Brown, Calif. Lawmakers Reach Budget Deal After Compromises

On Tuesday, California lawmakers and Gov. Jerry Brown (D) announced a $115.4 billion budget deal with several health care implications, the Los Angeles Times' "PolitiCal" reports (Mason, "PolitiCal," Los Angeles Times, 6/16).

The deal comes after the California Legislature on Monday passed its budget plan (AB 93) hours ahead of the deadline to do so.

The initial $117.5 billion general fund plan assumed that the state would get about $2.3 billion more in revenue than estimated in Brown's revised version of the fiscal year 2015-2016 budget plan, which was released in May (California Healthline, 6/16).

Details of Budget Deal

The budget deal announced Tuesday reflects the lower revenue estimates from the California Department of Finance that were used for Brown's initial proposal, increasing general fund spending by just $61 million (Calefati, Inside Bay Area, 6/16).

Overall, the budget allots nearly $32 billion for health care programs, including about $18 billion for Medi-Cal, the state's Medicaid program (AP/Sacramento Bee, 6/16).

According to "PolitiCal," state lawmakers likely will vote on the budget deal on Friday ("PolitiCal," Los Angeles Times, 6/16). Both the state Senate and Assembly are expected to approve the plan (Lin, "KPCC News," AP/KPCC, 6/16).

Plan Expands Medi-Cal to Undocumented Children

Under the budget deal, the state in May 2016 would begin extending Medi-Cal coverage to about 170,000 undocumented immigrant children under age 19. The expansion is projected to cost $40 million in the next fiscal year and about $132 million annually following implementation.

Democratic lawmakers originally sought to expand Medi-Cal coverage to all undocumented immigrants -- including adults -- and allow some to purchase coverage from Covered California, but state Sen. Ricardo Lara (D-Bell Gardens) said doing so would be a "multiyear effort."

California Senate President Pro Tempore Kevin de León (D-Los Angeles) said, "We are the first legislative body ... to invest children without legal status," adding, "With this budget, we're saying that immigrants matter, irrespective of who you are or where you're from" ("PolitiCal," Los Angeles Times, 6/16).

Brown Rejects Medi-Cal Rate Increase, Approves Cuts to Program

Brown rejected a provision in lawmakers' budget plan that would have increased Medi-Cal provider reimbursement rates by 5%, citing concerns about costs (Inside Bay Area, 6/16).

According to the AP/Bee, the Legislature's plan had called for $82 million to be used to start raising payments for physicians, dentists and other providers who participate in the program (AP/Sacramento Bee, 6/16).

Meanwhile, the budget deal includes a plan to make cuts to Medi-Cal to help fund state-supported childcare, the Sacramento Business Journal reports (Young, Sacramento Business Journal, 6/16).

Plan Would Restore Home Care Workers' Pay

The budget deal also includes $226 million to restore for one year a 7% pay cut In-Home Supportive Services providers (Robertson, Sacramento Business Journal, 6/17).

The restorations would go into effect on July 1, and future funding to restore the cuts would be reliant on the passage of a managed care tax.

Laphonza Butler -- president of the Service Employees International Union and SEIU-United Long-Term Care Workers, --  praised the budget for temporarily restoring cuts to IHSS payments. However, Butler said the "fight isn't over until every hour restored this year is restored for good" (SEIU release, 6/16).

Brown Announces Special Sessions

Meanwhile, Brown announced two special legislative sessions to address additional funding concerns related to the budget ("KPCC News," AP/KPCC, 6/16).

One of the sessions will be used to consider ways to increase Medi-Cal reimbursements (Orr, "KXJZ News," Capital Public Radio, 6/16). According to "KXJZ News," Brown is seeking at least $1.1 billion in permanent funding that would include money for rate increases.

According to "KXJZ News," the Medi-Cal special session, as well as the one for road and highway funding, both are likely to result in proposals for new taxes or fees (Adler, "KXJZ News," Capital Public Radio, 6/16).

Criticism of Budget

Despite the additional funding for certain health care programs, some stakeholders expressed concerns over the plan.

Michael Herald, an advocate at the Western Center on Law and Poverty, said the budget deal allots too little money for low-income residents. Herald said, "In a year in which the state is receiving enormous revenue increases, it is unimaginable that the budget would provide so little for those who have the greatest needs" (Inside Bay Area, 6/16).

Meanwhile, Assembly member Kristin Olsen (R-Modesto) said while Republicans are "very pleased that [Brown] held the Democrats to that lower, more conservative revenue projection ... the downside is he agreed to new, ongoing spending in the budget" (Adler, "KXJZ News," Capital Public Radio).