Assembly Democrats Seek To Avoid Medi-Cal Cuts in Budget

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On Thursday, Assembly Speaker Karen Bass (D-Los Angeles) detailed the Democrats' budget proposal, which would raise $6.4 billion in tax revenue and avoid funding cuts for health, education and social service programs, the San Jose Mercury News reports.

Like Gov. Arnold Schwarzenegger's (R) spending proposal, Assembly Democrats' plan would expand the state lottery in an attempt to reduce the $15.2 billion deficit (Zapler, San Jose Mercury News, 6/5).

Senate Democrats passed their own budget proposal on Thursday. That proposal does not rely on funds from expanding the state lottery, which will require more money through additional tax revenue, according to Lynda Gledhill, spokesperson for Senate President Pro Tempore Don Perata (D-Oakland) (Young, AP/San Francisco Chronicle, 6/5).

Democrats propose closing tax loopholes and cutting spending to save about $4.6 billion (San Jose Mercury News, 6/5).

Health Care Details

Schwarzenegger's revised budget plan includes a total of $3.4 billion in cuts to health and human services programs, including reducing income eligibility for Medi-Cal, California's Medicaid program (California Healthline, 5/22).

The governor also has proposed eliminating dental benefits for many adult Medi-Cal beneficiaries (California Healthline, 5/20). In addition, the Legislature in February approved and Schwarzenegger enacted a 10% reduction in state Medi-Cal reimbursement rates to providers beginning on July 1 (California Healthline, 5/14).

According to the San Francisco Chronicle, Assembly Democrats' plan calls for restoring most cuts to Medi-Cal, including coverage of dental services.

By comparison, Senate Democrats propose cutting Medi-Cal reimbursement rates to health care providers by 5% and restoring dental benefits for adult Medi-Cal beneficiaries (Yi, San Francisco Chronicle, 6/6).

What Comes Next

Republicans immediately criticized the Democrats' proposal and said California residents should not pay for the Legislature's overspending (Lin, Sacramento Bee, 6/6).

Republicans have pledged not to support tax increases, raising an obstacle to majority Democrats' budget proposal because votes from Republican lawmakers are needed to meet the state constitutional threshold for enacting the budget (San Francisco Chronicle, 6/5).

Bass said that she hopes the Legislature will vote on a budget by July 1 but that she does not think it is likely (Sacramento Bee, 6/6).


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