(seliaymiwell/flickr)

After years of devastating cuts to the health and human services budget, this year’s small surplus brought restoration of some programs.

Mental health programs will get a one-time boost of $140 million. The adult dental program, Denti-Cal, cut back in 2009 and leaving tooth extraction as just about the only service being covered, has been restored, albeit partially. Benefits won’t start until next May.

But lost in the deal was a proposal to provide some therapies to 500 children with autism. Those children had lost some services when the state moved them from Healthy Families and to Medi-Cal.

Then there’s the issue of funding to county health programs. Counties bear the cost for providing health care to the uninsured. Gov. Brown has been arguing since he introduced his budget in January that counties will gain federal money in January under the full implementation of the Affordable Care Act and so the state could reduce its own health funding to counties. But counties have fought that idea, saying that there would still be plenty of uninsured people after Jan. 1 — and that now is not the time to cut the safety net.

While we’re still waiting for final language, the legislature seems to have agreed with the governor’s numbers, and it appears $300 million in county health funding cuts are coming.

Alex Briscoe, Director of Alameda County’s Health Care Services Agency, called it a “money grab” that will “threaten the stability of local safety nets.”

Briscoe says the cuts presume that safety net providers are adequately funded right now, a presumption he called “offensive.”

“The state has overestimated savings it will achieve, underestimated the burden of the residually uninsured and put forward a proposal that is divorced form the reality of local safety nets,” he said.

The budget deal also leaves in place a 10 percent cut in Medi-Cal provider rates — cuts that were approved by the legislature in 2011 and then held up in a long court challenge. The appeals process was exhausted last month, and the cuts will likely move forward this summer.

California has some of the lowest Medicaid reimbursement rates in the nation, advocates say.

(Justin Sullivan/Getty Images)

Gov. Jerry Brown’s revised budget plan is a mixed bag for health advocates and some county officials.

Brown said the state would take the lead on a key provision of the federal health law — expanding Medi-Cal to more than one million Californians. Brown scrapped earlier plans to consider a more complicated, county-based system.

But Brown anticipates recouping more than $300 million from the counties next fiscal year – money that pays for public health programs and care for the uninsured. Brown’s rationale? With the full implementation of federal health reform next year, more people will enroll in Medi-Cal and fewer people will show up to county emergency rooms.

Farrah McDaid Ting with the California State Association of Counties says Brown’s proposal makes no sense. She says plenty of people will still rely on county services in 2014.

They are “people who qualify for Medi-Cal but don’t sign up, people who have a hard time signing up or staying on programs, the undocumented in our communities and those who are in between private health plans,” McDaid Ting said. “We need to retain enough funds to serve those people.”

That could be 3 to 4 million Californians who remain uninsured even after federal health reform is fully implemented, according to projections from UC Berkeley and UCLA. Brown and state health officials say they are developing a “mechanism” that will determine county savings based on real data.

Advocates fanned out across California Tuesday holding five statewide rallies, including one in front of state offices in Oakland, where they called for a rollback of cuts to adult dental care, children’s nutrition programs and other social services.         

“I think the most important number to remember is that one in four children in California are in poverty now,” Jamila Edwards Harris with the Children’s Defense Fund said. “And that number has only risen since budget cuts over the last five years.”

Brown’s budget also continues pending cuts to Medi-Cal providers, a plan that has been tied up in federal court since it passed in 2011.

In Thursday’s State of the State speech, Gov. Brown called for a special legislative session to address the Affordable Care Act. (Justin Sullivan/Getty Images)

In his State of the State speech Thursday morning, Gov. Brown spent about 60 seconds addressing health and human services — and all those seconds were devoted to the rollout of the Affordable Care Act.

Early in his speech, Brown reiterated his theme of fiscal discipline and seemed to urge caution in implementing the Affordable Care Act, stating, “The ultimate costs of expanding our health care system under the Affordable Care Act are unknown. Ignoring such known unknowns would be folly.”

Later in the speech came the bulk of his comments about the ACA. Here’s the transcript:

“California was the first in the nation to pass laws to implement President Obama’s historic Affordable Care Act. Our health benefit exchange, called Covered California, will begin next year providing insurance to nearly one million Californians. Over the rest of this decade, California will steadily reduce the number of the uninsured. Today I’m calling for a special session to deal with those issues that must be decided quickly if California is to get the Affordable Care Act started by next January.

“The broader expansion of Medi-Cal that the Act calls for is incredibly complex. It will take more time. Working out the right relationship with the counties will test our ingenuity and will not be achieved overnight. Given the costs involved, great prudence should guide every step of the way.”

Let’s take these two items one at a time, starting with the health benefit exchange. Brown is calling for a special legislative session so that new laws necessary to implement the exchange can take effect more quickly. That speed is necessary since the exchange must open for people to enroll on October 1. Health insurance purchased in the exchange will start on January 1, 2014.

Regarding Medi-Cal, the governor’s comment of “working out the right relationship with the counties” is an allusion to money, a topic he addressed when he released his budget earlier this month.

Right now, California counties receive billions in state dollars to care for the uninsured. Under the Affordable Care Act, most of the uninsured will have access to coverage. That access will largely be paid for in federal dollars. Gov. Brown believes that since the counties will benefit from this new federal money, they should pick up the tab for other things the state has traditionally funded. Childcare subsidies is one idea that has been tossed out. Determining the “right relationship with the counties” could shape up to be one of the political battles to watch in the coming months.

The “unknown” of the ultimate cost is, in part, because no one can be sure exactly how many people will sign up for coverage. In addition, the mass marketing that is expected to happen this summer to encourage people to enroll is expected to bring in many people currently eligible for Medi-Cal but not currently enrolled. The state will be on the hook for half the costs of these people — not the 100 percent federal dollars for the newly eligible.

Listen to Jerry Brown’s comments on health care reform:

Gov. Brown is proposing California's counties relinquish some of their state health funding once the Affordable Care Act is in place. (Justin Sullivan/Getty Images)

We’re now 354 days from the rollout of the Affordable Care Act next Jan. 1. While the governor declared the state’s participation in the Medicaid expansion at his budget unveiling yesterday, he also proposed two ways to handle that expansion.

Under one scenario, the state will continue to administer the program. Under the other, each of California’s 58 counties will oversee running Medi-Cal, California’s version of Medicaid, for its own residents.

The Affordable Care Act dictates that the federal government will pay 100 percent of the cost for those people newly eligible for Medicaid, and in both proposals, the state’s position is that California counties will get some fiscal relief once those federal dollars start flowing.

But don’t get too excited, counties.

California Secretary of Health and Human Services Diana Dooley yesterday referred to a “conversation” around “appropriate sharing” that needs to happen between the state and its counties around financial responsibilities.

“Conversation” might prove to be a euphemism for what could become a vocal debate between the state and the counties. And maybe between counties themselves.

Alex Briscoe, Director of Alameda County’s Health Care Services Agency, told me this morning that “sharing” presumes that current state funding is sufficient to meet the needs of the indigent poor, an idea he called “simply preposterous.”

“There’s an assumption we’ve been fully funded,” he said. “That is simply not accurate.”

Counties bear the responsibility for caring for poor uninsured adults, and Alameda is one of 55 California counties that has moved forward with implementing a Low Income Health Plan (LIHP), a bridge to the 2014 Medi-Cal expansion. About a half-million Californians are currently enrolled.

Bill Walker, Contra Costa County’s Health Director, says he would support having county-level responsibility for overseeing the Medi-Cal expansion. “The devil is alwyas in the details win terms of agreements between the state and the county,” he told KQED’s Mina Kim yesterday. “And obviously at the end of the day, the question is what are the rates, what is the cost sharing, and how do the dollars flow?”

But whether the state or counties handle the Medi-Cal expansion, there will still be at least two million people who lack insurance, as Sarah Varney explained at Kaiser Health News:

Those residents, many of whom are undocumented and barred from buying their own insurance coverage through “Covered California,” the state’s online marketplace, and are ineligible for any public insurance programs, will continue to rely on county-run facilities and safety-net clinics.

If the state drains the counties of health care funding, says Anthony Wright, executive director of Health Access, an advocacy group, “You run the risk of losing public hospitals and clinics at exactly the moment we need all the capacity we can get.”

Later this month, the governor is expected to call for a special legislative session on health care issues.

(Military Health/Flickr)

Gov. Jerry Brown has released his new state budget, including plans for implementing the Affordable Care Act in California. In a press conference this morning, the governor said he plans to handle that implementation “cautiously.”

“We are committed to expanding Medi-Cal, we’re committed to bringing more people into the healthcare system, but we recognize there are big costs out there,” the governor told reporters. “There are big unknowns so we’re going to move carefully, but we’re going to move with commitment, because I believe people do need decent healthcare, and I believe what Pres. Obama did was historic. It was heroic, and I’m going to do everything I can to be a good partner to make sure his plan works.”

The ACA calls for an expansion of the Medicaid program, known as Medi-Cal in California. The federal government will pay 100 percent of the costs of the new enrollees through 2016. After that, the federal contribution will decline to 90 percent by 2020.

The governor is proposing two ways to handle the expansion.

The first option would be a pretty straightforward expansion of the existing program, which would cover people earning up to 138 percent of poverty as described in the federal law. But the governor is proposing that this expansion would cover only health care costs, not long term care costs.

The governor’s second option would be a county-based expansion. Counties would build on the Low Income Health Program, also called the “Bridge to Reform,” currently in place in 55 of 58 California counties. In a press call with reporters, California’s Secretary of Health and Human Services Diana Dooley pointed out the counties stand to benefit financially from the influx of federal dollars when new enrollees enter the system. Both proposals acknowledge that counties benefit.

“It is a recognition they will have costs reduced,” Dooley said, referring to counties. “The relief to the system is a relief to the counties whether we do it at the counties or whether we do it at the state. The counties have the obligation to provide care to this population and that obligation will be satisfied with new federal funds. So the conversation has to be what is an appropriate sharing of that new relationship with the availability of new federal funds.”

Dooley did not put a timetable on reaching a decision of which path to take, but said “the conversation starts today.”

While those newly eligible for Medi-Cal under the Affordable Care Act will be funded 100 percent by the federal government, many tens of thousands of people currently eligible but not enrolled are also expected to sign up for Medi-Cal. That’s because of several factors. The individual mandate requires everyone to have health insurance, and the Affordable Care Act requires more streamlined enrollment into state run Medicaid programs. The Health Insurance Exchange, Covered California, is expected to launch a major marketing effort to bring people in to purchase insurance. Many people eligible for Medi-Cal will likely respond.

The federal government is not picking up the whole tab of this currently-eligible-but-not-enrolled population. The state has put $350 million in the budget as a “placeholder,” Dooley  said. It’s hard to be sure if that’s enough or too much money. Dooley discussed the difficulty of determining true numbers because estimates of how many people will enroll vary widely. One recent report showed that between 240,000 and 510,000 currently eligible people are expected to be enrolled between 2014 and 2019. That’s a big differential.

At a rally by health advocates in San Francisco today, Linda Lew of Health Access chided the state for being so careful. “It’s good to be cautious,” she told KQED’s Mina Kim, “but in some ways it’s needlessly cautious. The Medicaid expansion is one good example. The first two years are 100 percent federally funded and subsequent years are 90 percent funded, so it’s not going to be a huge lift on the state.”

In a statement on its website, the California State Association of Counties said it was “pleased” that the governor is moving ahead with implementing the Affordable Care Act. But the group echoed the Administration in discussing the challenges.

“Counties recognize that a number of short- and long-term questions about health reform remain unanswered and the uncertainty makes implementation challenging. These proposals carry risks for counties, too. Counties want to be sure that all options for Medicaid expansion are discussed and that the critical role of counties in delivering health services, including hospital and safety net services, is maintained.”

Editor’s note: This post has been updated with details from California’s Secretary of Health and Human Services and other reactions to the governor’s budget.

(Max Whittaker: Getty Images)

Governor Jerry Brown released his revised budget this morning and the cuts to health and human services are significant. Since the economy soured in 2007, state cuts to health and services programs have exceeded $15 billion .

Today the governor announced:

• An additional $400 million in cuts to Medi-Cal, mostly to hospitals and nursing homes
• Reductions to the “Healthy Families” program which covers children, effecting their access to health care. Potential savings are $48 million
• Reducing In-Home Support Services hours by seven percent for a savings of $99 million