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Legislature Takes Action on the Budget

Both the Senate and Assembly Budget Committees met this week and voted on many of the Governor’s budget proposals, including most of the health care related policies.

The Senate

On Wednesday, the Senate Budget & Fiscal Review Committee voted to affirm many of Governor Brown’s cuts to the Medi-Cal program and Healthy Families Program, including:

  • Reducing Medi-Cal provider payments by 10%
  • Mandatory copays for physician and clinic visits, pharmacy, hospital and dental services,
  • Shifting Prop 10 money to backfill Medi-Cal services for 0-5 year-olds in FY 2011-12,
  • Increasing Healthy Families monthly premiums, and
  • Mandatory copays for hospital services for Healthy Families.

The Senate Committee, however, rejected the proposal for an ongoing shift of 50% of Prop 10 revenue, and rejected the hard cap on doctor’s visits, medical supplies and prescriptions in Medi-Cal. They rejected the elimination of vision coverage in the Healthy Families Program; in lieu of the elimination, the Committee accepted lower cost frames and lenses which provides a $3 million savings to the State General Fund. They did not hear the Governor’s changes to Adult Day Health Care (ADHC).

Read this document for more on the Senate decisions.

The Assembly

The Assembly Budget Committee met today. Like the Senate, they rejected the caps on Medi-Cal physician visits and prescription drugs. Also like the Senate, they accepted the Governor’s proposal to reduce Medi-Cal provider payments, impose mandatory copayments for physician and clinic visits, etc. and affirmed the $1 billion shift in Proposition 10 money to backfill Medi-Cal services for children ages 0-5 for FY 11-12. They, too, rejected the ongoing shift of 50% of Proposition 10 revenue.

Like the Senate, the Assembly accepted the Healthy Families premium increases and mandatory copayments for hospital services, along with the $3 million reduction to the vision benefit.

The Assembly cut $28 million from ADHC by enforcing existing medical acuity eligibility criteria, consolidating state administration of the program, and making other reforms without eliminating the program. The inconsistency between the Senate and Assembly on ADHC will send the item to Conference Committee.

Read this for more on the Assembly’s proposal.

What’s Next

The next step in the process is for a joint budget committee called the Conference Committee to convene. This will likely start early next week, with daily meetings through the first week of March. Public comment is not accepted in Conference.

The Conference Committee generally decides issues on which the Senate and Assembly Budget Committees voted differently (like ADHC). Because there’s agreement in the two houses about many of the items above, it is safe to assume they’ll more than likely be in the final deal.

The plan is still to have a package approved and signed sometime in early/mid March. However, all Republicans have taken a “no new tax” pledge so it’s still unclear how the Legislature will achieve the 2/3 majority to qualify the revenue pieces for the June Ballot.

More on the budget from Sac early next week…