By Wendy Lazarus
To be sure, the looming $25 billion-plus budget hole is a serious challenge that requires wrenching choices. But it is precisely in these tough fiscal times that it’s most vital for the state budget to reflect the priorities and wise budget choices Californians want our leaders to make.
Although nearly 70 percent of California voters think children not having health insurance is a serious problem, the Governor’s budget proposes to save $78 million in General Fund dollars by cutting back eligibility for kids who need California’s Healthy Families Program. This move would result in over 200,000 children losing their health coverage in one fell swoop in May. The governor also proposes a trigger that would save $126 million in General Fund spending by eliminating California’s Healthy Families program entirely—causing nearly one million children to join the ranks of the uninsured—if our state leaders can’t bring home $6.9 billion dollars in federal funds, a worthy goal but a feat virtually no one thinks is possible.
Dropping nearly a million children from health insurance, as the governor’s proposal contemplates, would result in taxpayers paying more in the long run. Uninsured children still need health care. They are just sicker and it becomes costlier to treat them when they finally get care.
There are multiple reasons why California doesn’t get its proportionate share of federal dollars, including funding formulas that need to be addressed. But much of the blame is our own: our leaders have chosen not to invest as aggressively as they could in drawing down available federal matches because of a preoccupation with saving state general fund dollars even when it sacrifices federal dollars equal to or greater than any state savings.
California has used this faulty fiscal logic decade after decade in both Democratic and Republican Administrations, while other states like New York and Illinois have maximized their federal “take home” by investing state dollars to bring down far more federal funds. But California’s policies have cost us much more than lost federal dollars in our budget—we’ve also undermined highly-effective programs like Healthy Families, and we’ve given up the jobs and economic stimulus that programs such as Medi-Cal have been proven to deliver to local communities.
Rather than voluntarily forfeit federal funds, California should build on last year’s success, when health plans, First 5 California, hospitals, and families using the Healthy Families Program all stepped up and found ingenious ways to lower costs and cobble together the General Fund match required to keep the program whole at this critical time. Succeeding again this year would protect our kids. It would also leverage state funds and federal funds for children to the maximum extent possible.
Wendy Lazarus is Founder & Co-President of The Children’s Partnership, a national child advocacy organization, with offices in Southern and Northern California and Washington, DC, working to ensure that all children—especially those at risk of being left behind—have the resources and the opportunities they need to grow up healthy and lead productive lives.