Governor Proposes New Massive $5.5 Billion in Cuts

by Lesley Politi on May 28, 2009

At the time when needed the most, with more families un-employed and losing their health insurance, taking away Healthy Families would only hurt the state more. Taking away Health Insurance for children in low income households isn’t the answer.

———————————————————————————————–

With California’s budget situation growing worse, and a budget shortfall now projected at over $24 billion, Governor Arnold Schwarzenegger proposed today (May 26) over $5.5 billion in new massive permanent spending cuts on top of what he proposed on May 14th. The Governor will be proposing by Friday details on over $3 billion in additional reductions on top of today’s proposals to reflect the growth of the budget shortfall.

And the news gets grim for next year: the Legislative Analyst last week told the Budget Conference Committee that California will face – even if it adopted every one of the Governor’s spending cut proposals, a budget shortfall for the 2010-2011 State Budget year of over $15 billion.

The Budget Conference Committee convened its hearing today just around 2:30 PM and adjourned just after 4:30 PM. They will reconvene tomorrow (Wednesday) at 09:00 AM (see below). The Budget Conference Committee took no action today – and is not expected to take action on the Governor’s proposals until mid-June or later.

Proposed Cuts Include Elimination of Entire Programs

The proposed cuts announced today, including elimination of entire programs – with an additional $3 billion in new cuts coming by Friday – stunned and shocked Budget Conference Committee members and the audience in the hearing room.

Ana Mantosantos, deputy director of the Governor’s Department of Finance, made the formal presentation of the new proposed budget cuts to the Budget Conference Committee this afternoon that are as deep and wide ranging as ever proposed in California state history.

Included in today’s proposal reductions – which require approval of the Legislature – is the proposed elimination of the state’s welfare to work program, CalWORKS, that serves over 500,000 people, including many with special needs, and critical senior programs

The Governor also proposed elimination of several critical community-based senior programs under the Department of Aging including the Multipurpose Senior Services Program (MSSP).

The Governor also proposed the elimination of the Healthy Families program, which provides with matching State Children’s Health Insurance Program (SCHIP) federal funds, health insurance for over 900,000 children from low income families

Also on the proposed chopping block are even deeper cuts to Medi-Cal to slow growth in use of services, eliminate certain Medi-Cal state funded only programs, cut state funds for the Community Care Licensing program.

The non-partisan Legislative Analyst Office (LAO), who works directly for the Legislature and provides analysis, recommendations and review of budget issues, told the committee last Thursday that California is now facing a budget shortfall of over $24 billion by the end of the 2009-2010 State Budget year. That growing deficit is in addition to the cash flow crisis that if not resolved – could mean the State will not be able to pay its bills after July 1st.

Originally the Budget Conference Committee had scheduled a hearing on May 26 for public comment on the Governor’s proposed cuts to education, but that will be rescheduled at a later date in order for the committee to hear more details on how the Governor intends to make additional spending cuts of over $5.5 billion. Last week, on Thursday, the Ana Mantosantos, deputy director of the Department of Finance, told the Budget Conference Committee that the Governor was looking at proposing the elimination of the CalWORKS and Healthy Families programs entirely.

Details of those new spending cuts have not yet been released yet though Deputy Director of the Governor’s Department of Finance said they would focus on those state programs not mandated (required) by the federal government, including the proposed elimination of the Healthy Families and CalWORKS programs. The CalWORKS program is California’s “welfare to work” program that includes thousands of children and parents who have special needs and disabilities. The Healthy Families program is funded with federal matching funds from the State Childrens Health Insurance Program (SCHIP) that provides health coverage to hundreds of thousands of children from low income families.

SUMMARY OF CUTS PROPOSED TODAY BY GOVERNOR

CALWORKS PROGRAM – ELIMINATE

Proposes to eliminate California’s “welfare to work” program formally called the California Work Opportunity and Responsibility to Kids program, that includes thousands of children and parents with special needs. Program serves over 500,000 people.
2009-2010 State Budget Year: $1.309 billion cut (state general funds)
2010-2011 State Budget Year: $1.765 billion cut (state general funds)

HEALTHY FAMILIES PROGRAM – ELIMINATE

Proposes to eliminate funding for this program and assumes that the program phases out “quickly as possible” after providing notice to those persons in the program. Program serves over 900,000 children.
2009-2010 State Budget Year: $247.8 million cut (state general funds)
2010-2011 State Budget Year: $322.4 million cut (state general funds)

MULTIPURPOSE SENIOR SERVICES PROGRAM – ELIMINATE

Proposed elimination of the Multipurpose Senior Services Program and senior Community-Based Services programs. Funding for Adult Day Health Care would continue in support of the California Department of Aging’s responsibility for Medi-Cal certification of providers.
2009-2010 State Budget Year: $24.2 million cut (state general funds)
2010-2011 State Budget Year: $35.3 million cut (state general funds)

MENTAL HEALTH MANAGED CARE SERVICES AND EARLY PERIODIC SCREENINDG, DIAGNOSIS AND TREATMENT SERVICES (EPSDT)

Proposes to reduce funding for these services but would retain funding for Mental Health Managed Care services for acute inpatient services and prescription drugs for Medi-Cal enrollees only. EPSDT reduction would result from eliminating State general fund money for county programs identified as new programs in 2007-2008 and 2008-2009.
2009-2010 State Budget Year: $92 million cut (state general funds)
2010-2011 State Budget Year: $92 million cut (state general funds)

MEDI-CAL – ADDITIONAL $500 MILLION CUT

This proposal assumes additional reduction (savings) as a result of changes that the State would get from the federal government (if approved by the Legislature) that the Governor previously proposed on May 14, to “enable California to secure essential program flexibilities” to slow the Medi-Cal program growth and to manage Medi-Cal program costs within available resources.
2009-2010 State Budget Year: $250 million cut (state general funds)
2010-2011 State Budget Year: $500 million cut (state general funds)
CDCAN Note: this cut is on top of the $750 million cut (state general funds) to the Medi-Cal program proposed by the Governor on May 14th. Adding the lost federal funds, the proposed cuts to the Medi-Cal program would be approaching $2 billion.

MEDI-CAL – ELIMINATE CERTAIN STATE ONLY PROGRAMS

Propose eliminating for the 2009-2010 State budget year, state only Medi-Cal programs (meaning not required by the federal requirement) including undocumented non-emergency services (breast and cervical cancer treatment and postpartum care, and excluding prenatal and long term care), Institutions for Mental Disease ancillary services payments, dialysis, non-digestive nutrition, and breast and cervical cancer treatment for women over 65 years, and men.
2009-2010 State Budget year: $34.4 million cut (state general funds)
2010-2011 State Budget year: $57.8 million cut (state general funds)

MEDI-CAL – SKILLED NURSING FACILITY COST OF LIVING

Proposes to suspend an estimated 5% cost of living increase effective August 1, 2009 for skilled nursing facilities (AB 1629 and non-AB 1629 skilled nursing facilities)
2009-2010 State Budget year: $67.1 million cut (state general funds)
2010-2011 State Budget year: $109.8 million cut (state general funds)

COMMUNITY CARE LICENSING – ELIMINATE STATE FUNDING

Proposes to eliminate state funding for the Community Care Licensing program. The reduction would be off-set (according to the Governor) by a fee increase to maintain “critical health and safety standards”.
2009-2010 State Budget Year: $19.5 million cut (state general funds)
2010-2011 State Budget Year: $39 million cut (state general funds)

AIDS DRUG ASSISTANCE PROGRAM – REDUCE FUNDING

Proposes to reduce funding for the AIDS Drug Assistance Program (ADAP) and for other Office of AIDS programs. Specific proposals include: expanding client cost sharing and limiting the formulary in the AIDS Drug Assistance Program; reducing and eliminating other HIV/AIDS programs such as HIV Counseling and Testing, Epidemiologic Studies/Surveillance, Therapeutic Monitoring Program, and Home and Community-Based Care.
2009-2010 State Budget Year: $55.5 million cut (state general funds)
2010-2011 State Budget Year: $58.9 million cut (state general funds)

CALGRANTS PROGRAM – ELIMINATE

Would eliminate new awards for the High School Entitlement and Community College Transfer Entitlement programs and CalGrant C program (would continue existing awards).
2009-2010 State Budget Year: $173 million cut (state general funds)
2010-2011 State Budget Year: $450 million cut (state general funds)

CAL GRANTS RENEWALS – COMPLETE DECOUPLING

Would eliminate the increase in award amounts for renewals associated with UC and CSU fee increases. The amount is the net of the partial decoupling proposal included in the Governor’s original budget.
2009-2010 State Budget Year: $28 million cut (state general funds)
2010-2011 State Budget Year: $28 million cut (state general funds)

COMMUNITY CLINIC PROGRAMS – ELIMINATE FUNDING

Proposes to eliminate state funding for Indian Health, Seasonal and Agricultural and Migratory Workers, Rural Health Services Development, and Expanded Access to Primary Care.
2009-2010 State Budget Year: $34.2 million cut (state general funds)
2010-2011 State Budget Year: $34.2 million cut (state general funds)

STATE EMPLOYEE FURLOUGHS (Assumes reductions (savings) if proposed labor agreement with SEIU Local 1000 are not passed (ratified) by the Legislature and a 2 day furlough is maintained for all state employees.
2008-2009 State Budget Year: $60 million cut (state general funds)
2009-2010 State Budget Year: $150 million cut (state general funds)

OTHER REDUCTIONS PROPOSED TODAY BY THE GOVERNOR:

• STATE PARKS – ELIMINATE STATE FUNDING – proposes to eliminate state general funding for state parks and require that these parks operate on fee revenues and special funding only: $70 million cut, 2009-2010 State Budget Year and $143.4 million cut in the 2010-2011 State Budget year.
• MATERNAL, CHILD, AND ADOLESCENT HEALTH – in addition to what the Governor proposed on May 14, proposes to eliminate the remaining state general funding for this program: $10.2 million cut, 2009-2010 State Budget year and $10.2 million cut in the 2010-2011 State Budget year.
• RURAL HEALTH CARE EQUITY PROGRAM: $15.7 million cut, 2009-2010 State Budget year
• UC AND CSU BUDGETS REDUCTIONS – $415 million, 2008-2009 State Budget year; $335 million 2009-2010 State Budget year and $335 million in the 2010-2011 State Budget year.
• HASTINGS COLLEGE OF LAW – ELIMINATE STATE FUNDING – would reduce to the minimum level allowed in law (EC 92212): $10.3 million cut, 2009-2010 State Budget year and $10.3 million cut in 2010-2011 State Budget year.
• REDUCE GENERAL FUND SUPPORT FOR COURTS BY 10%: $181.6 million cut, 2009-2010 State Budget year
• ADDITIONAL REDUCTION TO PRISON POPULATION – commute sentences of nonviolent, non-serious, non-sex offenders one year early: $120.5 million cut, 2009-2010 State Budget year.
• REDUCE DEPT OF CORRECTIONS CONTRACT EXPENDITURES, REDUCE REHABILITATION PROGRAM AND OTHER REDUCTIONS – $788.5 million cut, 2009-2010 State Budget year and $914.4 million cut, 2010-2011 State Budget year.
• CALFIRE EQUIPMENT REPLACEMNT – ELIMINATE FUNDING – proposes a onetime elimination of funding for equipment replacement: $17 million cut in the 2009-2010 State Budget year only.

May 27th Public Comment Hearing on Health & Human Services Issues Still On

As previously reported, the May 27th hearing where the Budget Conference Committee will take public comments specifically on the Governor’s proposals impacting health and human services, is still on.

This hearing will likely draw possibly hundreds, possibly thousands of people in part because the annual Disability Capitol Action Day is being held at the same date and time, on the West Steps of the State Capitol. [see separate CDCAN Action Alert and Report on this]

The committee will take public comments, at specific times (see below for agenda) regarding the Governor’s new proposed spending cuts and reductions to such programs as Medi-Cal, regional centers, In-Home Supportive Services (IHSS), SSI/SSP (Supplemental Security Income/State Supplemental Payment) grants, CalWORKs, proposed elimination of the Cash Assistance Program for Immigrants (CAPI) and more (see below for agenda).

The California Disability Community Action Network, is a non-partisan link to thousands of Californians with developmental and other disabilities, people with traumatic brain injuries, the Blind, the Deaf, their families, community organizations and providers, direct care, homecare and other workers, and other advocates to provide information on state (and eventually federal), local public policy issues.

———————————————————————————————–

The plan to eliminate Health Families will effect about 900,000 children who have health insurance with the program. Also, taking more money from Medi-cal will leave the program with pretty much no funding left.

Source: www.californiaprogressreport.com

Questions Please Call Politi Insurance Agents & Brokers

818-709-8442

www.health-insurancecalifornia.com

Leave a Comment

    Previous post:

    Next post: