California Legislature Approves FY 2009 State Budget, Restores Some Health Cuts

Main Category: Public Health
Article Date: 17 Sep 2008 - 11:00 PST

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The California Legislature on Tuesday approved a fiscal year 2009 state budget plan that restores some previously proposed cuts to health care and other programs, the San Jose Mercury News reports (Zapler, San Jose Mercury News, 9/16). Beyond those already introduced by state Senate Democrats, the budget agreement does not include cuts to health care, human services or education programs, according to information Ventura County officials received from the California State Association of Counties (Biasotti, Ventura County Star, 9/16). Lawmakers acknowledged that the proposal would close a $15.2 billion state budget deficit but that it would not solve California's long-term fiscal problems. Senate President Pro Tempore Don Perata (D) said, "Let's be clear: All we've done is roll the problem over to the next Legislature" (Lin, AP/San Francisco Chronicle, 9/16).

The proposal does not eliminate dental services for adult Medi-Cal beneficiaries or impose new restrictions on Medi-Cal services for undocumented immigrants. Medi-Cal is the state's Medicaid program (Halper/Rau, Los Angeles Times, 9/16). The proposal also would restore most of the 10% cut in Medi-Cal payments to health care providers beginning in March 2009 (Lin, AP/San Francisco Chronicle, 9/16). California's Medicaid reimbursement rates will remain the lowest in the U.S. even after the cuts are restored, according to the Los Angeles Times (Los Angeles Times, 9/16). The budget proposal includes a provision that would increase monthly premiums for Healthy Families, California's version of SCHIP (Los Angeles Times, 9/16).

The proposal calls for $7.1 billion in spending cuts and seeks to boost revenue by $9.3 billion by moving up deadlines for some tax payments, ending some tax loopholes and increasing state income tax withholdings for some Californians (AP/San Francisco Chronicle, 9/16). Under the proposal, the state would be able to sell bonds that would be repaid using future lottery revenue and could make further changes to the state budget process. Those provisions would be presented to voters for approval. Assembly Speaker Karen Bass (D) said a special election could be held as early as March (McKinley, New York Times, 9/16).

Gov. Arnold Schwarzenegger (R) said the spending restraints in the budget are not strong enough and the proposed state reserve funds are not adequately protected. The governor threatened to veto the measure. Legislative leaders said they are confident that they will be able to override a veto (Los Angeles Times, 9/16).

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