Schwarzenegger’s Revised FY 2004-2005 State Budget Proposal Expected To Call for Reduced Medi-Cal Spending
Gov. Arnold Schwarzenegger's (R) revised fiscal year 2004-2005 state budget proposal, which he will issue Thursday, is expected to call for reduced Medi-Cal spending to help address a projected $15 billion budget deficit, the Los Angeles Daily News reports (Drucker, Los Angeles Daily News, 5/12). Schwarzenegger's original $99.1 billion budget proposal would reduce state funding for health care programs by more than $900 million, with about $880 million in spending cuts to Medi-Cal, including a provider reimbursement rate cut of 10%. In addition, the proposal would cap enrollment in Healthy Families at its current level of about 732,000 and would increase monthly premiums from $9 to $15 per child for some Healthy Families beneficiaries (California Healthline, 5/12). H.D. Palmer, Schwarzenegger's chief budget spokesperson, said, "The governor is going to submit a revised budget that will continue to put California on a path toward structural balance" (Los Angeles Daily News, 5/12).
Health care advocates and legislative staff on Wednesday said that Schwarzenegger's proposed changes to Medi-Cal "will not be included" in the revised budget plan, the Sacramento Bee reports (Bluth/Benson, Sacramento Bee, 5/13). The Department of Health Services in January announced the launch of a yearlong effort to reform Medi-Cal, which covers about 6.8 million California residents. The effort is part of the fiscal year 2004-2005 budget that Schwarzenegger proposed earlier this year, under which Medi-Cal would offer different coverage plans, charge higher premiums to beneficiaries with higher incomes and eliminate optional benefits not required by the federal government. State officials said that they hope to submit to the Legislature a request for Medi-Cal reform that they would later forward to the federal government for approval. If approved, the state would begin to implement the reforms by 2005 (California Healthline, 3/8). According to the Daily News, unnamed sources said that Schwarzenegger "is likely to push for a [Medi-Cal] system that functions more like private medical insurance." The anticipated plan would divide Medi-Cal beneficiaries into "mandatory" beneficiaries -- who are considered very poor and could receive services similar to those currently provided -- and "optional" beneficiaries, who likely would have increased copayments and monthly premiums, the Daily News reports (Los Angeles Daily News, 5/12).
KQED's "The California Report" on Thursday reported on Schwarzenegger's revised state budget proposal (Myers, "The California Report," KQED, 5/13). The complete segment will be available online in RealPlayer after the broadcast.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.