The past week has been a roller coaster for health care reform... but it ended on a great note.
The Senate Finance Committee, after suggesting progress in its "bipartisan" negotiations, admitted it was not ready to pass out a bill... or even produce one before the August recess. The other committee of jurisdiction, the Senate HELP (Health, Education, Labor and Pensions) Committee, had passed out its part of health reform two weeks ago. Senator Max Baucus put a deadline of September 15th for action by his Senate Finance Committee.
In the House of Representatives, two or three committees had done their work, but the remaining committee, Energy and Commerce, was being held up by conservative "Blue Dog" members. Negotiations broke down, were rejoined, and went back-and-forth in the past week.
In the last 48 hours, a deal was had between Energy and Commerce Chairman Henry Waxman (D-Los Angeles) and four of the committee "Blue Dogs." One of the concessions was time, having a committee vote this week but postponing a full floor vote until after the August recess. The substantive changes were more concerning, including reducing the subsidies to make health coverage affordable for low- and moderate-income consumers.
The Progressive Caucus, chaired by California Representative Lynn Woolsey pushed back, especially against changes in the public health insurance option and the affordability subsidies. They finally agreed to support the bill in negotiations when they worked to find other savings to restore some of those affordability subsidies. (More about the substance of the bill and amendments later.)
This evening, the House Energy and Commerce Committee did, in fact, pass the bill H.R. 3200 out of the committee, 31-28, with all but five Democrats voting for the measure. Those conservative "Blue Dogs" joined Republicans who were united in opposition.
For Californian Representatives who made up a sizable portion of the Committee, the vote was exactly party line. California Democrats, including New Democrats and Blue Dogs, voted for the measure: Henry Waxman, Lois Capps, Doris Matsui, Anna Eshoo, Jane Harman, Jerry McNerney. The two California Republicans voted against, including George Radanovich and even Mary Bono Mack, who occasionally has broken with Republicans on certain votes.
It was noted that the passage of the bill in this committee was historic--this committee, nor this country, had not reached this point in health reform in the early 1990s. And the passage does provide some much-needed momentum going into August recess. Health reform has passed four of five committees. This bill will be available for a full House floor vote right after the break in September.
There's a lot more work to do, but we should savor important steps in the process.
Here's a report by Cynthia Craft, communicatin & policy coordinator at Health Access, from the MRMIB meeting on Thursday:
Disclosing that it likely will have to purge some children from the Healthy Families Program, the Managed Risk Medical Insurance Board, or MRMIB, reported Thursday that the wait list for the program, which froze enrollment July 1, had grown to 33,146 children in just two weeks.
The number was higher than anyone had imagined, and it reflects the bitter irony of cutting health care assistance for kids of low-income, tax-paying, legal residents at a recessionary time when they most need help.
As it now stands, the Healthy Families Program has lost funds that total $533.4 million, including federal matching funds no longer available due to the $194 million cuts made by the Legislature and Gov. Schwarzenegger. The federal government returns $2 of taxpayer funds to Healthy Families for every $1 the state dedicates to the program.
Advocates laid blame at the feet of both the governor and the Legislature for the choices they made in balancing the state budget.
“This is really a dark hour in California, when we are jettisoning children over other interests,” said Steve Barrow of the California Premature Infant Coalition, which strives to reduce the statewide 10% premature birthrate.
The outlook for California’s children in this down economy is likely to get bleaker, still. MRMIB announced it was setting a public meeting date of August 13th to discuss disenrollment, or kicking currently enrolled kids out of the program.
Several health care advocates testifying before MRMIB warned of “dire consequences” if children lost continuity of care, particularly in the case of cancer treatments.
Nearly every one of the two dozen or so who testified spoke of collaborating to find help from outside funders to prop up the Healthy Families program until its financial outlook improves.
Already, the First 5 Commission passed a resolution to help fill the gap for Healthy Families. Kris Perry, executive director of First 5, said it “pledged to provide, with some of the others, some of the funds” for children up to five years old. It was clear that the First 5 Commission was in the position to assist – but only to a point.
Nevertheless, Cliff Allenby, the chair of MRMIB, told Perry, “Needless to say, we appreciate your efforts since we are clearly in a large hole.”
Many held out hope that legislators would be motivated to successfully challenge the cuts upon reconvening after summer recess Aug. 17th.
Healthy Families was established by the federal government for low-income working families to provide health care for their children. State budget cuts made it necessary to establish a wait list for new enrollees July 17, and 14,000 children signed up the first week. Those who are bumped from the program through the anticipated disenrollment would go to the end of the list.
Earlier this year, President Obama announced an expansion of Healthy Families, known in Washington as the SCHIP program, funded by tobacco tax money. The President heralded the move as an important step in his larger goal of reform aimed at extending coverage to the nation’s 42 million uninsured adults. During the previous administration, former President George W. Bush vetoed legislation expanding the program to cover more children.
But California’s troubles, which attendees at the hearing said included a void of “emboldened leadership” on the state level, led to the opposite of what Obama intended. Now, health care coverage is less accessible and less affordable for low-income, working families in California – at a time when several other states managed to cover more children.
Even for families fortunate enough to remain in the much-smaller Healthy Families Program, keeping their children covered will become increasingly difficult financially. MRMIB plans to shift more out-of-pocket costs on to families enrolled in the program. Some of the cost-shifting suggestions read aloud by a staff member Thursday were drastic enough to make audience members audibly gasp.
The proposals, which staff and MRMIB said had yet to be thoroughly analyzed, include:
* Paying for eye exams, but not for glasses. * Eliminating vision benefits altogether. * Rescinding a new rate increase to insurers such as Anthem Blue Cross. * Increasing medical co-pays, such as: -- Physician visits would rise from $5 to $10. -- Name-brand prescriptions would rise from $5 to $10. -- Inpatient hospitalization would rise from $0 to $250. -- Outpatient hospital services would rise from $5 to 20% of the service cost. -- Emergency room services would rise from $5 to $50 unless hospitalized. -- Medical transportation would rise from $0 to 20%. -- Durable medical equipment would rise from $0 to 20%. -- Basic outpatient mental health services would rise from $5 to $10. -- Inpatient alcohol and drug treatment would rise from $0 to $250 per admission. -- Outpatient alcohol and drug treatment would rise from $5 to $10. -- Eye exams, if not eliminated, would go from $5 to $25. -- Subscriber premiums would go from $20 per child to a maximum of $60, in the income range from 150%-200% of the federal poverty level. -- Subscriber premiums would go from $30 per child to a maximum of $90 for families in the range of 200%-250% of the federal poverty level.
As of June 2009, Healthy Families served 920,000 children. In recent months, the program has accepted 29,000 new enrollees monthly.
On Thursday, MRMIB members mostly sat silent while listening to input from the community. Those testifying with concerns about children’s health included Beth Capell, the advocate for Health Access California, who noted that health care costs were the major cause of homelessness for families prior to the launch of Healthy Families.
“We are about to return to those dark days,” Capell said, noting that the governor’s “blue pencil” cuts also obliterated funding for community health clinics.
Capell also pointed out that the number of children at risk of not having coverage in California is greater than the population of 40 states including Massachusetts.
Also testifying in support of children’s health care were representatives from Children Now, the 100% Coalition, the California Teachers Association, the American Academy of Pediatrics, Local Health Plans of California, California Children’s Hospital Association, the Children’s Coalition, PICO, California Primary Care Association, Santa Clara Health Plans and the Community Health Council.
That's a high bar: last month, they closed the door to new enrollments, instituted a "waiting list" which is really just a euphemism for denying coverage to 350,000 children over the next year.
But this meeting will be even tougher. With a $194 million shortfall due to the budget signed by Governor Arnold Schwarzenegger Tuesday (which includes $50 million that he did through a controversial line-item veto), the board may have to take even more drastic steps--to kick hundreds of thousands of children off of coverage.
It is projected that over 900,000 children would be denied coverage--doubling the number of uninsured children in California, undoing a decade of progress.
The San Jose Mercury News editorial board sums up the issues with appropriate disdain. The Governor and Legislature appropriately criticized insurers from rescinding coverage from patients, but their action here is as bad, yanking coverage during a bad economic time when such coverage is probably needed most. Coverage that won't be there during when you need it is no longer coverage. If Healthy Families starts disenrolling children from coverage, it fundamentally alters the program forever.
MRMIB will review options, including if any money can come from other sources like the First Five Commission, or from insurers who participate in the program. But the outlook is grim.
Here's how the White House framed health reform today, in terms of providing security for consumers, especially from the worst abuses of insurers:
The Security You Get from Health Insurance Reform:
* No Discrimination for Pre-Existing Conditions Insurance companies will be prohibited from refusing you coverage because of your medical history.
* No Exorbitant Out-of-Pocket Expenses, Deductibles or Co-Pays Insurance companies will have to abide by yearly caps on how much they can charge for out-of-pocket expenses.
* No Cost-Sharing for Preventive Care Insurance companies must fully cover, without charge, regular checkups and tests that help you prevent illness, such as mammograms or eye and foot exams for diabetics.
* No Dropping of Coverage for Seriously Ill Insurance companies will be prohibited from dropping or watering down insurance coverage for those who become seriously ill.
* No Gender Discrimination Insurance companies will be prohibited from charging you more because of your gender.
* No Annual or Lifetime Caps on Coverage Insurance companies will be prevented from placing annual or lifetime caps on the coverage you receive.
* Extended Coverage for Young Adults Children would continue to be eligible for family coverage through the age of 26.
* Guaranteed Insurance Renewal Insurance companies will be required to renew any policy as long as the policyholder pays their premium in full. Insurance companies won't be allowed to refuse renewal because someone became sick.
Many of these concepts are, or have been, bills here in California, including coverage for young adults dependents, to capping out-of-pocket expenses, to prohibiting gender discrimination.
At a Health Access California board meeting last week, it was remarked how much of our legislative agenda would be resolved if the health reform in the House of Representatives, H.R. 3200, was passed. And what's more remarkable is how most of these elements are the accepted consensus of health reform, rather than the controversial items.
GOVERNOR'S LINE-ITEM CUTS DEVASTATE CALIFORNIA HEALTH CARE * $50 Million More in Cuts to Healthy Families; Over 900,000 Kids to Be Denied Coverage
* Additional cuts to HIV/AIDS Care, Community Clinic Funding, Maternal/Child Health Programs, Medi-Cal County Administration, and Key Human Services
* Shocking, Large, Outrageous Cuts Will Deny Coverage & Care to Hundreds of Thousands of Californians, Impact Health System On Which We All Rely, and Hurt Our Economy
* More Updates on blog.health-access.org: Are These Cuts Legal?; Updates on Federal Health Reform; Wonkery on the Weekend; The Challege of August Recess for Reform; Governor Schwarzenegger's Knife; Reaction to the Passage of a Budget; The President Lays Our What's In It For You; The Governor's Budget "Reforms" of Medi-Cal; and much more...
Governor Arnold Schwarzenegger today signed a budget reduction package today, including an additional $600+ million in unilateral and controversial cuts, largely to health and human services.
BACKGROUND: In February 2009, the Governor signed a budget for the current fiscal year that included $15 billion in spending cuts to health and other vital services, as well as a spending cap plus five other proposals that voters rejected in a special election on May 19, 2009.
With the economy worsening, the Governor and the Budget Conference Committee proposed solutions to fill the growing budget deficit, a final budget was passed last week that was largely negotiated by the Governor and legislative leaders. Combined, the February and July solutions signed by the Governor, close a $60 billion budget gap in the state’s General Fund.
Governor Arnold Schwarzenegger today signed the budget that was passed last week, but not before making $650 million in additional "blue pencil" reductions. Over $516 million were in specific line-item veto cuts, with over $400 million of those to health and human services. The added cuts were jaw-dropping to many advocates for health and human services.
The Governor has zeroed out some programs, such as some state funding for community clinics, and others were preserved in name only. Healthy Families, which has grown over a decade to cover nearly one million children, will not be the same program, as it is now shuttered and will likely be actively kicking kids off coverage.
THE ADDITIONAL CUTS made unilaterally by Governor Schwarzenegger today include:
* An additional $50 million cut to Healthy Families, raising the total shortfall for the program to $194 million, well over half the program's state funding. As a result, Healthy Families will likely deny coverage for over 900,000 children, including actively disenrolling hundreds of thousands of kids, yanking their coverage away. This one budget cut would double the number of uninsured children in the state of California, undoing a decade of progress.
* Additional cuts of $52 million to programs under the Office of AIDS Prevention and Treatment, including education and prevention, therapeutic monitoring, counseling and testing, early intervention, home and community-based care, and housing.
* An additional $25 million cut that would eliminate state funding for community clinics, including Expanded Access to Primary Care. This is especially devastating when the number of uninsured are increasing, partially due to other cuts.
* An additional $12 million in cuts to Maternal, Child and Adolescent Health local assistance programs, including the Adolescent Family Life Program and the Black Infant Health program.
* An additional $60 million in Medi-Cal county administration, making it harder for California children, parents, seniors and people with disabilities to get on and stay on Medi-Cal coverage.
Other human services cuts include:
* An additional $80 million cut to funding for the Child Welfare Services Program, which responds to reports of abuse and neglect. * An additional $50 million cut to funding for Regional Center services for children up to age 5 who have developmental disabilities. * An additional $40 million in cuts to In-Home Support Services (IHSS) home care, further reducing eligibility. * An additional $16 million in cuts to domestic violence programs, largely battered women's shelters.
Consumer and community groups point out that California has better choices than to deny coverage to hundreds of thousands of children, or to make such devastating cuts to the health system on which we all rely. Check the Health Access website (http://www.health-access.org) and blog (http://blog.health-access.org) for the most up-to-date information.
THE OVERALL HEALTH BUDGET signed today, including the cuts made today, include the following cuts to health care:
* Denying hundreds of thousands of children health coverage. The Healthy Families program current covers nearly one million low-income children between 100-250% of the federal poverty level. The proposed cut of $194 million in state dollars (well above the recommendation of the Budget Conference Committee) would deny over 900,000 children coverage. First, the newly-imposed wait list would deny over 350,000 children over the course of the budget year. Second, the size of cut would force California to actively disenroll over 500,000 additional children--based on an assumption that the children would be kicked off during the time of annual renewal. depending on when they are disenrolled. In addition, for every dollar we cut in Healthy Families, we are losing two dollars in federal matching funds for our health system, and our economy.
* Making severe cuts to prevention-oriented and core health programs. While rejecting outright eliminations, the Budget Conference Committee made drastic cuts to a series of health care programs and services. The budget also includes:
o Cutting mental health, including reducing by $92 million of funds for the Mental Health Managed Care Services, and the Early and Periodic Screening, Diagnosis and Treatment program. A $14 million cut would eliminate state money for ancillary health services in Institutions for Mental Disease. o Cutting HIV/AIDS care, reducing funding by $85 million.
o Cutting Adult Day Health Care, limiting it three days a week and other changes, a $26.8 million cut o Cutting hospitals, taking $23 million from the Distressed Hospital Fund o Cutting funding for community clinics, zeroing state general fund support for programs like Expanded Access to Primary Care, (with cuts also to the Rural Health Services, Seasonal Migratory Worker and the Indian Health Program).
o Cutting maternal and child health care significantly, including the Black Infant Health Program; Adolescent Family Life Program, and others. o Cutting last-option health coverage for those rejected for “pre-existing conditions”, reducing the Major Risk Medical Insurance Program by $6.6 million. MRMIP already has a waiting list, with 7,100 enrollees, despite estimates of over 400,000 eligible “uninsurables.” o Cutting health coverage for mothers and newborns babies to get prenatal and post-natal care, reducing the Access for Infants and Mother program by $4.9 million. The cut would force a waiting list, basically denying care to pregnant women.
o Cutting all of the Immunization Program, for $18 million. o Cutting community application assisters that help enrollment in public coverage like Medi-Cal and Healthy Families, for $3 million. o Suspending a children’s dental disease prevention program, for $3 million.
* Advancing controversial Medi-Cal proposals that would make it harder for patients to get the care they need.
* One provision would seek to privatize county eligibility workers for Medi-Cal and other human services. As reported in the media, the legislative leaders agreed to a process to consider the Governor’s recent proposal to privatize and replace the current county workers who assist Californians enrolling in Medi-Cal and other social services with a private contractor like Maximus or Halliburton. The reports indicate that the consideration would allow stakeholders to vet the proposal and requires legislative approval. * Another provision would mandate managed care for seniors and disabilities on Medi-Cal. Consumer advocates have been long concerned about the impact on patients and their access to care and specialists, as well as funding impacts to safety-net institution.
It’s important to note that these and other cuts are on top of the cuts made in February 2009. Those cuts included the elimination of 10 benefits, including dental coverage, for the nearly 3 million adults (parents, seniors, and people with disabilities) with Medi-Cal coverage. Those went into effect recently on July 1, 2009.
Here's Assembly Speaker Karen Bass, with emphasis added by us:
“It’s a shame Governor Schwarzenegger is so eager to tear down the safety net that he appears willing to break the law to do it.I am asking Legislative Counsel for a definitive opinion on the legality of the governor’s actions."
"The cuts the governor made today will have catastrophic effects on children, domestic abuse victims, and seniors. The cuts the governor made today have broken the lifeline to the state’s most vulnerable and underserved. We sent the governor budget solutions that solved the deficit. He knows that. He knows we pledged to work with him on building up the reserve in August. He knows all that and still chose to take punitive measures against children and AIDS patients. It wasn’t too long ago when a 24 year old woman born with HIV pleaded with Legislators not to adopt the Governor’s proposal to eliminate the program that provides the drugs that keep her alive. It wasn’t too long ago when a disabled woman, needing both the assistance of a wheel chair and oxygen, pleaded to stay out of a nursing facility in the event her in-home assistance would be eliminated by the Governor.
“Throughout the past several months, Democrats in the Legislature worked to spare these vital services from elimination. The governor’s actions today have not just caused harm; his actions today put lives in jeopardy. He is cutting funding for the Black Infant Health Program at a time when African American babies have a mortality rate three times higher than white babies. The governor is choosing to make devastating cuts to child welfare services, leaving children and foster kids vulnerable. Earlier in the budget process the governor threatened to veto bills that charged oil companies the same fair share severance tax they pay in other states and to levy tobacco products for the harm they inflict on the health care system and the state’s general fund. Had the governor not stood up for big oil and big tobacco, these devastating cuts also could have been avoided.
“The governor said he wanted to take on waste, fraud, and abuse but that appears to have meant taking on victims of domestic abuse. That’s shameful, but not totally unexpected from an administration that has been historically hostile to safety net programs.
His Republican colleagues in the legislature blew up their deal and the governor takes it out on the sick, the young, the elderly and battered women—all cuts he has been dying to make since his May budget revisions. For our part, my colleagues and I will move forward to restore any of these unnecessary cuts that are found to be legal and build a responsible reserve to accompany the full deficit solution we sent the governor last week.
“I do also have to say this kind of game playing by the governor doesn’t bode well for success in terms of water, corrections, pensions or any of the other items the he is looking to in order to build some kind of real legacy. He and his staff may be lighting cigars to celebrate these cuts, but they should also be concerned about the devastating harm they are causing—and about burning their bridges.”
Governor Arnold Schwarzenegger signed the budget today, but not before making $650 million in additional "blue pencil" reductions. Over $516 million were in specific line-item veto cuts, with over $400 million of those to health and human services. The added cuts are jaw-dropping.
* An additional $50 million cut to Healthy Families, raising the total shortfall for the program to $194 million, well over half the program's state funding. As a result, Healthy Families will likely deny coverage for over 900,000 children, including actively disenrolling hundreds of thousands of kids, yanking their coverage away. This one budget would double the number of uninsured children in the state of California, undoing a decade of progress.
* Additional cuts totalling $52 million to programs under the Office of AIDS Prevention and Treatment, including education and prevention, therapeutic monitoring, counseling and testing, early intervention, home and community-based care, and housing.
* An additional $25 million cut that would fully eliminate state funding for community clinics, including Expanded Access to Primary Care. This is especially devastating when the number of uninsured are increasing, partially due to other cuts.
* An additional $12 million in cuts to Maternal, Child and Adolescent Health local assistance programs, including the Adolescent Family Life Program and the Black Infant Health program.
* An additional $60 million in Medi-Cal county administration, making it harder for California children, parents, seniors and people with disabilities to get on and stay on Medi-Cal coverage.
Other human services cuts include: * An additional $80 million cut to funding for the Child Welfare Services Program, which responds to reports of abuse and neglect. * An additional $50 million cut to funding for Regional Center services for children up to age 5 who have developmental disabilities. * An additional $40 million in cuts to In-Home Support Services (IHSS) home care, further reducing eligibility. * An additional $16 million in cuts to domestic violence programs, largely battered women's shelters.
There is a question of how legal these cuts are, given that this isn't a budget, but several bills to adjust the budget. Senate President Pro Tem Darrell Steinberg released a statement saying this "isn't the last word."
Right now, we're waiting for the Governor to announce his signing of the state budget at 11:00am. Kevin Yamamura of the Sacramento Bee has more details. Part of the question is what authority does the Governor actually have to make additional "blue pencil" cuts, given that this isn't actually a budget--that was passed in February--but a mid-year budget cuts package.
When we find out about the Governor's added cuts, we'll put our first report out via Twitter, at @healthaccess or www.twitter.com/healthaccess. (There's a Twitter feed on our homepage as well.)
But as always, we'll try to post information and analysis on this blog as soon as possible.
Is recess good or bad for reform? It's up to us...
Sunday, July 26, 2009
So there was a lot of back-and-forth this week on negotiations around federal health reform. President Obama's original timetable to have bills out of both the House and the Senate by August recess is not going to happen. It was always seen as ambitious, if not unrealistic, so it shouldn't be a surprise if it slipped a bit.
Instead, the new goal in the Senate is to have at least the Senate Finance Committee report out its version of the bill before recess in the next week or two, and then use the August recess to negotiate differences between that bill and the one earlier released by the Senate HELP Committee. That would allow the full Senate to debate the unified bill when they get back in September.
In the House of Representatives, two of committees have done their work, with the House Energy and Commerce Committee remaining. There continue to be negotiations with the "Blue Dogs" on the committee. We'll see if there can be a committee and/or floor vote before the recess.
Even in the most ambitious timetable never had a final health reform bill ready before the recess. The question wasa how far along in the process we would be.
What people are concerned about is not just slowing the process, but opponents using the August recess to organize the opposition. But Kevin Drum at Mother Jones magazine suggests that this is an opportunity as well in the August recess:
..there's more than one way to look at it anyway. The first way is the conventional one: Republicans are hoping that the August recess will slow things down. It gives them more time for attack ads, more time to manufacture uncertainty, and more time to drive wedges between unsteady allies on the pro-reform side.
That's all true. But the main thing that happens during the August recess is that everyone in Washington goes home and talks to people in their district. If their constituents are largely opposed to healthcare reform, it hurts the cause. But if they're pissed off about the status quo and want to know why Congress can't get off its butt and do something — well, that can actually speed things up.
Now, that's not normally what happens. And it won't this time either — unless Barack Obama's army of supporters are still ready to go out and answer the call of reform. I've long been skeptical about whether his famous electoral machine would continue to work after the campaign was over, but if there was ever a time to prove me wrong, it's now. If Obama's army is still willing to go out and do battle, they should show up now and start putting the fear of God into their congressmen. If that happens, the August recess will be the best thing that ever happened to healthcare reform.
I wouldn't bet the farm on that happening. But congressmen listen to their constituents when they go home for the holidays, and there's no reason reform advocates can't use that to their advantage. It all depends on whether we're really as motivated and as angry as the opposition. Are we?
This is a call not just to President Obama's supporters and network, but to anybody who cares about health reform. Here in California, we have 2 Senators and 53 Representatives to urge to get health reform done. That's our challenge, and our opportunity.
The Assembly applauded themselves when they finished their marathon floor session approving a state budget today. The sounds outside the chamber, and outside Sacramento, were not cheers. Here's some reaction from the health community:
From the California Medical Association:
“This is a devastating blow to the swelling ranks of California’s needy, who are struggling to get through the worst economic crisis in a generation,” said Dr. Dev GnanaDev, president of the California Medical Association. “These cuts dramatically increase the long-term health care costs borne by taxpayers, as the patients shut out of these programs now must turn to costly and overcrowded emergency rooms for care.”
“Leaving children without health care is irresponsible – from both a public health and fiscal point of view,” Dr. GnanaDev said. “Unfortunately, this forces many financially strapped families to choose between taking their kids to the doctor or feeding and clothing them. As a trauma surgeon, I see what happens when preventative care is eliminated; it results in more people getting sick and more people going to the ER.”
From Western Center on Law and Poverty:
"The California Legislature has been steamrolled by Governor Schwarzenegger into sacrificing poor families with children for the sake of political expediency. Whether these cuts were agreed to so the state can repay Prop 98 next decade or were agreed to because the Democrats could not stand the Governor's heat doesn't matter. It is shameful, disgraceful and one of the lowest moments in the history of social welfare in California. It is deeply offensive to hear Democratic leadership claim to have "saved the safety net" or that they will undo this in the future. They will never have the votes to restore CalWORKs and they should stop trying to deceive the public about the harm they have done," said Michael Herald, Western Center on Law & Poverty.
“There is a dark cloud over California today. We may be able to pay our bills in the short term but the bill will come due from the budget passed today which will cause human suffering, hunger, and sickness. Hundreds of thousands of children in California will lose health coverage. While other states also facing budget shortfalls are expanding their health programs, we are turning our backs on those in need," said Elizabeth Landsberg, Western Center on Law & Poverty.
From the California Labor Federation
“The state budget package passed today is the shame of California. The deep, unnecessary cuts included in this budget will turn the current economic storm battering families into a Category Five hurricane." said Art Pulaski, Executive Secretary-Treasurer, California Labor Federation.
“With this budget, the Governor and Legislature failed miserably in their primary duty to protect California families. The most painful part of this budget deal is that the catastrophic cuts to education, health care, public safety, state workers and programs for children, seniors and the disabled could have been avoided."
“The refusal by the Governor and Republican leadership to even consider popular revenue sources like a tobacco tax or oil severance fee created the roadmap to the disastrous budget we’re now saddled with. The accounting gimmicks the budget deal includes scuttle any hope of long-term fiscal stability. This is not a budget of shared sacrifice; the hardship falls disproportionately on low- and middle-income families.
“At every turn along the winding road that led to this budget, the Governor sided with wealthy special interests at the expense of working families. When given the choice to support a tobacco tax or eliminate children’s health care, he sided with Big Tobacco. When given the choice to lay off thousands of teachers, firefighters and police or tax Big Oil, he sided with Big Oil. When given the choice to close corporate tax loopholes or gut job-creating infrastructure projects, he sided with wealthy corporations.
“It’s never been clearer that our system needs reform. We need to eliminate the ludicrous two-thirds majority rule that allows a small minority of ideologues to hold the state budget hostage to their narrow demands. We need to fix the state’s outdated tax system to ensure that the wealthy and corporations pay their fair share. And we need new sources of revenue to ensure important programs in education, health care and other areas are adequately funded.
From Children's Defense Fund:
“While legislators speak about a budget that “shares the pain” they have chosen to abandon the next generation. Low income children who turn age six and would normally be enrolled in the healthy families program will be placed on a waiting list for health coverage." said Deena Lahn of the Children's Defense Fund of California.
"Elementary school students who benefited from a low student teacher ratio will have larger classrooms and less time to learn. Children and families who have received minimal cash assistance will have a greater likelihood of being homeless. Youth who expected reasonably priced and high quality higher education in the CSU system will be out of luck."
"Legislators agreed to all this and more to avoid doing anything on revenues, including closing corporate tax loopholes or imposing an oil severance fee.”
From Health Access California:
"This budget is a tragedy for all Californians." said Anthony Wright, executive director, Health Access California, the statewide health care consumer advocacy coalition. "For low-income children, pregnant women, or Californians of all incomes denied private insurance at any price due to pre-existing conditions, these legislators have closed the door to their last and only option for health care coverage."
"This budget shreds our state's safety net. As with other programs, Healthy Families will exist in name, but be a shadow of its former self, shuttered and actively kicking kids off coverage. Someone should ask the hundreds of thousands of families of those children who will be denied health care coverage about the state of our safety net," said Wright.
"California has better choices than to deny coverage to hundreds of thousands of children, or to make these devastating cuts to the health system on which we all rely," said Wright. "While there were no good choices in this budget crisis, these were the worst possible choices for our children, for our health system, and for our economy. The agreement of a budget like this is not a cause of celebration, but of embarrassment and shame for California." said Wright.
President Obama's press conference, if anything, was designed to cut through the clutter and answer the simple question: Why health reform? He put it in the context of economic recovery, and or long-term deficit reduction, of the state of our health system, but ultimately he made the direct pitch about how it will benefit the average American--the voter.
This is not just about the 47 million Americans who don't have any health insurance at all. Reform is about every American who has ever feared that they may lose their coverage, if they become too sick or lose their job or change their job.
It's about every small business that has been forced to lay off employees or cut back on their coverage, because it became too expensive. It's about the fact that the biggest driving force behind our federal deficit is the skyrocketing cost of Medicare and Medicaid.
So let me be clear. If we do not control these costs, we will not be able to control our deficit. If we do not reform health care, your premiums and out-of-pocket costs will continue to skyrocket.
If we don't act, 14,000 Americans will continue to lose their health insurance every single day. These are the consequences of inaction. These are the stakes of the debate that we're having right now. I realize that with all the charges and criticisms that are being thrown around in Washington, a lot of Americans may be wondering: What's in this for me? How does my family stand to benefit from health-insurance reform?
If you have health insurance, the reform we're proposing will provide you with more security and more stability. It will keep government out of health care decisions, giving you the option to keep your insurance if you're happy with it. It'll prevent insurance companies from dropping your coverage if you get too sick. It will give you the security of knowing that if you lose your job, if you move, or if you change your job, you'll still be able to have coverage.
It will limit the amount your insurance company can force you to pay for your medical costs out of your own pocket. And it will cover preventive care, like check-ups and mammograms, that save lives and money.
Now, if you don't have health insurance, or you're a small business looking to cover your employees, you'll be able to choose a quality affordable health plan through a health insurance exchange, in a marketplace that promotes choice and competition
And finally, no insurance company will be allowed to deny you coverage because of a preexisting medical condition.
It's a strong argument. Hopefully it won't be obscured by all the race horse coverage about the political horserace (rather than the substantic policy issues).
The Governor's office came out with a new publicity document today extolling the "reforms" that they won.
It's kind of shocking that the first thing on that list of "reforms" is stopping cost-of-living adjustments (COLAs) indefinitely, for low-income children and families on CalWORKS, higher education, the judiciary, corrections, etc. As if there's no such thing as inflation. How is that "reform?"
On health care issues, here's what the Governor says is in the agreement:
Better Care Coordination in Medi-Cal and Centralizing Eligibility
Due to greater utilization of services, increased costs in the health care system and more individuals becoming eligible for services, Medi-Cal has been growing at a rate of approximately 8 percent per year. Since 2004, the Governor has been clear that without fundamental reforms, Medi-Cal is not sustainable. The Governor’s reforms will modernize the enrollment system and improve care coordination so that Medi-Cal will be better grounded to continue serving low-income, vulnerable Californians.
Reforms to Medi-Cal:
o Better care coordination for reduced costs. Slow the Medi-Cal growth rate by providing better care coordination for the various populations receiving Medi-Cal services. Authority would include mandatory enrollment into an organized system of care like a medical home model, enhanced primary care case management or managed care for seniors and persons with disabilities, those covered by both Medicare and Medi-Cal, children with significant medical needs, and a better integration of physical and behavioral health services.
o Centralized and modernized eligibility: Centralize and competitively procure enrollment functions instead of having each county make determinations. This would take an antiquated pen-and-paper system with 27,000 employees scattered through 58 counties and bring it into the 21st century. This proposal would include the eligibility process for CalWORKs, Medi-Cal and Food Stamps.
Savings: $1.8 billion in 2012-13.
Both issues are dubious in terms of the savings that can be achieved, and whether it will improve the situation for Medi-Cal patients. There are long-standing concerns about mandatory managed care for seniors and people with disabilities on Medi-Cal, both for the patients and for the health system. The privatization of eligibility work has generally been a failed experiment in other states, costing more and making it harder for people to get the coverage and services they need.
Maybe the proposals look better when we get more information. Maybe not.
THE CURRENT BUDGET DEAL (AS WE UNDERSTAND IT): After weeks of negotiating between the Governor and legislative leaders, the current $26.5 billion package of budget “solutions” includes $15.5 billion in cuts, $2 billion to health and human services, including significant cuts to CalWORKS, IHSS, and other social service programs.
On health care, the most notable cuts include:
* Denying hundreds of thousands of children health coverage. The Healthy Families program current covers nearly one million low-income children between 100-250% of the federal poverty level. The proposed cut of $144 million in state dollars (well above the recommendation of the Budget Conference Committee) would deny well over 500,000 children coverage. First, the newly-imposed wait list would deny over 350,000 children over the course of the budget year. Second, the size of cut would force California to actively disenroll hundreds of thousands additional children. For every dollar we cut in Healthy Families, we are losing two dollars in federal matching funds for our health system, and our economy.
* Making severe cuts to preventative and core health programs. While rejecting outright eliminations, the Budget Conference Committee made drastic cuts to a series of health care programs and services. We understand the current budget deal increased the cut to Healthy Families, but have not heard of other changes.
Assuming that the budget deal adopted the Budget Conference Committee reductions without significant changes, the deal includes: o Cutting mental health, including reducing by $92 million of funds for the Mental Health Managed Care Services, and the Early and Periodic Screening, Diagnosis and Treatment program. A $14 million cut would eliminate state money for ancillary health services in Institutions for Mental Disease. o Cutting HIV/AIDS care, reducing funding by $33.5 million o Cutting Adult Day Health Care, limiting it three days a week and other changes, a $26.8 million cut
o Cutting hospital funds, taking $23 million from the Distressed Hospital Fund o Cutting community clinics, including many funding streams by around 30%, including Rural Health Services by $2.2 million; Seasonal Migratory Worker services by $1.9 million, Indian Health Program by $1.5 million, and Expanded Access to Primary Care by $8.4 million. o Cutting maternal and child health care by $11.5 million, including the Black Infant Health Program by nearly $1 million; Adolescent Family Life Program by $1.75 million, local county maternal and child health grants by $2.1 million, and maternal and child health state support by $3.5 million.
o Cutting last-option health coverage for those rejected for “pre-existing conditions”, reducing the Major Risk Medical Insurance Program by $6.6 million. MRMIP already has a waiting list, with 7,100 enrollees, despite estimates of over 400,000 eligible “uninsurables.” o Cutting health coverage for mothers and newborns babies to get prenatal and post-natal care, reducing the Access for Infants and Mother program by $4.9 million. The cut would force a waiting list.
o Cutting all of the Immunization Program, for $18 million o Cutting community application assisters that help enrollment in public coverage like Medi-Cal and Healthy Families, for $3 million o Suspending a children’s dental disease prevention program, for $3 million
* Advancing a controversial proposal to privatize county eligibility workers for Medi-Cal and other human services. As reported in the media, the legislative leaders agreed to a process to consider the Governor’s recent proposal to privatize and replace the current county workers who assist Californians enrolling in Medi-Cal and other social services with a private contractor like Maximus or Halliburton. The reports indicate that the consideration would allow stakeholders to vet the proposal and requires legislative approval.
* Advancing a proposal that may mandate managed care for seniors and disabilities on Medi-Cal. Consumer advocates have been long concerned about the impact on patients and their access to care and specialists, as well as funding impacts to safety-net institutions. The reports indicate that the proposal would allow stakeholders to vet the proposal and requires legislative approval.
It’s important to note that these and other cuts that are revealed as part of the current budget deal are on top of the cuts made in February 2009. Those cuts included the elimination of 10 benefits, including dental coverage, for the nearly 3 million adults (parents, seniors, and people with disabilities) with Medi-Cal coverage. Those went into effect recently on July 1, 2009.
We will continue to monitor the situation and see what other information is released.
In all the analyses of the California health reform, there's been a lot of talk about all sorts of issues. But I think an overlooked issue was one of trust.
When Senate Majority Leader John Burton--a legendary figure and now chair of the California Democratic Party--ran his health reform, SB2, an expansion of employer-based coverage in 2003, he pushed it through his power and personality. And while he and various stakeholders worked very hard on the details, he was able to push a product to legislative passage and a Governor's signature with support of many groups first of all because they trusted him. They trusted where he was coming from, what his intent was, and even his ability to fix something if it didn't work out as intended.
Health policy can get pretty complicated, and many people can be concerned about the potential impacts of any changes, and so trust of the authors can go a long way in providing the benefit of the doubt.
Ezra Klein reports about a phone call by President Barack Obama had with bloggers today where he details his desire to move the process forward, and get a bill--even one that doesn't do all that we want--through the House and Senate, so that we have the opportunity to influence the content in conference committee. As Ezra indicates, this is both a plea to not make the perfect the enemy of the good, but a plea for trust, that the President will work to make the final bill a good one, either in conference committee (and maybe in implementation). He may very well have that trust with the public, and perhaps with various stakeholders that are the base of a health reform effort.
In Massachusetts, there didn't seem to be too much trust with Governor Romney by health advocates or the Democratic legislature. But they didn't need to do so. He was a lame duck, and would not be around to implement the program. From afar, my sense is that they might have been more concerned about the details of the bill if they thought he would be the one carrying out the proposal.
In California in 2007, that trust was not there. Governor Schwarzenegger was enthused about health reform, but had gone through several transformations in his few years in Sacramento (as he has continued), and always seemed to relish the spotlight/limelight rather than the issue itself. He used his trust he built to get support from some business and Chamber of Commerce types, but he didn't have it with the core health reform stakeholders. Folks were understandably skittish about what his implementation would look like.
The term-limited legislative leaders did not have the same built up history and relationaships as Burton, and had their own fights with their "base" constituency--with components of labor, for example, that made that mutual trust hard. Some who were predisposed not to trust the legislative leaders pointed to the term limits ballot measure, concerned that that was the major motivator rather than the issue at hand. (Somewhat unfairly, I would say). The lack of trust made people look a second time at legislative language, looking for problems that may or may not be there. This is not to say that a second look isn't warranted. The issue is whether there is that trust in the first place.
In the present context, we should fight as hard as possible to get the House and Senate bills to be as strong as possible, to help create the best debate parameters within the Conference Committee. But it also means that we need the trust people have in President Obama to help us through.
So trust matters. Even when I did a post-mortem of California health reform, I downplayed trust because it is hard to extrapolate a tangible lesson for the future--after all, trust is not something that can be bought, but comes with time and experience. But I think that trust--whether of Representative Waxman, of Senator Kennedy, or of President Obama--will be a overlooked factor in whether health reform succeeds or not.
My colleague Mike Herald of Western Center on Law and Poverty and I appear in this ABC local news segment on the budget crisis, and the changing of our safety net.
I most object to the comment of the so-called taxpayer advocate, who apparently doesn't want a good value for his (or my) taxes. He seems to think California's safety-net was generous. It certainly has never been at the same place at New York or other major states.
And in health care, let's remember that before this crisis, California was 51st in the nation in per patient Medi-Cal spending. That's before the crisis, before we eliminated dental and other Medi-Cal benefits, for example. Or before we make the cuts proposed in this budget.
It's clear that Republican legislators and others who backed full elimination of Healthy Families and other programs, have different priorities for California, and a different sense of what a safety-net should provide. That will be an ongoing debate after this budget is full implemented
On July 1, nearly 3 million Californians--mostly low-income parents, seniors, and people with disabilities--lost ten key benefits in their Medi-Cal coverage. The biggest concern is dental coverage, which over 900,000 of these patients use in a given year. Other benefits these patients lost include podiatry, optometry, psychology, and speech therapy.
All of these cuts are foolish: Dental coverage allows for better nutrition and prevents emergency room visits. Podiatry is an early warning signal for diabetes, etc. But these decisions don’t even meet the “penny-wise” cliché. In addition to being cuts to preventative care, the state is losing $1.60 in federal matching funds for every dollar we cut, impacting our health system, and our economy.
And while those cuts focus on all adults on California’s safety-net programs, the children have not been spared. Far from it. Governor Arnold Schwarzenegger has proposed fully eliminating Healthy Families, California’s version of the state Child Health Insurance Program that covers nearly one million children.
Last Friday, July 17th, the board that runs Healthy Families closed enrollment, both to new applicants and even to those who are shifted from other state programs. Children on Medi-Cal coverage turning one or six-years-old in certain income categories will get a birthday gift of losing their health insurance. It is estimated that over 350,000 low-income children will be frozen out of health coverage and placed on a waiting list in the next year.
The news today is even worse: the cuts that legislative leaders just agreed to as an alternative to full elimination would force the program not just to impose a wait list, but also to actively dis-enroll hundreds of thousands more children from coverage. The consequences will be kids not getting glasses to see the blackboard, missing school for toothaches, and otherwise delaying care. One ailment or accident on the playground would put families at risk of financial ruin, and needed care will be delayed or avoided altogether. Children’s and other community groups don’t mince words when they say that cuts at this scale mean kids will die.
The Legislature will vote later this week on the Healthy Families cut and many other shameful cuts to health care--as well as education, human services for our most vulnerable, and the other functions of state budget. The Governor and legislative leaders should reconsider these tragic choices.
...I also think California’s seventh-worst uninsured rate in the nation contributes to the environment that allows such cuts to be even considered. After all, with several hundreds of thousands of uninsured children already, what’s hundreds of thousands more?
And that’s a notion that needs to fundamentally change with health reform.
In the context of a near-universal system, federal health reform would set a floor to prevent such cuts. Now, the number of children covered is arbitrary, and while policymakers may feel its nice to cover as many children as possible, it's not an imperative. Also during a budget crisis, federal health refrom provide the federal resources to meet these commitments that states may find it impossible, especially in bad budget times.
Its imperative that we work at both levels, at the state level to defend what we can and prevent the worst, while organizing for the best, with the potential of comprehensive health reform that might save us from ourselves.
The article is very helpful is giving specific impacts, both for Healthy Families, but two other programs, MRMIP and AIM, that are also subject to cuts. (Emphasis added):
Budget cuts are expected to be deep at the state agency that operates the Healthy Families program, said Ginny Puddefoot, spokeswoman for the Managed Risk Medical Insurance Board.
She said the state would cut $124 million from the agency's budget, on top of a $20-million shortfall it already has. Given that the federal government kicks in $2 for each dollar the state spends on the program, agency officials are looking at a $432-million hole in the coming fiscal year.
"Our budget last year was about $1.2 billion," she said. "So it [the new budget cut] has a huge impact on children."
At the end of June, when the insurance board was forecasting a $70-million cut from the state, along with the $20-million shortfall, it voted to freeze new enrollment. The freeze, which took effect July 17, will prevent more than 350,000 children from entering the program and stabilize enrollment at about 592,000 children by the end of June 2010, according to estimates. There are currently about 920,000 children enrolled.
But Puddefoot said the new budget deal will likely force them to take the additional step of actively taking children off the rolls when they come up for their annual re-enrollment, unless the agency can find additional funding. Those children will then be put on a waiting list, which has been frozen.
"We've done different scenarios based on assumptions, but our estimates at the end of June found that between 160,000 and 288,000 would need to be disenrolled throughout the year," she said...
Puddefoot said there also will be cuts affecting two other smaller programs the board oversees: the Major Medical Risk Insurance Program and Access for Infants and Mothers. The former provides insurance to people who are "medically uninsurable" and have been turned down by private insurance companies because of pre-existing conditions. Enrollment will have to be capped at its current 7,100. There are probably 400,000 people in the state who need the program but the agency cannot accept any more clients, Puddefoot said. Officials estimate the budget will be cut by $6 million.
Access for Infants and Mothers provides medical care for pregnant mothers and babies 30 days after delivery for women whose income is too high to qualify for Medi-Cal but who cannot afford private insurance. Officials will likely have to stop enrollment Jan. 1 because of a probable multimillion-dollar cut to the program.
So our initial projection that over a half-million children will be denied health care coverage is a conservative estimate, and it could be much more. The number of children with Healthy Families coverage could go from around 1 million to just around 300,000.
The other MRMIB programs also are not spared, and those cuts are tragic in their own right. There is no justification to cut pre-natal and post-natal care, which is well documented in having lifelong health impacts.
The cut to the state's high-risk pool, MRMIP, is a signal that these cuts are not just a shredding of the safety net for the poor. This program provides some basic coverage to those, because of "pre-existing conditions," who are denied private health at any price. The premiums in MRMIP are not cheap, but the typically middle-income folks on the program find it is their only alternative.
So this budget leaves us with a shadow of the safety net, the safety net that any of us might need, whether because of accident or emergency.
We are trying to get more information about the specifics of the budget deal for health care, beyond the shockingly large cut to the Healthy Families program, that would deny coverage to *well* over 500,000 children in the next year.
State leaders agreed to develop a controversial plan that would centralize the enrollment of welfare and social service programs, possibly with a $2 billion annual contract with a private firm to run the system. Schwarzenegger has proposed the idea as a way to increase efficiency, but Democrats have warned that other states who privatized their enrollment systems have suffered higher costs and enrollment problems. Legislative aides said Monday that they agreed to explore a system that allows stakeholders to vet the proposal and requires legislative approval.
We understand there's a similar agreement about a proposal and process around mandatory Medi-Cal managed care for the "aged, blind, and disabled"--a longstanding and controversial issue. We'll get more information when we can.
C-SPAN has been showing the committee discussion, which includes several California members, including Democratic Representatives Waxman, Anna Eshoo, Lois Capps, Jane Harman, Doris Matsui, Jerry McNerney, as well as Republicans George Radanovich and Mary Bono Mack.
Reports of a budget deal, and $15 billion in cuts, are not a time for celebration. Certainly not when the cuts include severe cuts to health care, including coverage for children.
The cuts to Healthy Families, for example, go well beyond the $90 million cut decided by the Budget Conference Committee. The New York Times suggests it will be a $144 million cut, $53 million more than the previous cut.
California has better choices than to deny coverage to hundreds of thousands of children, or to make these devastating cuts to the health system on which we all rely. While there were no good choices in this budget crisis, these were the worst possible choices for our children, for our health system, and for our economy.
Millions of Californians will live sicker and die younger as a result of these cuts. These budget cuts reflects choices, and it is sad that our policymakers chose to cut off millions of Californians from basic care, rather than finding the revenues needed to maintain these needed services. It should be shocking that our policymakers are making the choice to deny coverage to hundreds of thousands of children, and the only debate was how many."
These cuts are magnified because of the hundreds of millions in lost federal matching funds we need for an economic recovery. These cuts will not just directly impact hundreds of thousands of children and many of California’s most vulnerable, but they will ripple through the health care system and impact all Californians as a result. The agreement of a budget like this is not a cause of celebration, but of embarrassment and shame for California.
President Obama makes the case for health reform, and rebuts the critics he knows are coming.
The House Ways and Means Committee, chaired by California Congressman Henry Waxman, will restart their review of H.R. 3200 at 1:00pm Pacific on Monday, and work Monday, Tuesday, and Wednesday. President Obama holds a Wednesday prime time press conference on health reform issues. The press is on...
"Embarassing" was a frequent comment I heard when I was in DC earlier this week, made by various legislative staff of California lawmakers. The subject was the new waiting list, reported by the Sacramento Bee (source of the photo) and elsewhere, in Healthy Families program which has begun denying children the health coverage they need.
Our delegation worked really hard to pass the reauthorization of the state Child Health Insurance Program--which provides 2/3 of the funding for Healthy Families--and to make sure that the reauthorization was favorable for California. And now, that work may be for naught--given the Governor's proposal to end the program altogether, and even the likelihood that we would freeze enrollment and leave hundreds of millions of federal dollars back in DC.
Even in bad economic times, there are choices. And the shameful decision of California leaders, starting with Governor Schwarzenegger, is in stark contrast to many other states.
Despite budgets ravaged by the recession, at least 13 states have invested millions of dollars this year to cover 250,000 more children with subsidized government health insurance.
The expansions have come in the five months since Congress and President Obama used the reauthorization of the Children’s Health Insurance Program to vastly increase its funding and encourage states to increase enrollment. Although the federal government covers the vast majority of the cost, states set their own eligibility levels and must decide whether to spend state money in order to draw even more from Washington.
The states’ willingness to spend, even under excruciating budget pressures, is a measure of the support for expanding health care coverage to the uninsured as Congress and the administration intensify their negotiations over a new federal health care bill.
But a number of states decided that their depleted coffers did not allow them to insure additional children, even as a minority partner.
...in California, where Democratic legislators and Gov. Arnold Schwarzenegger, a Republican, are struggling to close the country’s largest budget gap, the state on Friday imposed a freeze on new enrollments.
California officials estimate that up to 350,000 eligible children may be relegated to a waiting list, and that attrition could lower enrollment by 250,000 by June. If money is not found, the losses there might overwhelm the cumulative gains in other states.
Health and Human Services Secretary Kathleen Sebelius said the potential for major reductions in California was “a huge concern.”
But over all, she said, the Obama administration was “very pleased that even in what are some of the worst budget times in a very long time, children’s health insurance continues to be an absolute top priority.”
The Children’s Health Insurance Program, known as CHIP, has been politically popular since its enactment in 1997 because it primarily benefits working families that earn too much to qualify for Medicaid but too little to afford private insurance.
In many states, eligibility expansions have passed with solid bipartisan support. In one of her final acts as governor of Kansas in April, Ms. Sebelius, a Democrat, signed a two-year expansion worth $4.4 million that had been approved by her overwhelmingly Republican Legislature...
Forty-eight states faced budget shortfalls this year, totaling $121.2 billion, according to the National Conference of State Legislatures. But in those that have managed to expand eligibility, governors and legislators said they viewed CHIP as a cost-effective investment.
“In a downturn, the number of people who need the safety net increases,” said Gov. Bill Ritter Jr. of Colorado, a Democrat, whose state levied $600 million in fees on hospitals, some of which will be used to cover an additional 21,000 children.
In Alabama, Democratic legislators overrode the veto of Gov. Bob Riley, a Republican, to extend coverage to 14,000 children at an additional cost to the state of $8 million.“Our economy is tough here,” said State Senator Roger H. Bedford Jr., a Democrat. “But our decision was to fund the health care needs of our children because a healthy child learns better and they don’t show up at the emergency room needing acute care.”
Other states expanding eligibility include Arkansas, Indiana, Iowa, Montana, Nebraska, North Dakota, Oklahoma, Oregon and West Virginia. Ohio passed a budget last week that includes an expansion, but its financing depends on the resolution of a court case.
Illinois, New York and Wisconsin, which had been paying for expansions with state money, are now applying for federal matching funds. And many states are enacting measures to make it easier for children to enroll and stay enrolled, steps encouraged by the federal legislation. Officials in those states and others said they had little choice but to leave federal money on the table.
In California, the Legislature beat back Mr. Schwarzenegger’s proposal to eliminate CHIP altogether but seems to have accepted the enrollment freeze.
“It is heartbreaking,” said Ginny S. Puddefoot, deputy director of the agency that administers the program there. “For those of us involved with children’s health care, this is just something we never imagined we would see.”
California's financial woes are bigger than most, but these other states have their own fiscal crises as well. And yet they are deciding where their priorities are. And right now, for children and health care, Alabama has better priorities than California.
With the passage this week of health reform H.R. 3200 in the House Ways and Means and House Education and Labor Committee early today, and the passage of another bill from the Senate Health, Education, Labor, and Pensions (HELP) Committee on Wednesday, health reform has now passed three of the five relevant committees.
Chairman Miller talked about the importance of the vote:
Floor votes are one committee away in both chambers: the House Energy and Commerce Committee in the House, and the Senate Finance Committee in the Senate.
Even though this is historic--this is the farthest that health reform has ever gotten at the federal level--President Barack Obama has a press conference today to be clear that he wasn't satisfied: he is seeking full passage of health reform this year.
In attacking the federal health proposals, Republicans have offered amendments to build a case against it. Some of the amendments would suspend the reform if waiting times go up, or if the proposal falls out of balance for even a year. The Democrats reject these amendments, easily arguing that it makes no sense, if some provisions need to be fixed or adjustments need to be made, to penalize people by taking away their health coverage.
Another amendment was to force members of Congress to get their coverage from the public health insurance option.
The House Committee on Ways and Means just passed H.R. 3200, the America’s Affordable Health Choices Act of 2009, by a vote of 23-18. The bill will cover 97 percent of Americans, according to CBO.
“Today’s vote is another historic step toward enacting health care reform this year,” said Health Subcommittee Chairman Pete Stark of California. “I look forward reconciling our changes with the other committees, and voting on the floor of the House to provide affordable, quality health care to all Americans.” Click here to view Chairman Stark’s opening statement.
The provisions will be merged with provisions currently under consideration in the Committees on Energy and Commerce and Education and Labor for consideration by the full House of Representatives in the coming weeks.
There are lots of other Californians on this Committee, including Democrats Woolsey and Dave, and Republicans McKeon, Hunter and McClintock, all who have been active in the amendment process.
Both this committee, and the Ways and Means Committee, are expected to vote out their parts of the bill in the next day or so.
There is more consideration, through early next week--and more drama--at the U.S. House Energy and Commerce Committee, chaired by California Rep. Henry Waxman. The Committee has enough conservative "Blue Dog" members that they may force changes to the bill. Stay tuned...
The Good News: With the fate of California's Healthy Families hanging in the balance, First 5 California passed a resolution yesterday that provided broad authority for the Commission to continue financial support for health coverage for kids.
The resolution did not allocate a specific dollar amount, but indicated they would help with the $90 million shortfall that Healthy Families would have under the Budget Conference Committee proposal. We'll know how big the hole is when the state budget is signed by the Governor. It is unclear whether First Five would--or is even able to--bridge the entire shortfall, however big it is. Additional financial commitments from other stakeholders were encouraged at the meeting.
First 5 California's commitment cannot be the only solution. The Legislature and Governor must also stand up for the most vulnerable children in California by funding the Healthy Families Program.
The Bad News: Unless there is a change, children will be denied health coverage starting TOMORROW, July 17th, and placed on a waiting list. The freeze will take place with the implementation of a waitlist to new enrollment in the Healthy Families program.
The Managed Risk Medical Insurance Board (MRMIB) determined this during their meeting on June 29, 2009, where they disclosed that sufficient funds are not available to cover the estimated costs of Healthy Families expenditures.
Unless there's a change, it'll be a sad day tomorrow.
SENATE COMMITTEES PASS INSURANCE REFORMS * Key Measures from Assembly Pass Senate Health & Judiciary Committees * Bills Included AB786(Jones) to Better Label Insurance Plans, Limit Out-of-Pocket Costs * Trio of Insurer Oversight Bills Focus on Controversial Rescission Practices * Next Stop: Senate Appropriations Committee for Fiscal Review, then to Senate Floor
* More Updates on blog.health-access.org: Senate HELP Passes Bill; House Bill Unveiled; Even Wall Street Agrees on the Broken Health System; California Blue Dogs on Health Reform and the Public Health Insurance Option; Health Reform Blog Updates; Kids Will Die; Budget Protests; Myths and Facts on the Governor's "Reform" of Medi-Cal Eligibility
SACRAMENTO – The Senate Health Committee, chaired by Sen. Elaine Alquist (D), and the Senate Judiciary Committee, chaired by Sen. Ellen Corbett, supported important health care consumer protections in the past two days. These and other bills will be going to the Senate Appropriations Committee, before going to Senate floor for a full vote.
HEALTH COMMITTEE ON INSURANCE REFORM: The bills included AB786 by Assemblyman Dave Jones (D), which aims to better label the insurance products sold to individuals, limit out-of-pocket costs, and ultimately help Californians avoid being sold “junk insurance” policies. Jones told committee members the bill, sponsored by Health Access, was critical to helping consumers know exactly what kind of coverage they are getting when they pay for an individual health care plan.
An increasing number of California consumers are being forced into the individual policy market as they lose employer-sponsored or group coverage in the state’s lingering economic downturn.
Thus, it is more crucial than ever that insurers represent policy features with more clarity and transparency regarding what health care procedures will be covered, and what portion of the medical debt will be shouldered by the consumer.
AB786 would institute a tiered system of defining the various benefits levels individual policies offer, allowing consumers to comparison shop in an “apples to apples” manner.
Currently, it is very difficult for consumers to obtain clear and accurate information about what their individual policies cover, and what they do not. This has left many consumers surprised by huge medical bills that they believed were covered by the policy they pay premiums on.
Martha Yvonne Fadlin, of San Jose , testified in support of AB 786. Fadlin, a 62-year-old licensed vocational nurse turned to the individual market for coverage when her job was down-sized from full time to part time and she no longer had her employer-provided insurance.
Fadlin said she shopped around, and researched plans by Blue Cross, Blue Shield and Kaiser. She ended up buying an individual policy from MultiPlan, whose ads she saw on television and seemed cheaper.
Although the health plan she bought claimed to cover hospitalization, emergency room visits, X-rays and other diagnostic tests, it was less than forthcoming with information telling her how much of those health care services it would cover in exchange for her $268 premium.
When Fadlin went to the doctor for severe abdominal pain, it was determined she should go to the hospital. Tests showed she suffered from diverticulitis and she went home with a prescription to help with her condition.
Her bill? Ten thousand dollars, of which MultiPlan paid only $2,000. She now owes a hospital bill of $8,000.
“It never occurred to me that an insurance company could say it covered something but only pay a tiny fraction of the cost,” she told committee members.
Speaking in support of the bill was Health Access California, Western Center for Law and Poverty, Congress of California Seniors, California Immigrant Policy Center, California Teachers Association, Californians for Disability Rights, California Alliance for Retired Americans, Jericho, and the American College of OBGYNs . AB 786 would also impose a maximum $10,000 out of pocket obligation for the policy holder and would standardize terms and definitions of coverage.
Testifying in opposition were Anthem Blue Cross, Health Net, the California Association of Health Plans, other insurers and a representative of agents and brokers who predicted that categorizing insurance policies in 10 tiers would be too difficult because he, for example, sells 136 types of individual insurance products.
Another key consumer protection bill that passed the Senate Health Committee Wednesday was AB244 by Assemblyman Jim Beall (D). AB244 would require mental health care parity for adults and youths for a range of mental and substance abuse disorders that benefit from treatment.
TUESDAY'S JUDICIARY COMMITTEE ACTIONS: This is the final week for policy committees to approve Assembly bills on their path through the Senate On Tuesday, the Senate Judiciary Committee, chaired by Ellen Corbett (D), passed three key pieces of legislation designed to combat the insurance industry’s practice of retroactively rescinding health care coverage for consumers who undergo costly medical care. Votes were along party lines.
The trio of insurance company oversight bills, supported by Health Access California , are:
* AB2, by De La Torre (D) and supported by the California Medical Association and other physician groups, would ensure an independent third party reviews all insurance company rescissions. Thus, the bill also raises the standard that insurance companies must meet before retroactively cancelling health care coverage of a consumer with an individual policy. Currently, health care plans yank coverage without any prior approval. If AB2 passes and becomes law, insurance companies will have to prove the customer willfully misrepresented his or her medical history to get coverage. AB2 also will require insurance companies to develop and use standardized, clear and easy-to-understand application questionnaires for consumers applying for a health care policy. Representatives of large health plans, including Anthem Blue Cross and Health Net, were joined by the California Chamber of Commerce in opposing the bill. Industry spokespersons did, however, concede that independent review of rescissions, which have targeted thousands of Californians in the past few years, could be acceptable--depending on the rules of the independent reviewer used--as was developing standardized, understandable application materials.
* AB730, also by De La Torre, was sponsored by the California Department of Insurance, which regulates the individual policy market. The legislation would increase penalties for wrongful rescission from $118 to $5.000- $10,000, closer to the level of fines the Department of Managed Care is able to use in its regulation of managed care insurers of group policies. Fines are levied in cases where an insurer is found to have unlawfully engaged in post-claims medical underwriting – or investigating a patient’s history only after the patient has undergone expensive medical care. Industry representatives said they were not opposed to increasing the fines from $118 per case, which Assemblyman Hector De La Torre said was too low, and “hardly a disincentive” to insurers.
* AB108, by Assemblywoman Mary Hayashi (D), would cap at 18 months the length of time an insurer has to rescind, cancel, or limit individual health care policies – or charge higher premiums – because of fraud by a consumer. The bill would reduce from 24 months to 18 months the window of opportunity for insurers to take action against a consumer who knowingly misrepresented their medical issues in order to obtain coverage.
This was a milestone vote. After considering over 500 amendments and accepting 170 Republican amendments, the Senate HELP Committee passed out a detailed bill, one that Senator Dodd, acting chairman, described as a "bipartisan effort," if not a biparisan bill. He referenced Senator Kennedy, the chairman, saying "he was here in spirit. He was very excited that his committee was the first committee to pass a bill."
This bill goes to the floor, but it will need to be melded by what is passed by the Senate Finance Committee, chaired by Senator Max Baucus. One of the many questions is how quickly that can be done.
We'll have more about the actual substance of the bill, but the momentum is heartening.
For decades, Washington failed to act as health care costs continued to rise, crushing businesses and families and placing an unsustainable burden on governments. But today, key committees in the House of Representatives have engaged in unprecedented cooperation to produce a health care reform proposal that will lower costs, provide better care for patients, and ensure fair treatment of consumers by the insurance industry.
This proposal controls the skyrocketing cost of health care by rooting out waste and fraud and promoting quality and accountability. Its savings of more than $500 billion over 10 years will strengthen Medicare and contribute to our goal of reforming health care in a fiscally responsible way. It will change the incentives in our health care system so that Americans can receive the best care, not the most expensive care. And it will offer families and businesses more choices and more affordable health care.
This proposal will also prevent insurance companies from denying people coverage because of a pre-existing medical condition. It will ensure that workers can still have health insurance if they lose their job, change their job or start a new business. And it includes a health insurance exchange that will allow families and small businesses to compare prices and quality so they can choose the health care plan that best suits their needs. Among the choices that would be available in the exchange would be a public health insurance option that would make health care affordable by increasing competition, providing more choices, and keeping the insurance companies honest.
The House proposal will begin the process of fixing what’s broken about our health care system, reducing costs for all, building on what works, and covering an estimated 97% of all Americans. And by emphasizing prevention and wellness, it will also help improve the quality of health care for every American.
I thank Chairmen Rangel, Waxman, and Miller for their hard work on this bill that fundamentally reforms the health care system. As this process moves forward, I look forward to continuing to work with all House members in ensuring this legislation helps all Americans and plays an essential role in reducing deficits and bringing fiscal sustainability to our nation.
Wall Street’s analysts met with health care policy wonks in Washington July 8 for a conference organized by the Center for Studying Health System Change, which was funded by the Robert Wood Johnson Foundation.
An industry newsletter called Healthcare BS reports that everyone agreed the flawed health care system is costing too much of our economic resources – estimated at 16.7 % of gross domestic product.
Here are some of the findings on dollars-and-cents issues:
“Cost trends have ticked up, and so pricing is up about 1% on average in the individual and small-group market in 2009. This means higher deductibles and out-of-pocket costs -- all of which are expected to filter into the large-group market this year as employers set their benefits for 2010.”
"Premium increases and benefit changes stem from two primary causes: medical spending inflation and cost shifting, panelists said. As hospitals’ payments from government insurance plans are cut, they pass along more costs to private insurance carriers, and in turn, employers are passing along their cost increases to their employees in higher premium contributions, copays and out-of-pocket maximums."
"The analysts noted that insurance brokers generally earn hefty commissions of between 20% and 25% of the premium in the first year and then half that amount in each renewal year, adding substantially to the cost of individual insurance. "
"At the end of the day, everyone expressed a sincere desire to see the creation of an integrated health care delivery system that provides better care to more people at lower costs."
There was a lot of concern about a letter by "Blue Dog" Democrats sent last this week that expressed concerns about health reform, from the costs to the impact on business to the creation of a public health insurance option.
A testament to the urgency for health reform and the good organzing here in our state, only one of seven Blue Dogs from California signed the letter: Representative Jim Costa of the Central Valley. In a previous statement expressing concern with the public health insurance option by the Blue Dogs, several of the California delegation actively worked to distance themselves, and they came out in support of the plan.
Where are our Blue Dogs now? Here's two video clips:
Here's California Representative Loretta Sanchez, in her own words, talking on MSNBC:
Here's California Representative Adam Schiff, in his own words, in the last third of this clip from the Ed Show on MSNBC:
He took the above photo, of California Congressman Xavier Becerra--and a key leader in the House of Representatives--speaking at the HCAN Rally on June 25th, and the photo to the left of me, arms draped with the California flag, as I reviewed with coalition members the multiple Congressional visits we did that day.
There's definitely a lot going on. Tomorrow or Monday, the House leadership is expected to unveil its full proposal, including financing and CBO scoring.
SENATE HEALTH COMMITTEE PASSES CONSUMER PROTECTIONS * Key Measures from Assembly Pass Senate Health, Head to Additional Committees * Insurer Oversight Bills Focus on Rescissions, Maternity Coverage, Broker Compensation * Individual Insurance Market Reform Bill Up Next Week in Senate Health
* More Updates on the Health Access Blog: Kids Will Die; Budget Protests; Myths and Facts on the Governor's "Reform" of Medi-Cal Eligibility; Newspapers for Health Reform; Does HELP's Health Reform Go Far Enough? Key Medi-Cal Benefits Disappear; Following the Budget Debate; Major HCAN Action on June 25th in DC and Throughout California; When the Last Resort of MRMIP Isn't Available; The Case Against the Wyden-Bennett Bill; Advocacy Through Amendments; California Congressmembers Corral Caucuses for Reform; Blind to Budget Impacts?; New Drafts of Federal Health Reform, in the House and in the Senate
* Follow Health Access on Twitter, at @healthaccess, or www.twitter.com/healthaccess for quick updates on budget and health reform issues. Followers were among the the first the find out about the disability community protest and arrests in front of the Governor's office yesterday!
SACRAMENTO -- Key Assembly bills crucial to providing protections for California health care consumers were passed Wednesday by the Senate Health Committee, chaired by Senator Elaine Alquist. Votes divided mostly on party lines, even when no opposition was offered.
Next week, the committee is considering additional bills before the ultimate deadline for bills to pass out of policy committee at the end of next week. Among the bills in consideration is AB786(Jones), sponsored by Health Access California, to provide better labeling and transparency of health plans in the notoriously confusing individual insurance market.
Here's a brief report on some specific bills considered and approved to continue in the legislative process today:
* BROKER COMPENSATION: AB 1521 (Jones) advanced with nine votes in its favor. Sponsored by Health Access California, the measure prohibits health plans from providing financial incentives to agents or brokers in the individual insurance market that are not in the best interest to consumers. These would include paying agents more for signing up people deemed to be healthier than others, and paying more for consumers to enroll in new insurance plans, as opposed to continuing their existing coverage--since consumers who are persuaded to enroll in new plans run the risk of being denied coverage. The bill, by Assembly Health Committee Chairman Dave Jones (D), received no opposition because health care insurance companies maintain they do not engage in these practices, known to crop up in states other than California . Health Access California advocate Beth Capell told senators she was “pleased to support a bill that codified what turns out to be existing, good practice in the industry, and pleased to support AB 1521 before these practices became a problem."
* RESCISSION: AB 2 (De La Torre) advanced to the Senate Judiciary Committee with six votes. Assemblyman Hector De La Torre’s (D) bill was heavily opposed by the health insurance industry, including Blue Shield, Anthem Blue Cross and Health Net, some of the largest health care plans in California . It would prohibit health insurance companies from engaging in the rescission practice, in which a consumer’s health care coverage is yanked from them retroactively once major medical expenses become necessary. Anthem Blue Cross, Blue Shield and other plans received widespread news coverage of hundreds of cases uncovered in 2007 during which patients were dropped and their coverage revoked retroactive to the moment they signed up for health insurance. The measure requires a standardized questionaire for asking people's medical history, and for insurers seek approval for any rescission, rather than be "judge and jury" for consumer accused of fraud. Presently, indications are that the industry signs people up without doing research in advance, only to scour medical histories when patients most need the coverage they believed they had. An insurance company representative objected strongly to the bill, said it would “have a devastating impact on the individual market. If we know we have to meet such a high standard, there will be higher premiums and it could have the impact of restricting the number of individuals we insure.” The bill was supported by the California Medical Association and several consumer groups, including Health Access California.
* MATERNITY COVERAGE: AB 98 (De La Torre) would require all insurers to include coverage of maternity services as a basic benefit. Currently it’s possible for people to buy insurance on the individual market only to find maternity services are not covered. Health Access, which supports the bill, estimated that the investment of prenatal care and maternity coverage is paid back three times over because babies are born healthier and encounter fewer costly medical bills later in life. Insurers object to the bill because they said it would lead to fewer choices of products for consumers. Representatives of women’s groups noted that not making maternity services mandatory amounted to discrimination against women.
* COVERAGE FOR PEOPLE WITH DISABILITIES: AB 1269 (Brownley) passed with seven votes and would allow disabled Californians to continue their Medi-Cal coverage when they lose their jobs in this recessionary economy. Nearly every other segment of workers has been extended the opportunity to continue health care coverage upon unemployment, through other bills that have already moved through legislative committees or been passed and enacted into law. Under the bill, supported by Health Access California , beneficiaries would be required to pay for part of the coverage through premiums and cost-sharing and the state would be able to use federal funds for the continued health insurance coverage.
In my most recent post on The New Republic's The Treatment, I question the obsession by those in the Washington, DC health reform conversation--both legislators and media--over the "scores" provided by the Congressional Budget Office (CBO) on specific proposals.
It's important to know what a health reform will cost. I think it's equally importnat to know what that reform actually buys us, in terms of help for struggling families dealing with insurance premiums, cost-sharing, and medical debt.
In my piece, I invoke the "Moneyball" approach of the Oakland As, which looks at statistics that are more relevant to scoring runs and winning games. (The photo is of Nick Swisher, one the stars of the book, who made his way from the Sacramento RiverCats to the Oakland As and is now with the New York Yankees.) I propose that the CBO score be accompanied by other stats, including the CBI and the IOU. From the article:
It seems to me we need some new (or at least additional) metrics to properly evaluate these health reform proposals.
Every time we mention the impact of a health reform proposal on the federal budget with a CBO score, we should also give an estimate of how the proposal impacts a family budget. Call it the Consumer Budget Impact--the CBI. It would indicate how a family's premiums would go up or down--and how much their exposure to significant medical debt would decline.
True, no single number can capture this. So we may need to come up with a set of numbers and perhaps compile them into an index, the way Dow Jones uses a mix of stocks to demonstrate the performance of the market as a whole. Elected officials should know if John's family at just over the federal poverty level will be able to get coverage--and if we are expecting too much for Alice the 60-year old who is around 400 percent of the poverty level.
Remember, the subsidies in health reform don't simply help the uninsured get coverage; they also help people who already have coverage but are struggling to pay for it. Think of the early retiree who spends over $1,000 a month, and thus over a third of his or her limited income, to keep coverage. Or the underinsured young adult who can only afford the bare-bones, high-deductible health plan. Or the workers who would lose coverage if not for the assistance and new affordable options their employer is being offered.
All of these people are insured, but in a way that is inadvisable and/or unsustainable. Depending on their income, they and millions of others will get help, so they don't have to pay over a certain percentage of their income for premiums to get a standard package of benefits.
When the Senate Finance Committee comes out with its bill, I hope the political conversation concentrates less on the CBO and if they met this arbitrary $1 trillion budget target, and more on IOUs and what would be the impact on family budgets, and how many people are helped, both insured, underinsured, and overstretched.
That's what voters will care about--just like baseball fans know the win-loss record of their team, more than the cost of the team's operations. Both our elected officials and the media need to do better focusing on the score that matters.
In honor of the swearing in of Senator Al Franken of Minnesota, here's an early appearance of the candidate in March 2007, on the Late Show with David Letterman.
In the first segment, he mentions his first priority in running for office is universal healthcare. He managed to find some humor in the state of our nation's health care system. Taking the seat of the late great Senator Paul Wellstone, Senator Franken looks to be an important voice in the vibrant health reform debate.
Making sense and cents of the employer role in reform...
Last week the U.S. Senate Health, Education, Labor and Pension (HELP) Committee released a new version of its part of health reform. In the Senate, the HELP committee shares the health reform jurisdiction with the Senate Finance Committee, which has jurisdiction over Medicare and Medicaid. So some important components, like a Medicaid expansion, are absent from the HELP draft.
On the House side, the three committees have produced a joint discussion draft, called the Tri-Committees draft. It provides an interesting contrast to the two Senate versions: the employer obligation is more effective while the individual obligation is more affordable than either of the proposed Senate versions.
Employer responsibility and individual responsibility are linked: employers that provide better coverage make it easier for individuals to meet the individual mandate. If the employer requirement is low, then public programs or the exchange picks up the difference between what the employer does and what the individual can afford.
In the Senate HELP version, the employer obligation is modest while the individual obligation is substantial.
Unlike most of the reform proposals in California, but similar to Massachusetts, the HELP proposal imposes an employer “responsibility” assessment of $750 per year per full-time worker and $375 for each part-time worker unless the employer pays 60% of the premium for qualifying coverage.
The HELP proposal entirely exempts employers with fewer than 25 full-time employees (with no limit on part-timers). And it creates a small business tax credit for employers with 50 or fewer full-time employees with wages averaging $50,000 or less.
What a bonanza for restaurants and retail---especially for fast food and smaller retailers. And these are precisely the industries where employees are least likely to be offered coverage.
Why? Because the definition of full-time employee is 35 hours per week.
An employer could have literally 200 employees but so long as only 25 of them worked more than 35 hours per week, the employer would be exempt from the employer obligation—but eligible for the “small business” tax credit. Who would have a workforce that looks like this? A restaurant, a fast food place, smaller retailers.
Do WalMart and Macy’s win, too? For every employee that works less than 35 hours per week, and that is a lot of people in retail, the obligation is only $375 for the entire year. That is $31.25 per month. That is far less than the cost of private health insurance, it is even less than what California spends on Medi-Cal for working moms. Is it more than big retailers like Macy’s and WalMart do today?
The HELP version applies this requirement to every month worked: that means that the waiting periods for coverage that are common in both restaurants and retail, notoriously stretching to over a year in some instances. That will cost Wal-Mart and Macy’s something.
The CBO modeling does not appear to us to take into account the likely labor market dynamics—a fancy way of saying that lots of jobs without benefits that are full-time will become part-time if the HELP bill gets enacted.
Maybe such an approach made sense in Massachusetts where 68.3% of the under-65 population got their insurance on the job and very few purchase individual coverage. But it never made sense to us in California where only 54.7% of those under 65 get their coverage through employment—much less in LA County where only 48.8% gets coverage through the job.
In contrast, the House version includes both a more substantial employer contribution and one less likely to create labor market distortions. The House version requires large employers to contribute at least 72.5% of individual coverage or 65% of family coverage for each employee with a pro-rata share for part-timers or to contribute 8% of payroll for each employee.
The House version’s scaling of the contribution means that there is no incentive to create part-time jobs to avoid the obligation. The House version also says that it will exempt small business but does not yet define that exemption. It provides a tax credit to small businesses, with 25 or fewer employees making average wages under $20,000. The House version counts any employee who makes more than $5,000 annually, plainly including part-timers.
The House version minimizes labor market distortions in terms of part-time/full-time work. If a restaurant needs part-time employees because of the lunch rush or a retailer needs to staff up during the holiday season, that business can hire the part-time workers it needs and pay 8% of payroll into the exchange which will provide coverage for these part-time or part-year workers.
We are still waiting for CBO scoring on the House version but the 8% of payroll will create a meaningful employer responsibility contribution, especially in those industries such as retail and restaurants with substantial shares of low-wage and part-time workers.
The severity of the budget cuts is not questioned. Frankly, the severity of the response has not been proportionate, but it's starting to get closer.
In protest of the proposed budget cuts to health and human services, over a dozen Californians with disabilities were arrested this evening after they and many others blocked the hallway in front of Governor Arnold Schwarzenegger's office for over 7 hours.
It was inspiring. We at Health Access followed it on our Twitter feed at @healthaccess, which got picked up by prominent blogs like Calitics and print media like the Sacramento Bee. It also got on local television news broadcasts, like KCRA and KSBW and News 10. (The top picture is credited to David Bienick of KCRA; the second to News10.)
The protest started around noon with over 100, and lasted until 7pm, when the State Capitol building closed, and the California Highway Patrol dispersed them out of the building, with an arrest-and-release citations for 15 of the three dozen that were left.
The CHP has threatened earlier in the day to take the protestors to county jail, but some of the protestors responded that they rather would go to jail than a nursing home--their only alternative if they lost IHSS home care services. The police probably thought twice about that--some of the protestors would have required significant attention in jail--after all, they were folks who need home care to be self-sufficient. So taking any of these folks into custody would have meant taking care of them in a significant way.
The CHP actually were accomodating to the protestors, steering hallway traffic away from the hallway blocked by wheelchairs--where the protestors yelled "hold the line" if an unwitting Capitol staffer attempted to cross. The protestors were prepared, with food and blankets, to stay much longer.
The citations were different for the various protestors, for a mix of charges: demonstrating without a permit, disrupting state business, refusing to leave a closed state building.
We were happy to see disability community leaders like Frances Gracechild, head of Resources for Independent Living in Sacramento, and a former chair of Health Access California board. But there were also other leaders from around the state, and just grassroots folks outraged by the current budget situation and stalemate.
Several legislators came down to talk to them and cheer them on. Sen. Romero, Steinberg, Cedillo, and Assemblymembers Beall, Skinner, and Perez all were reported to have spoken with the crowd. (Perez actually ordered the protestors pizza for dinner.) The crowd had asked to see Governor Schwarzenegger for over a month, and refused meetings with underlings.
The Governor went about his day, including having lunch at the fancy restaurant Mason's.
The day was inspiring for the rest of us, that we have more work to do to spotlight the real human, financial, health, and other impacts of these cuts, and to make clear that our policymakers have choices, and right now, they are making wrong ones.
From the generally very polite 100% Campaign, which includes leading children's, religious, and community organizations:
Whether the budget proposal to eliminate (Governor’s) or cut (Conference Committee) Healthy Families is approved, the result will be the same: kids will get sick and some will die as parents are forced to delay health care until it’s too late because they can't pay for it. Any proposal that leaves children without access to health coverage is misguided and will not solve the budget crisis as these children will be forced into more costly types of care. All such proposals should be rejected.
Myths and facts on Medi-Cal eligibility processing
Health advocates are all for streamlining our bureaucracy, especially the enrollment and retention procedures that allow people to get the health and human services they need. Health Access California has sponsored and supported legislation on the subject. Some of these efforts have succeeded, others have been defeated--largely because they would actually allow more people to get on to the programs they are eligible for, costing more money.
What the Governor is proposing in this latest round of talks is different--these aren't efforts to streamline the programs, but that could very well make it harder to get on these programs in the first place. There are some useful reforms--and some of them are already underway.
From the County Welfare Directors Association and the California State Association of Counties, here's some facts to rebut the Governor's case for stalling the budget to deal with "reforms" in processing those seeking Medi-Cal coverage and other services.
Myth: The current eligibility process for Medi-Cal is “pen-and-paper” and handled by 27,000 workers “scattered” throughout the state’s 58 counties. (Op Ed, 7/3/09)
· After 20 years of repeated and failed attempts by the State to bring automation to the Medi-Cal, CalWORKs and Food Stamps programs, California counties successfully developed and implemented automation in all 58 counties.
· Counties and the state are already working to use technology to streamline application for programs. For example, individuals can already apply for Food Stamps online in five counties, expanding to all counties over the next year. Concurrently, on-line integrated access to Medi-Cal, CalWORKs, and the County Medical Services Program (CMSP) will be added for 39 counties. Counties will continue to add on-line services as funding permits.
· Counties and the Administration are working on a project to allow on-line application for a whole variety of health and human services programs. The Governor curiously fails to acknowledge this fact in his OpEd.
· The staffing number used by the Governor includes not just eligibility, but also employment services workers who help people move from welfare to work.
Myth: Centralizing and modernizing eligibility would save $500 million a year. (Op Ed, 7/3/09)
· The savings figures are overstated, as they have been every time this proposal or a variant of it has been put forth, and an accounting of the upfront costs and likely actual savings of this proposal has never been provided.
Ø Eligibility costs are driven by complex program rules, not the counties.
Ø The Administration’s math assumes that Medi-Cal, Food Stamps, and CalWORKs can be compared to the Healthy Families program, which is a nonsensical, apples-to-oranges comparison.
Ø The Governor’s proposal would substantially add the budget deficit, as it would duplicate existing automation and would likely not be eligible for federal funding.
· Based on the experiences of other states, these savings will not materialize.
Ø Projects in Texas, Indiana, Wisconsin, Ohio, and the District of Columbia, to name a few, provide recent examples of cost overruns and overcharges across multiple human services programs.
Ø In Texas alone, the state was promised $600 million in savings that never materialized. The Texas Comptroller advised the Legislature that “this project has failed the state and the citizens it was designed to serve” and called the plan a “perfect story of wasted tax dollars, reduced access to services and profiteering at taxpayers' expense.”
· California spends less than other states to administer these programs. The most recent federal claims data shows that California’s Medicaid administrative cost per recipient is well below Pennsylvania and Tennessee, and is right in line with Illinois and New York.
Myth: The programs being considered for centralized, privatized eligibility are fraught with errors.
The State is not penalized for Medi-Cal errors, and the current error rate is low. Food Stamp error rates have been low for a number of years following collaborative efforts between the state and counties to reduce errors. The state actually received bonuses from the USDA in recent years based on its improved Food Stamp performance. There is no national error rate for CalWORKs, but a recent review of a sample of states found California to make fewer errors than the other large states that were studied.
Myth: Centralizing and privatized eligibility is good for clients and will improve customer service.
· There is no evidence that centralized, privatized eligibility improves customer service, which is why every major client advocacy organization has come out in opposition to the proposal. In fact, the results in other states show worse customer service. In just the first four months of the Texas project, more than 100,000 children lost their health coverage. In Indiana, the most recent example of failed privatization, major media outlets and many legislators have called for a halt to the process and the state has responded by voluntarily stopping implementation in a majority of counties.
· Failed privatization continues to harm clients. After Texas terminated its contract with the Texas Access Alliance, it had difficulty staffing back up to meet demand, with people seeking benefits bearing the brunt of the problem. Offices were understaffed and calls went unanswered, leading the Fort Worth Star-Telegram to conclude “the ringing phones are fallout from a major experiment in state government that nearly everyone involved calls a disaster.”
They had a follow-up editorial today correctly citing the need to pay for reform. National health reform is going to need up-front investments. But we disagree with the second part of the statement that "Insuring more people might be good policy, but it will not save money." Bringing everybody into the health system not only allows for cost-saving preventative care, but gives policymakers the tools to drive payment and system changes to encourage the best quality and low-cost care. It is a result of our fragmented non-system that our level of spending does not have any correlation to the quality of care. And health reform includes key components, from the public health insurance option to comparative effectiveness research, that can have an impact to.
The Los Angeles Times had a long editorial as well on health reform, with several key points we agree with mostly, but not entirely. Here are snippets of interest:
Access to affordable healthcare in the United States is an entitlement, a perquisite or a fantasy, depending on a seemingly arbitrary matrix of factors. Government insurance programs are available for the elderly, the permanently disabled, people with failing kidneys, the impoverished and children from low-income families. But how poor one has to be to qualify varies from state to state and from year to year. Employees at most large companies and many small ones can take advantage of group insurance plans negotiated by their employers. But millions of people who work in low-paying service, retail or contracting jobs have to seek individual insurance policies, which may be unaffordable or unavailable because of their medical histories. Others obtain insurance with deductibles so high or coverage limits so low that one bad accident or illness could bankrupt them.
It's an irrational system with inhumane and costly results that extend beyond the 47 million uninsured. According to the Kaiser Family Foundation, more than half of the adults without insurance have "no regular source of healthcare" other than an emergency room. They are more than four times as likely as the insured to delay a trip to the doctor, and six to eight times as likely not to get treatment because of the cost. The consequences for the uninsured include more serious ailments and a higher premature death rate; for everyone else, the consequences include the loss of productivity attributable to worker illness, a higher risk of infectious disease and about $50 billion in medical bills passed along by those who couldn't pay them.
Most important, the large and growing number of uninsured Americans make it well-nigh impossible to overhaul the healthcare system to improve quality and control cost. Bringing those people in from the fringes is crucial to changing the system's incentives, shifting from a model that relies on sickness to one that promotes prevention and wellness, increases the supply of primary care and improves coordination among its many elements...
Washington can't order people to buy insurance without helping millions of them pay for policies they couldn't otherwise afford. Kaiser estimates that almost 40% of the uninsured in 2007 had family incomes at or below the federal poverty level, and another 29% had incomes less than twice the poverty level. Typical group policies cost $12,200 on average for a family of four in 2007 -- more than a full-time minimum-wage worker earned that year. Even at twice the poverty level, the average premium for a group policy would devour 20% or more of the family's income. Any individual mandate would have to be accompanied by subsidies for those who make too much to qualify for Medicaid but too little to afford a standard insurance plan...
It's legitimate to ask why some employers -- or more accurately, their workers -- shoulder the cost of the healthcare system when others do not. That's why a limited mandate, scaled to the size of the business and its payroll, may be in order. If a company can't afford the extra cost, it could opt out by paying a tax based on the size of its payroll.
Bringing the uninsured and underinsured completely into the system will set the table for reforms that improve care and save money for everyone. The Commonwealth Fund recently estimated that the cumulative savings from these reforms could be $1.2 trillion to $3 trillion by 2020. But those savings don't represent actual reductions in the cost of healthcare; they represent how much less those costs are expected to increase. Similarly, providing insurance for millions of low-income Americans should drive down inefficiency and cost-shifting within the system; instead of getting much of their treatment in expensive emergency rooms and passing the costs on to people with private insurance, they can get more routine and preventive care paid for by their own policies. But taxpayers will have to bear much of the cost of providing that coverage, which the Congressional Budget Office has estimated to be at least $1 trillion over the next decade.
In short, shifting to universal coverage will generate a mix of costs and benefits, with some segments of the economy taking on more of the burden and others less. The biggest potential winners would be healthcare providers, whose services would be in greater demand from the newly insured, and private insurers, who stand to pick up millions of new, federally subsidized customers.
In fact, the expansion could yield a windfall for insurers or healthcare providers that dominate a market. That's why it's important to promote competition while imposing insurance mandates, starting by creating one-stop shopping exchanges where people can compare and purchase policies that meet a minimum standard for coverage.
Although it's a lightning rod for critics, the idea of the government establishing public insurance plans to vie with private ones for subsidized policies is worth exploring. It's a potential counterweight to the power wielded by a single healthcare provider or insurer in too many communities, a recent Urban Institute study contends.
A good model is L.A. Care Health Plan, one of the county-based plans that California created in the early 1990s to manage the care of Medi-Cal patients. Unlike Medicare or Medicaid, which can dictate prices, it has to negotiate rates with doctors and hospitals just as its private competition does. And it's steered by a board of healthcare providers, patients and county officials with a directive to preserve the safety net, which has encouraged it to pursue the best care at the least cost. The new public plans could take on a similar civic mission: to help develop prevention- and wellness-focused approaches to care.
We can't kid ourselves: Expanding insurance coverage is expensive. It also raises thorny questions about how far to go, including whether to cover illegal immigrants and how to enforce the individual mandate. But the payoff is a real one, with the benefits mounting over the long term in the form of a rational healthcare system that delivers increasing value for the money. It's a price worth paying.
These editorial boards have opposed some previous efforts at health reform in the past, so the fact that there's an endorsement of employer responsibility and a public health insurance option--albeit weaker versions of what we recommend and advocate--it shows a critical consensus is forming.
In comparison, an average employer-based plan for an average worker costs over $4,000 per year, and over $12,000 for a family. In 2003-4, the California legislature, and nearly half its voters, supported a requirement on larger employers to pay 80 percent of premium. You don’t have to support that threshold to think that $750 is low, either to secure or to expand on-the-job benefits.
Health policy experts, like Paul Fronstin at the Employee Benefit Research Institute, and others that I have consulted, seem surprised at the low bar of the HELP Committee bill. The employer assessment is crucial--of similar import to the establishment of the minimum wage a century ago--but the amount is like setting the minimum wage at $2/hour. The proposal to pay 60 percent of premium for a worker, or pay $750--which is around 36 cents an hour, or only 4 percent of payroll a worker making $19,000 a year, and much less for those with higher wages.
Governor Schwarzenegger, a Republican with a near-perfect Chamber of Commerce record, eventually agreed to a sliding scale up to 6.5 percent of payroll. And he brought some of the business community with him in support. An employer requirement at an appropriate level certainly wasn’t his first choice for financing his health reform, but he saw that health reform doesn’t work without it...
As the Senate looks to put together the financing for their bill and paying for the crucially important subsidies that will be needed to ensure affordability and coverage for all Americans, it should look toward the House proposal, which has a minimum employer requirement of 8 percent of payroll.
Speaker Karen Bass gives an update on the budget crisis. It's discouraging that the Governor seems to be using the budget crisis to demand unrelated policy changes from the Legislature, even allowing the budget situation to get worse.
Some of the Governor's so-called "reforms" include changing the entire way we enroll people in Medi-Cal and other human services. But it seems its more about eliminating the people who help people navigate the complicated process of getting enrolled, than actually removing those complicated procedures in the first place.
Hopefully there will be more progress in the coming days.
The federal health reform debate continues full steam ahead.
The Kaiser Family Foundation has a useful chart of the three leadership measures, the one "discussion draft" proposal in the House of Representatives, and the two others--which are in various forms of public release--in the Senate.
There are other proposals, both big and small floating around Capitol Hill(from single-payer and the Wyden-Bennett bills, to specific legislation on specific issues), but they will largely serve as ideas that will influence the three leadership bills are the main vehicles being authored by the key committees that have jurisdiction.
Due to the pace of Congressional discussions, the attached chart does not capture some of the more recent revisions we’ve heard about. For instance, just yesterday, the Senate HELP Committee released more details of their bill, including a public plan option and an employer mandate for employers with more than 25 employees, which has been scored at $611.4 billion (not including Medicaid) and is stated to cover over 97 percent of Americans. And Senate Finance Committee members continue to work on the cost of their bill, in part by tinkering with the level of subsidies.
We'll have more analysis--much more--in the next few days.
The picture above is of Representative Xavier Becerra, a key member of the leadership of the House of Representatives, who appeared at a packed Health Care for America Now town hall this Monday. He is pictured with leaders from California Partnership, Children's Defense Fund - California, and Health Access California.
We at Health Access California wish the best to Representative Henry Waxman, who is recovering from a fainting spell earlier in the week. He was at Cedars-Sinai hospital, and even had to cancel an appearance on The Daily Show with Jon Stewart last night.
Californians need him healthy, since we are in the stretch run for comprehensive health reform, and he's a central player as the Chairman of the Energy and Commerce Committee, which has responsibility over health reform--as well as environmental legislation like the climate change Waxman-Markey bill passed last week.
The Chairman has a new interesting new book out, entitled The Waxman Report, which was favorably reviewed in the Los Angeles Times, and details his many legislative accomplishments. We are going to need his experience and savvy--as well as the trust he has built up over the year--in order to get this done.
As July 1st hits, a budget fix for California is apparently nowhere in sight. So how is this year different from years past?
Besides the alarming $24 billion hole in California's budget, we seem to have a different Governor. As recently as 2007-08, Gov. Schwarzenegger was actively advocating for health reform. Now he proposes to endanger the intergrity of the very programs on which health reform would be built.
The "Year of Reform" governor sought to expand and improve Medi-Cal. Today, our public health programs seem to be a prime place he goes to find "savings" in the state budget. While, on one hand, he's demanding big-picture solutions from legislative leaders, with the other hand he's passing around a new package of proposals that could, in effect, make Medi-Cal coverage less accessible.
Under the guise of modernizing the system and "bringing California into the 21st Century," Schwarzenegger would eliminate 27,000 county workers who currently help Medi-Cal recipients with complex enrollment procedures. He calls person-to-person interaction an "antiquated process...relying on slow and time-consuming face-to-face and mail-in processes that are only available between 9-5 and lack uniformity across counties."
Moving the process online, he says, will be "taking advantage of the latest technologies to allow people to apply and enroll in state programs faster and with fewer hassles -- all while reducing costs." It almost sounds too good to be true.
Advocacy groups like the Western Center on Law & Poverty find this alarming.
People need the help of those county workers -- their face-to-face interaction, and step-by-step assistance -- to successfully enroll in Medi-Cal or determine their eligibility. Medi-Cal is an exceedingly complex program.
Advocacy groups also know that a process to apply for Medi-Cal online is already underway, and believe this should be but one of several options for people to sign up for Medi-Cal. The online project is being carefully monitored by stakeholders who want to make sure it's fair, accessible and works well as it proceeds.
Yet the Governor's proposal is something else--a wholesale privatization, turning enrollment into a for-profit private vendor like Maximus. Such privatization makes government programs less transparent and accountable -- and can lead to time lags in enrolling patients (thus saving the state money). Other states have tried privatizing the management of health care eligibility and enrollment with little success.
Even Texas cut the cord on its privatization effort, finding itself without the promised savings and short on workers who previously administered the program. The Fort-Worth Star Telegram reported that, in the end, offices were understaffed, calls went unanswered and Texas was left with "fallout from a major experiment in state government that nearly everyone called a disaster."
To be clear, Schwarzenegger's proposal isn't intended to simplify and eliminate the various enrollment barriers, like the asset test or regular redeterminations. It's meant to undo the network of people that help low-income families navigate this complex and confusing system.
This could result in fewer people enrolling in Medi-Cal, especially since the least likely population to have online access at home include low-income seniors and people with disabilities. Those are the people who Medi-Cal is responsible for serving -- and California already spends less on their care than other states.
So what may seem logical -- taking advantage of online capabilities -- may turn into a barrier, a barrier that results in fewer people receiving Medi-Cal health insurance. But that may be the point.