible for millions of Californians, it excludes undocumented immigrants currently living and working in any state. If and when the President’s executive order on immigration is upheld in court, those newly eligible for deferred action will have access to Medi-Cal. Advocates are proposing to expand that access to all Californians income eligible for Medi-Cal, without regard for immigration status, as proposed in SB 4 (Lara). The cost would be a small fraction of last year’s proposal, amounting to only 2 more cents for every dollar spent on Medi-Cal, but would make a world of difference for not just immigrant families, but for our health system and society.

Estate Recovery. Advocates are also seeking that California limit Medi-Cal estate recovery to costs associated with long term care services and supports, consistent with minimum federal requirements. Last year, the Governor vetoed a bill to limit Medi-Cal estate recovery, arguing the policy change should be considered in the budget instead. Health Access will continue to vigorously advocate for this policy change so that older low-income Californians don’t have to make a trade-off between seeking health care coverage and keeping their family home.

Restore Medi-Cal Benefits Eliminated in the 2009-10 Budget. Major cuts were made during the budget crisis that have yet to be restored, including Medi-Cal rates and benefits, and consumer advocates including Health Access request undoing those cuts. In this part week, the budget subcommittees heard a proposal to restore non-federally mandated yet critical Medi-Cal benefits that were eliminated for budgetary, not policy reasons, in response to the state fiscal crisis. They include, among other things: acupuncture, audiology, chiropractic, podiatry, speech therapy, and full restoration of adult dental coverage. Partial restoration of adult dental was done in the 2013-14 budget, which gives Medi-Cal beneficiaries access to preventative care, restorations, and full dentures. However, important services such as gum treatment and partial dentures or implants are still not covered in Medi-Cal. According to a recent study published in Health Affairs, California emergency departments experienced a spike in visits for dental issues after comprehensive dental benefits for adults were cut from Medi-Cal. The study further found that the lack of adult dental benefits shifts dental care needs to costly emergency departments where dental issues are not adequately addressed.

Medi-Cal Provider Rates. Many providers and consumer groups have sought to rescind the 10 percent Medi-Cal provider rate cut, which will encourage more providers to participate in Medi-Cal and help increase access for Medi-Cal beneficiaries. In fact, California’s Medi-Cal provider reimbursement rates are among the lowest in the nation, making access to doctors, specialists, and beneficiaries harder for some of the 12 million Californians with Medi-Cal coverage. 

What’s Next: The Governor is expected to release his May Revision of the budget later this week. The budget subcommittees will then hold hearings to review the May Revision the following week (May 18-22), and the Budget Conference Committee will convene at the end of the month to hash out differences between actions taken by the two houses. A final budget must be passed by June 15th. Stay tuned for updates!

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