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Lawmakers Pass Budget Riddled with Cuts to Safety Net Programs
After more than 75 hearings on issues related to healthcare, education, public safety, and other core state services, lawmakers in both chambers passed a $92.1 billion budget that addresses the state’s $15.7 billion revenue shortfall by instituting $8 billion in cuts and program changes, $5.93 billion in new revenues (dependent on passage of the Governor’s ballot initiative), $2.3 billion in other budget measures and puts $544 million in the state’s reserves. The proposal reduces the amount of cuts originally identified by Governor Brown in his May Revise. Some of the approved cuts and program changes outlined in the budget passed by legislators are included below.
Health
Program Cuts & Changes
- Coordinated Care Initiative: Scales back the integration of care for Medi-Cal and Medicare beneficiaries proposed by the Governor [$611 million reduction in Medi-Cal General Fund (GF) expenditures].
- Expansion of Managed Care: Approves the proposal to expand Medi-Cal managed care to all 28 fee-for-service counties ($2.7 million in GF savings).
- Medi-Cal Copayments for Beneficiaries: Approves implementation of $15 copayment for non-emergency visits to the emergency room by Medi-Cal beneficiaries and $3.10 copayment for approved drugs and $5 copayment for non-preferred drugs ($20.2 million in GF savings).
- Reduces and redirects funding for hospitals by $387.4 million.
- Healthy Families to Medi-Cal Transition: Approves transition of children up to 133% FPL in Healthy Families into the Medi-Cal program (see next article for details).
Rejects
- Rejects proposal to reduce Healthy Families provider rates by 25.7%.
- Rejects the proposal to reform the payment system for Federally Qualified Health Centers.
- Rejects the proposed increase in cost sharing for AIDS Drug Assistance Program (ADAP) clients and requires the Department of Health Care Services to create a stakeholder process for ensuring the smooth transition of ADAP clients into local low-income health programs.
Other
- Office of Health Equity: Approves the creation of the Office of Health Equity within the Department of Public Health focused on addressing health disparities in the state.
- Increases provider rate reimbursements to 100% of the Medicare rate for specific services starting January 1, 2013 as required by the Affordable Care Act.
Human Services
Cuts
- Maintains the 3.6% across the board cut in IHSS hours approved in February 2011 ($58.9 million in GF savings).
Rejects
- Rejects the Governor’s proposal to restructure CalWORKs that would have reduced aid for hundreds of thousands low-income children and families. Governor Brown has indicated that he will continue to negotiate with lawmakers to restructure and identify savings in the CalWORKs program.
- Rejects proposals to limit in-home supportive services (IHSS) and hours for seniors and people with disabilities.
Revenue & Other Solutions
- Extends the sunset date for the Gross Premium Tax on Medi-Cal managed care plans for two years ($183 million in GF savings).
- Assumes increased revenues from voter passage of the Schools and Local Public Safety Protection Act ($5.93 billion in new revenues). Read more about the Schools and Public Safety Act in the April Health Matters.
The Governor has until June 27th to sign the main budget bill (AB 1464). Your advocacy is critical to ensure that children in our state continue to have access to quality, affordable health coverage options. Contact CHC Policy Director Sonya Vasquez for more information.
Lawmakers & Governor Grapple with Future of Healthy Families Program
The budget approved by lawmakers last week included the transition of children up to 133% FPL in Healthy Families into the Medi-Cal program. In his January budget and his May Revise budget, Governor Brown proposed moving all 875,000 children in the Healthy Families program into the Medi-Cal program starting in October 2012 through June 2013.
As a result of concerns raised by advocates and providers across the state, Senate and Assembly lawmakers voted to support the transition for children up to 133% FPL given that these children would have to transition to Medi-Cal when the majority of provisions in the Affordable Care Act take effect in 2014. The proposal requires the Department of Health Care Services (DHCS) to provide the legislature with a transition plan for children moving in Phase 2 and 3 prior to transitioning children in those phases and requires DHCS to provide dental care to children impacted by the transition through the Medi-Cal fee-for-service system. Sacramento would continue to provide dental care through managed care plans and Los Angeles would give beneficiaries the choice of accessing care through the managed care or fee-for-service systems.
Lawmakers believe only a partial transition of children would allow the state to monitor how children’s access to care is impacted by the shift as well as ensure the least disruptions in care for beneficiaries. CHC and our Covering Kids & Families and LA Access to Health Coverage coalitions developed a number of recommendations regarding the proposed transition. To view CHC’s recommendations, visit Comments on Transitioning Children from Healthy Families to Medi-Cal.
Contact the Department of Health Care Services, the Governor, and your lawmakers today and urge them to incorporate our partners’ recommendations into the Healthy Families to Medi-Cal transition plan. For more information, contact CHC Policy Analyst Fatima Morales.
Health Benefit Exchange
The California Health Benefit Exchange Board continues to advance its work at lightning speed to be ready to enroll millions of Californians into coverage on January 1, 2014. On June 12th, the Board met in Sacramento to discuss the Small Business Health Options Program (SHOP) exchange, outreach and education, the assisters program, and the Exchange’s Level I grant application to the federal government.
PricewaterhouseCoopers provided an overview of their recommendations for the SHOP exchange in California, which were amended to include comments from stakeholders across the state. Among the recommendations outlined by PricewaterhouseCoopers were:
- The SHOP and Individual Exchanges should be partially aligned such that health plans offering coverage in the individual exchange should also offer coverage in the SHOP. However, the Exchange would have the power to grant exceptions for plans that only wish to participate in one exchange.
- SHOP and Individual Exchange benefits should be partially aligned so that benefit plan offerings in both exchanges are consistent. Some differences may be allowed to account for varying needs among individuals and small group enrollees.
- Employees should be provided maximum choice such that employers determine the maximum contribution they will make on behalf of employees and employees then select their health plan and coverage level.
Ogilvy & Mather and Richard Heath & Associates (RHA), consulting firms contracted by the Exchange, Department of Health Care Services, and Managed Risk Medical Insurance Board to conduct research on marketing, outreach and the assisters program for the three agencies, provided updates on the options being considered by the Exchange Board and staff. The Exchange received over 45 comment letters from stakeholders across the state providing various recommendations. Read CHC’s outreach and education recommendations to the Exchange. Ogilvy will work with Exchange staff to finalize staff recommendations on the outreach and education program. During the June 19th meeting, the Board voted to approve the highest level of funding for outreach and education and increased the amount available for the grant program to $20 million per year for 2013 and 2014.
 RHA gave an overview of comments provided by stakeholders along with staff recommendations on the assisters program. Overall, stakeholder comments were positive and supportive of the options laid out by RHA. Advocates did express concern over the Navigator pay-for-enrollment option supported by Exchange staff and the $58 per successful application fee. Groups felt the fee might be too low. Because of comments regarding the exclusion of community clinics as eligible Navigator entities, Exchange staff recommended that clinics be included as potential Navigator entities. CHC also provided comments on the assisters' program. For more details on our recommendations, read our policy brief Bridging the Divide: Designing the Navigator System in California.
Exchange staff also reported legal concerns about the ability of Navigators to enroll individuals into Medi-Cal and Healthy Families given Proposition 26. Proposition 26, passed in 2010, requires that “fees collected from an entity be spent only in ways that have a direct and proportional benefit to the entity paying the fee.” With some of the funding for Navigator grants potentially expected to come from health plan assessments, paying Navigators for enrollment of individuals into public programs may violate Prop. 26 in that some plans would not see a direct and proportional benefit for paying the fee. Therefore, the Exchange is considering a policy that would only compensate Navigators for enrollment of individuals into qualified health plans. During the June 19th meeting, the Board expressed support for RHA’s recommendations regarding the assisters program in California.
The Board also discussed plans to submit a revised Level I grant (referred to as the Level 1.2 grant) to the US Health and Human Services Department to provide funding for Exchange implementation activities through June 30, 2013. The Level 1.2 grant request is estimated at $188 million and is due June 2012.
The Exchange Board examined options for an Exchange customer service center at its June 19th meeting. Presenters from Maximus, Kaiser Permanente, and a representative from San Bernardino County provided information about current customer service center operations run by different entities to support enrollment into health programs. The Board, MRMIB, the Exchange, and DHCS staff will continue to discuss options for CA’s customer service center at upcoming meetings. More information and details on how to submit comments are available on the Exchange Board website. Comments must be submitted by June 27th. Contact CHC Policy Analyst Fatima Morales for further information.
Healthy Way Los Angeles’ Auto-enrollment of GR Beneficiaries & Transition of Ryan White Patients
Los Angeles County expanded access to care for families and individuals under the Healthy Way Los Angeles (HWLA) program starting last year. HWLA provides access to comprehensive medical coverage for families and individuals 19 to 64 years of age with incomes under 133% of the federal poverty level ($30,657 for a family of 4). Over 135,973 individuals are currently enrolled.
On June 1st, the Department of Health Services (DHS) started automatically enrolling General Relief (GR) recipients into HWLA. The Department estimates that up to 100,000 general relief recipients may be eligible for the program. GR recipients who enrolled into the program and are assigned to a medical home based on prior utilization data will receive notice of their enrollment by mail and phone. Beneficiaries will receive a welcome letter that includes their medical home assignment and instructions on how to access services and change their medical home. Beneficiaries DHS is unable to assign will be contacted by mail and phone and will receive a letter providing instructions for how to choose a medical home.
Recent discussions by the county to reduce the number of individuals receiving general relief has sparked concern among advocates that cuts to GR will deter maximum auto-enrollment of GR recipients into HWLA. Advocates note that by eliminating GR support, the county will not only drive individuals further into poverty but may miss the opportunity to enroll them into HWLA given that auto-enrollment plan is tied to receipt of GR benefits. The county budget has yet to be finalized.
Starting on July 1st, the Department will also begin screening and enrolling Ryan White and AIDS Drug Assistance Program (ADAP) beneficiaries into HWLA at time of application or recertification. DHS is training over 100 certified ADAP enrollment workers to help enroll patients into the program. Ryan White/ ADAP beneficiaries transitioning into HWLA will be allowed to keep their existing HIV provider and HIV clinic as their HWLA provider and medical home to ensure continuity of care. DHS is also working with various departments and community partners to ensure access to pharmaceutical therapy is not affected by the transition. Ryan White and ADAP beneficiaries will continue to receive services under each program until their enrollment into HWLA is complete. For more information, contact CHC Policy Analyst Fatima Morales.
Some Insurers Embracing Some ACA Provisions
After United Healthcare announced on June 10th that they would uphold some of the insurance reforms and patient protections in the ACA regardless of the Supreme Court’s decision, Aetna and Humana were quick to follow suit. The three insurers will continue to offer no lifetime limits, free preventive care, and allow children to stay on their parent’s plan until age 26. The provision that keeps insurers from revoking coverage from expensive patients is also safe. Other provisions, like the 80/20 rule that requires insurers to pay out 80% of their revenues and allowing people with pre-existing conditions to sign up for insurance, would not survive a full strike down of the law. The Blue Cross Blue Shield Association, Cigna, and WellPoint will not make any decisions until after the ruling, making clear that many consumer protections are still not safe if the law is struck down. For more information, contact CHC Policy Analyst Rad Cunningham.
Sugary Drinks Summit
 The Center for Science in the Public Interest (CSPI), in collaboration with other organizations including the California Center for Public Health Advocacy (CCPHA), sponsored the first ever National Sugary Drinks Summit in Washington DC on June 7-8th. The conference brought together a diverse group of public health officials, students, community health advocates, and local, state and national elected officials to discuss strategies for strengthening the growing movement towards reducing the consumption of sugar-sweetened beverages throughout the US.
Speakers highlighted the public sector’s responsibility to develop policies that effectively address our country’s obesity epidemic. Philadelphia Mayor Mayor Nutter spoke about his fight against the beverage industry while leading Philadelphia’s pioneering attempt to impose a tax on sugar-sweetened beverages. Congresswoman Rosa L. DeLauro (D-CT) talked about her role in protecting the health and safety of food in the US as a member of the Agriculture-FDA appropriations subcommittee. Congresswoman DeLauro recommended that states advocate for policies that require soft-drink manufacturers to place “surgeon general” labels on their packaging similar to those on tobacco products to inform the public of the numerous negative health impacts associated with soft-drink consumption. If you’d like to learn more or join the challenge to decrease sugary drinks consumption, visit the Life’s Sweeter with Fewer Sugary Drinks campaign or contact CHC Policy Analyst Breanna Morrison.
Let’s Get Healthy California
Governor Brown issued Executive Order B-19-12 that led to the creation of the star studded Let’s Get Healthy California task force. The task force had its first meeting on June 11th in Los Angeles and plans to publish a report by December 15th detailing a ten-year plan to improve the health of all Californians. The task force’s goals are to identify cost-effective best practices to reduce diabetes, asthma, and hypertension while lowering 30-day hospital readmissions, increasing childhood vaccination, and advancing health equity. Co-chairs are Diana S. Dooley and Don Berwick, former head of CMS, and members include notable economists, academics, CEO’s of major healthcare plans, state senators and assembly members. The full press release and list of members is available on the California Health and Human Services website. For more information, contact CHC Policy Analyst Rad Cunningham.
Place Matters for Communities Surrounding the Baldwin Hills Oil Field
More Californians are learning that hydraulic fracturing, a controversial and unregulated oil and gas recovery process, is taking place under the places where they live, work, and play. No regulations currently exist in California that specifically address fracking, a process to recover hard-to-reach deposits of oil and gas by fracturing rock formations through a highly pressurized combination of water, sand, and chemicals. Across the nation, fracking has raised concerns about its links to contaminated groundwater, greenhouse gas emissions, earthquakes, and adverse health impacts. In South LA, residents surrounding the Baldwin Hills Oil Field, one of the largest urban oil fields in the nation, learned that the oil company in charge of the field (Plains Exploration & Production) has been using various forms of fracking over the years. PXP is finalizing a study to determine the feasibility of doing more fracking in the field.
The Greater Baldwin Hills Alliance (GBHA), a collaborative project of CHC, the Natural Resources Defense Council, and the City Project, has been at the forefront of advocacy and communication with government decision  makers over the last 5 years. The GBHA recently met with community residents to inform the development of policy recommendations to be presented at a “listening workshop” in Culver City organized by the Department of Conservation to scope prospective fracking regulations. A week later on June 12, a crowd of over 400 community residents packed the Culver City Council Chambers to decry the lack of transparency and regulation of fracking in California. They called on the Department of Oil, Gas, and Geothermal Resources to create safeguards to avoid adverse impacts from the little studied, yet industry-wide accepted practice. Alongside hundreds of advocates, the GBHA and CHC called on the state to place a moratorium on fracking until comprehensive regulations are developed and will submit extensive recommendations to the Department this summer.
Shortly after the meeting in Culver City, State Assemblymember Betsy Butler introduced AB974 with Assemblymember Holly J. Mitchell as a co-author. The bill aims to enact a moratorium on hydraulic fracturing until regulations governing the practice are adopted.
If you are concerned about the environments in which we live, work, and play and would like to comment on the regulations needed to insure that our neighborhoods are not hazardous to our health, email comments to California Conservation. Please contact CHC Community Liaison Mark Glassock for more information on how to get involved with the Greater Baldwin Hills Alliance.
Ujima Village
Ujima Village is a former residence and current park that was built over a tank farm operated by Exxon Mobile. Environmental reports and human health assessments, conducted by an Exxon contractor, have revealed the presence of volatile organic compounds (VOC) in excess of California State regulations but concluded no health risks are associated with park use.
The Los Angeles County Board of Supervisors approved a motion by Supervisor Mark Ridley-Thomas to make three significant changes to this environmental justice issue at Ujima Village:
- Transfer the authority to oversee the environmental investigation from the Water Board to the Department of Toxic Substance Control, who had been a collaborator up to this point.
- Order the Department of Public Health to conduct a human health assessment as it relates to past exposure. So far the health assessments have only assessed future risk from exposure.
- Allocate funds to relocate Honey’s Little Angels Daycare center from the Ujima site to 8300 S. Vermont, where the non-profit daycare will operate rent free in a city-owned building.
These changes will protect children who use the daycare, bring more expertise to the toxicological and public health issues involved, and resolve some of the conflict of interest inherent in assessments performed by Exxon consultants. For more information, contact CHC Policy Analyst Rad Cunningham.
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