Brown’s Budget Proposal Would Allocate $670M to Medi-Cal

Gov. Jerry Brown's (D) fiscal year 2014-2015 budget proposal would allocate $670 million to expand Medi-Cal and would prevent health care providers in the state from having to repay a 10% retroactive cut in the program's reimbursements, the Los Angeles Times reports.

Medi-Cal is California's Medicaid program (Megerian/York, Los Angeles Times, 1/8).

Overview of the Budget Plan

The proposal is scheduled to be released Friday but was leaked to the media on Wednesday.

Overall, the proposal would seek a 5% increase in spending from FY 2013-2014.

The $154.9 billion spending plan would include:

• $106.8 billion in general fund spending (Siders et al., Sacramento Bee, 1/8);
• $11 billion to repay state debts; and
• $1.6 billion to create a discretionary "rainy day" fund (Los Angeles Times, 1/8).

Additional Funding for Health-Related Services, Programs

The budget proposal would include $670 million to expand existing Medi-Cal benefits. Such benefits include:

• Dental services;
• Mental health services;
• Nutrition services; and
• Substance misuse services.

In addition, California's In-Home Supportive Services would receive a 6.4% increase in funding under the plan, bringing its general fund share to about $2 billion (Sacramento Bee, 1/8).

Relieving Retroactive Medi-Cal Cuts

Brown's proposal also would keep Medi-Cal providers from having to repay the state for a 10% reimbursement rate cut that is retroactive to 2011 (Bartolone, "KXJZ News," Capital Public Radio, 1/8).

In October 2011, CMS approved the state's plan to reduce certain Medi-Cal payments by 10%.

In December 2012, a three-judge panel of the 9th U.S. Circuit Court of Appeals overturned a district court ruling to stop the retroactive 10% cut. Health care providers asked the full 9th Circuit court to review the case. In May 2013, the full circuit court upheld the cut.

In September 2013, the California Medical Association petitioned the U.S. Supreme Court to review the federal court ruling (California Healthline, 10/23/13).

Under Brown's budget plan, physicians and other health care providers would not be exempt from the cut in future Medi-Cal reimbursements ("KXJZ News," Capital Public Radio, 1/8).  

Reaction

In an email, Assembly Speaker John Pérez (D-Los Angeles) said he was "pleased to see so many areas of agreement between the governor and the Assembly."

However, Anthony Wright -- executive director of Health Access California -- said the proposal does not adequately address important health issues that were affected during the recession. He said, "This is a budget that really continues the cuts we made in the depths of the recession, and that's disappointing," adding, "We think there needs to be some targeted restoration of the worst of the cuts that were made over the last many years" (Sacramento Bee, 1/8).

Budget Addresses Drinking Water Issues

Meanwhile, Brown's proposal also would have the State Water Resources Control Board assume control of the state's Safe Drinking Water Program from the California Department of Public Health.

According to "KXJZ News," the decision came after DHS failed to spend nearly $500 million related to brining safe drinking water on communities in need.

Under the proposal, about $200 million and 300 positions would be transferred to SWRCB (Quinton, "KXJZ News," Capital Public Radio, 1/8).