State Budget Expands Access to Health Care

Gov. Jerry Brown signed a state-spending plan for the coming fiscal year, which expands Medi-Cal to an additional 1.4 million low-income Californians. In doing so, the state is adopting an optional provision of the federal Affordable Care Act.

The budget leverages private funds from The California Endowment and federal matching grants providing $53 million for Obamacare outreach and enrollment assistance at no additional cost to California taxpayers. This funding will provide $28 million in private and federal money to support enrollment for up to 450,000 Medi-Cal applicants. It will provide $25 million for Medi-Cal outreach and enrollment grants targeting mixed-status families, the homeless, school-age children, and other vulnerable populations.

In the short term, fiscal savings would far outweigh the non-federal costs of providing health care to the expansion population, according to a statement by the California Legislative Analyst’s office (LAO). LAO said, “After a decade, when the enhanced federal matching rate is reduced from 100% to 90%, we estimate that overall savings to the state as a whole (state and local governments) would likely continue to outweigh costs…We believe the policy merits of the expansion and the fiscal benefits that are likely to accrue to the state as a whole outweigh the costs and potential fiscal risks. We recommend the state adopt the optional expansion.  We also find that the state is in a better position than the counties to effectively organize and coordinate the delivery of health services to the newly eligible population — potentially resulting in improved health outcomes and administrative efficiencies. As a practical matter, we also believe the state is better positioned than the counties to successfully implement an expansion by January 1, 2014. We recommend the Legislature adopt a state-based expansion, shifting the fiscal and programmatic responsibility of providing health care to the expansion population from counties to the state.”

Last Updated 12/02/2020

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