On Thursday, Gov. Jerry Brown (D) signed 13 measures to reduce California's deficit by $11.2 billion through deep cuts to health services and other program changes, the Contra Costa Times reports.
Spending cuts account for about $8.2 billion of the deficit reduction and the remainder is considered funding shifts and internal loans (Harmon, Contra Costa Times, 3/24).
Budget Background
Brown signed the budget measures to help close California's $26.6 billion budget deficit over 18 months.
The governor is continuing to push for another major budget proposal that would place a tax extension measure before voters on a June ballot. However, Brown has faced difficulty obtaining GOP support for the tax plan (Goldmacher, Los Angeles Times, 3/25).
On Thursday, the governor said he would consider an all-cuts budget if Republicans do not support the tax measure. He also has discussed holding a ballot initiative campaign on the tax issue this fall (Contra Costa Times, 3/24).
The main budget bill, which includes an estimated $2.8 billion in additional spending cuts, still is awaiting approval from the governor. Brown said he would sign the bill after voters take up the tax measure (Yamamura, Sacramento Bee, 3/25).
Details of the Cuts
Of the spending reductions signed on Thursday, about $5.8 billion came from trimming social services. For example, the measures cut:
- $1.7 billion from Medi-Cal, California's Medicaid program;
- $1 billion from CalWORKs, California's welfare-to-work program (Contra Costa Times, 3/24).
- $1 billion from First 5 by shifting reserve funds from the early childhood health and education program to Medi-Cal children's services;
- $862 million from mental health services (Sacramento Bee, 3/25).
Health Program Changes
One of the bills (AB 97) signed Thursday outlines changes to health programs. For example, the bill:
- Eliminates Medi-Cal coverage for adult day health care services;
- Ends Medi-Cal coverage for nonprescription cold and cough medicine;
- Limits Medi-Cal beneficiaries to seven physician visits annually in most cases;
- Imposes a 10% reduction in reimbursement rates for doctors and hospitals that serve Medi-Cal beneficiaries;
- Raises premiums for Healthy Families, California's Children's Health Insurance Program; and
- Requires Medi-Cal beneficiaries to pay $5 copayments for doctor visits, $50 copays for emergency department visits and $100 daily copays for hospital stays up to a maximum of $200 (Weintraub, Healthy Cal, 3/24).
The Medi-Cal changes will require approval from the federal government (Yamamura, Sacramento Bee, 3/25).