In summary
California's health care industry is largely united in support of Proposition 35, which would strengthen Medi-Cal by directing money from taxes on health insurance plans.
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Thanks to a ballot measure approved by voters Tuesday, doctors who serve California's poorest residents will see their pay increase, in some cases for the first time in 20 years.
The Associated Press announced that Prop. 35 had won, with results showing Prop. 35 with a significant lead. The ballot measure asks voters to allocate between $2 billion and $5 billion a year in special tax revenue to Medi-Cal, the state's health insurance program for low-income residents and people with disabilities. The revenue comes from an existing tax on health insurance companies, and lawmakers can now spend it in other ways.
Supporters of the bill, which includes nearly the entire health care industry, have long argued that tax revenue comes from health care and should be reinvested in the state's health care system.
“A victory on the ballot for Proposition 35 is a victory for patients across California,” said Jodi Hicks, president of Planned Parenthood Affiliates of California and co-chair of Proposition 35, in a statement.
Dustin Corcoran, another co-president and CEO of the California Medical Association, said voters made a “generational investment” that stabilized the Medi-Cal program.
Nearly 15 million Californians, one-third of the state's population, rely on Medi-Cal. Over the past decade, the state has taken steps to expand access and benefits to our poorest and most vulnerable people.
However, this expansion has not been accompanied by incentives for doctors to see more patients, and the Medi-Cal system is plagued by long wait times and poor outcomes.
Opponents of the bill, primarily small community health care providers and disability advocates, warned that Proposition 35 would be too restrictive on Medi-Cal spending. They acknowledged the results and said the voting results showed Californians want to ensure funding for Medi-Cal.
“Today's vote makes clear that Californians support the Medi-Cal program and want to improve access to health care for our most vulnerable populations. “While we opposed Prop. 35, state leaders now have a mandate to improve Medi-Cal, and they must do so,” said the executive director of the California Pan-Ethnic Health Coalition, which led the opposition. Director Kiran Savage Sangwan said. campaign.
What does Proposition 35 promise?
Payments to doctors and others who serve Medi-Cal patients have not kept pace with state benefit and eligibility expansions. According to the Kaiser Family Foundation, California's reimbursement rates rank among the third-lowest state Medicaid systems.
Proposition 35 would allocate a large portion of the state's managed care organization tax (MCO tax) to rate increases for certain health care providers to improve access to care.
Taxing health insurance is based on a long-standing agreement with the federal government. Health insurance companies agree to put tax dollars into the Medi-Cal system in order to receive a dollar-for-dollar match from the federal government. California has levied taxes on health insurance companies off and on for the past 20 years, but has not specified how the money will be used.
Some of the winners who could see higher pay if Prop. 35 passes include physicians and certain specialists, behavioral health facilities, outpatient clinics, hospitals, ambulance crews, and residents.
What will happen to the national budget?
Medi-Cal receives about $35 billion from California's general fund, and the state currently devotes about $7 billion to the program from MCO taxes. Gov. Gavin Newsom and lawmakers agreed in this year's budget to use a portion of the tax money to pay for some rate hikes and expansions, but those weren't necessarily the rate increases that the measure's supporters had hoped for.
Since voters approved Proposition 35, the state will face a $2.6 billion deficit in its current budget because the ballot measure will redirect funds earmarked for other things. That deficit will grow to $11.9 billion over the next three budget cycles, according to a Treasury analysis.
Lawmakers do not have to address the shortfall until next June's budget deadline. However, most of the MCO tax will not be available for general government spending.
Among the rate increases that would be canceled if the proposal passes are air ambulances, pediatric and adult day services, congregate living medical facilities, private on-call nursing, and continued medical insurance for children under 5. Included.
Who supported it?
A broad healthcare coalition, including doctors, hospitals, dentists, community clinics, emergency responders, and family planning, supported Proposition 35.
Supporters have raised more than $55 million, with the largest donations coming from the California Hospital Association, California Medical Association and ambulance company Global Medical Response.
They argued that without serious investment, Medi-Cal patients will continue to receive care in a second-tier system that doesn't have enough doctors to meet their needs. Advocates also said they are tired of politicians promising to fully fund Medi-Cal but not doing so. Last year, Gov. Gavin Newsom struck a deal with proponents of Proposition 35 to inject more MCO tax revenue into Medi-Cal, but this year he redirected most of that money to fill the state's budget gap.
Who objected and why?
Proposition 35 was opposed by a small group of community health advocates and medical providers, including the California Pan-Ethnic Health Network, the Children's Partnership, and the California Law and Western Center on Poverty and Disability Rights.
They acknowledged that providers would need to pay more for services, but argued that the proposal could backfire and cause Medi-Cal to lose billions in federal funding. This is because the state of California was disciplined by the federal government for exploiting a loophole in its tax law. If the proposal passes, opponents said, it would be extremely difficult for states to change how they fund Medi-Cal.
After the bill passed, opponents said the state needed to be transparent about how it uses special tax revenue and consult with communities that rely on Medi-Cal.
“Longer term, state leaders will face challenges created by Proposition 35's federal revenue limitations.Fully funding Medi-Cal will require increased revenue and We need to ensure that Californians and businesses pay their fair share to support health and well-being,” Savage Sangwan of the California Pan-Ethnic Health Coalition said in a statement.
Mr. Newsom did not formally oppose the bill, but he expressed concern about its potential to limit how lawmakers can spend money in the face of a multibillion-dollar state budget deficit.
Supported by the California Healthcare Foundation (CHCF). The foundation works to ensure people have access to the care they need, when they need it, at an affordable price. For more information, please visit www.chcf.org.
