Gov. Jerry Brown (D) signed ABX1 21 by Bob Blumenfield (D-Woodland Hills) on Friday, which extends a tax on managed health care organizations.
That money helps fund Healthy Families, a program serving 870,000 children in California. Without passage of that bill, Healthy Families officials were staring at a budget shortfall of $130 million in state general fund dollars -- and factoring in the 2-to-1 federal match, that becomes a deficit of $390 million.
That would've been 37% of the program's entire budget, and the state was considering massive enrollment cuts in Healthy Families.
"This is great news for California's lower income children," according to Richard Figueroa, a board member of the Managed Risk Medical Insurance Board, which oversees the Healthy Families program.
"Now we can continue providing necessary services for this population," Figueroa said. "We're pleased the Legislature passed the bill and the governor signed it. It's the result of a lot of hard work -- by health plans, by children's advocates and by the Legislature, to fund a needed program at a time of great fiscal distress."
Now comes problem number two for MRMIB -- how to handle a still-existing deficit of approximately $23 million.
"We are investigating the options, and we still don’t know how much of a deficit we're really looking at," Sarah Smith of MRMIB said. "We're working with the Department of Finance, revising our fiscal estimates, and to come up with ways to close that deficit."
Smith said the deficit issue and possible courses of action will be presented to the board at the next MRMIB meeting, on Oct. 19.
There is a lot to figure out between now and then, Figueroa said. "We don't really know what the outcome will be, it's still a little early," he said. "We're still awaiting additional input from state and federal sources."
For now, though, those decisions look comparatively simple when juxtaposed with the massive cuts MRMIB and Healthy Families officials were contemplating just a few days ago.
"Low-income parents across California have been sick with worry for months, not knowing if at any moment the state would revoke their children’s insurance," bill author Blumenfield said in a release. "This has been a very scary situation with a simple solution."