Legislature Passes Final Budget; Schwarzenegger Agrees To Sign

On Friday, California legislators voted to approve a budget plan that will increase state spending but still include cuts to health care, education and other programs, the Los Angeles Times reports.

Gov. Arnold Schwarzenegger (R) said he would sign the package after lawmakers agreed to place new restrictions on a state reserve fund and increase state tax penalties for corporations instead of increasing the state personal income tax withheld from individuals' paychecks (Rau, Los Angeles Times, 9/20).

Health care advocates are critical of the stronger protections on the reserve fund, arguing that the restrictions could prompt further funding cuts in programs that affect low-income families, seniors and people with disabilities (Lin, AP/San Francisco Chronicle, 9/20).

Health Care Provisions

Under the budget, the 10% cut to Medi-Cal provider payments would be in effect until March 1, 2009, when smaller payment cuts would take effect.  Medi-Cal is California's Medicaid program (Fernandez, San Francisco Chronicle, 9/20).

In addition, a provision included in the budget package would require children enrolled in Medi-Cal to verify their eligibility every six months, rather than once a year.  Children with disabilities and pregnant teenagers would be exempt from the requirement (Sanders, Sacramento Bee, 9/21).

Premiums for Healthy Families -- California's version of the State Children's Health Insurance Program -- will increase under the plan (Schultz, Fresno Bee, 9/19).

Next Steps

The governor is expected to sign the budget early this week after reviewing appropriations and deciding which provisions he will eliminate with his line item veto.