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On January 10th, Governor Jerry Brown released an 18-month proposed budget plan aimed at closing a $25.4 billion shortfall for fiscal years 2010-11 and 2011-12. The plan calls for a 5-year extension of tax increases previously approved under the Schwarzenegger Administration as well as $12.5 billion in painful cuts, including $1.7 billion from Medi-Cal and $1.5 billion from the CalWORKs program.

The budget plan leaves K-12 education primarily intact but includes further cuts to higher education and a significant realignment proposal that would transfer responsibility for running certain state services to local counties, including mental health, foster care, child welfare, substance abuse, and adult protective services, as well as some corrections and fire services. You can access the budget directly on the Department of Finance’s website.

Highlights of the 2011-12 General Fund Spending Plan Include:

Medi-Cal:
Governor Brown’s budget proposal includes $1.7 billion in cuts to the Medi-Cal program which serves 7.7 million low-income Californians. Reductions would be made through limits on services, mandated co-payments, decrease in provider rates, and other reductions. The proposal calls specifically for:

  • Annual caps on medical services including hearing aids, durable medical equipment, incontinence supplies, urological supplies, and wound care.
  • Limits on prescriptions (except life-saving drugs) to six per month.
  • Limits on doctor visits to 10 per year.
  • A new mandated share of cost for services including a $5 co-pay on physician, clinic, dental, and pharmacy services, a $50 co-pay on emergency room services, and a $100 a day and $200 maximum for hospital stays. Co-pays on dental payments would take effect May 1, 2011, all others October 1, 2011.
  • Elimination of Adult Day Health Care benefiting over 27,000 recipients.
  • Elimination of other Medi-Cal benefits such as over-the-counter cough and cold medications and nutritional supplements.
  • A 10% reduction in Medi-Cal provider payments.
  • Diversion of Prop 10 reserves to fund health services for young children.
  • An extension of the existing hospital fee.

Healthy Families:
Additionally, the Governor’s proposal includes $38.5 million in spending cuts to the Healthy Families program which serves nearly one million low-income children in California . Specifically the plan:

  • Eliminates vision benefits for children in Healthy Families.
  • Increases premiums for Healthy Families recipients with incomes above 150% FPL ($33,075/year for a family of four) from $16 to $30 a month, with the family maximum increasing by $42 to $90 a month. Recipients with incomes between 200-250% FPL ($44,100 to $55,125 for a family of four) would also see their premiums increase from $24 to $42 a month, with the family maximum increasing by $54 to $126 a month for a family with three or more children.
  • Increases co-pays for emergency room visits from $15 to $50 and inpatient stays from $0 to $100 day with a $200 maximum.

Other cuts that will impact our communities:
The budget also makes deep cuts to the In-Home Supportive Services program ($500 million) by reducing service hours and eliminating domestic and related services for certain recipients, and reducing grant levels for seniors and disabled in the SSI/SSP program to the federal minimum.

What Happens Next?
The Legislature is debating the budget proposals under a shortened 60-day timeline so that the Governor’s revenue package can be placed on the June 2011 ballot. Failure to extend the temporary tax increases through the initiative process will result in additional devastating cuts to California ’s safety-net programs.

Take Action!
Our representatives need to hear from you! Send in a letter to the Chairs of the Senate and Assembly Budget Committees TODAY letting them know you oppose cuts to critical programs and urging them to consider all revenue options available. Here's a sample letter you can use


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