Governor Brown Signs Budget Package To Close State Deficit
The governor also used his line-item veto authority to cut $270 million in state spending, primarily from transportation projects (Goldmacher, Los Angeles Times, 7/1).
Brown said in a statement that the spending package was "an honest but painful budget that returns California's general fund spending to levels unseen since the 1970s" (Harmon, San Jose Mercury News, 6/30).
In February, the state faced a projected deficit of about $26.6 billion. Over the past several months, Brown and state legislators have taken steps to close the deficit by passing spending cuts and other budget measures.
Last week, Democratic lawmakers used a simple majority vote to pass budget legislation that closed the state's remaining deficit. The newly passed budget plan assumes that the state will receive about $11.8 billion in stronger-than-expected tax revenue (Yamamura, "Capitol Alert," Sacramento Bee, 6/30).
The $85.9 billion general fund budget includes several changes that will affect health and human services programs. For example, the budget aims to reduce state spending by:
- $623 million by cutting health care providers' reimbursements for Medi-Cal -- California's Medicaid program -- by 10%;
- $582 million over two years by implementing cost-containment procedures for programs that serve people with developmental disabilities;
- $511 million by requiring Medi-Cal beneficiaries to pay $5 copayments for physician visits and $50 copays for emergency department visits;
- $246 million by enacting cuts to the state's prison health care budget;
- $178 million by reducing SSI/SSP grants to low-income seniors and residents with disabilities;
- $140 million by installing drug-dispensing machines in the homes of In-Home Supportive Services beneficiaries;
- $67 million by requiring IHSS beneficiaries to obtain medical certification stating that they need in-home care;
- $41 million by imposing a soft cap of seven physician visits annually and placing a dollar limit on hearing aids for Medi-Cal beneficiaries;
- $23 million by imposing rate increases for beneficiaries of Healthy Families -- California's Children's Health Insurance Program -- who have annual incomes that are between 150% and 250% of the federal poverty level; and
- $5 million by requiring Healthy Families beneficiaries to pay higher copays for ED visits and inpatient care.
The new budget also:
- Takes $861 million from county mental health programs and applies the funds toward state mental health costs; and
- Assumes the state will receive $128 million in additional federal funds for IHSS (Sacramento Bee, 7/1).
If California's tax revenue falls short of expectations, the budget plan will trigger additional cuts to health programs and other state services (Los Angeles Times, 7/1).
Brown and Democratic legislators have promised to push for a 2012 ballot initiative that would ask voters to reinstate higher tax rates that expired last week ("Capitol Alert," Sacramento Bee, 6/30).
For additional coverage on how the newly passed budget plan could affect California's adult day health care services, see today's Capitol Desk post.
Headlines and links to broadcast coverage of Brown's approval of the budget are provided below.
- "Brown Signs California Budget" (Adler, "KXJZ News," Capital Public Radio, 6/30).
- "New Budget Includes Drop in Sales Tax" (Shuler, "The California Report," KQED, 6/30).
- "Brown Signs California Budget" (Small, "KPCC News," KPCC, 6/30).