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Health Programs Face Significant Cuts Under Brown’s Budget Plan

On Thursday, Gov. Jerry Brown (D) released his budget proposal for the 2012-2013 fiscal year, the San Francisco Chronicle reports.

The $92.6 billion spending proposal includes deep cuts to health and human services programs (Buchanan/Lagos, San Francisco Chronicle, 1/6).

The administration's Department of Finance estimated that California will face a $9.2 billion shortfall in the next fiscal year. The Legislative Analyst's Office had projected the state would face a nearly $13 billion deficit (Miller, Riverside Press-Enterprise, 1/5).

Brown initially planned to release the proposal next week. However, the plan accidentally was posted online by a member of Brown's staff, leading the governor to present it early.

Details of Health-Related Cuts

The budget plan proposes cutting:

  • $946.2 million from CalWORKs -- the state's welfare-to-work program -- by limiting the amount of time most adults could be on the program from four years to two years (San Francisco Chronicle, 1/6);
  • $842.3 million from Medi-Cal -- California's Medicaid program -- by merging services for beneficiaries eligible for both Medi-Cal and Medicare;
  • $163.8 million from In-Home Supportive Services -- which provides services for the elderly and people who are blind or have disabilities -- by eliminating domestic assistance for beneficiaries in shared living environments (AP/Palm Springs Desert Sun, 1/5); and
  • $64 million from moving children out of Healthy Families, California's Children's Health Insurance Program (York/Riccardi, Los Angeles Times, 1/6).

Healthy Families beneficiaries would be moved to Medi-Cal, according to the budget proposal and a California Medical Association analysis (Riccardi, "PolitiCal," Los Angeles Times, 1/5).

In addition to shifting dual eligibles into managed care plans, the governor's plan calls for reducing Medi-Cal spending by cutting payment rates to laboratories and other medical service providers by $75 million and trimming payments to community clinics by $28.8 million (San Francisco Chronicle, 1/6).

Brown wants state lawmakers to approve the major budget cuts by March 1 (San Francisco Chronicle, 1/6).

Possible Trigger Cuts

Brown also aims to address the state's projected budget gap by seeking voter approval for a temporary half-cent sales tax increase and higher taxes on the wealthy (Los Angeles Times, 1/6). If voters do not approve the governor's November ballot measure to raise taxes, the state would impose $5.4 billion in automatic cuts to schools, courts and public safety programs (AP/Palm Springs Desert Sun, 1/5).

Reaction

Democratic lawmakers already have said they do not want to approve significant cuts before May, when they expect to have a clearer picture of state revenue levels. Senate President Pro Tempore Darrell Steinberg (D-Sacramento) said, "We have done significant damage to the services for those in most need in California in the past several years, and we are not going to do any more unless it's absolutely necessary" (Los Angeles Times, 1/6).

Assembly Speaker John Perez (D-Los Angeles) said Brown's proposal "underscores the need for new revenues to avoid cuts that will be a major drag on the [economic] recovery" (Vara, Wall Street Journal, 1/6).

Meanwhile, Republican lawmakers said Brown purposefully targeted popular state programs as a way to alarm voters to approve higher tax rates (Los Angeles Times, 1/6). Assembly member Jim Nielsen (R-Gerber), vice chair of the Assembly Budget Committee, criticized Brown for failing to impose spending limits, adding, "The last thing we want to do is stomp on California's recovering economy by raising taxes" (Lin, AP/San Jose Mercury News, 1/6).

Anthony Wright, executive director of Health Access, said the cuts to health and human services programs would negatively affect access to care for Californians who have disabilities (Yamamura, Sacramento Bee, 1/6).

In a statement, state Treasurer Bill Lockyer (D) said the governor's budget proposal is "an honest, balanced and prudent plan" (Shaw, Sacramento Business Journal, 1/5).

Broadcast Coverage

On Thursday, Capital Public Radio's "KXJZ News" reported on the governor's plan to reduce spending on Medi-Cal, CalWORKs and other human services programs (O'Mara, "KXJZ News," Capital Public Radio, 1/5).

On Thursday, NBC's "Nightly News" reported on Brown's FY 2012-2013 budget proposal (Williams, "Nightly News," NBC, 1/5).

For additional coverage of reaction to Brown's budget proposal, see today's Capitol Desk post.

This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
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