California Budget Woes Jeopardize Medi-Cal Coverage for 80,500 Children

California Governor Gavin Newsom's revised budget proposal fails to fund a multi-year continuous enrollment policy, putting 80,500 children's Medi-Cal coverage at risk. The policy's lack of funding disproportionately affects children of color, who make up three-fourths of Medi-Cal recipients.

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Aqsa Younas Rana
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California Budget Woes Jeopardize Medi-Cal Coverage for 80,500 Children

California Budget Woes Jeopardize Medi-Cal Coverage for 80,500 Children

California Governor Gavin Newsom's revised budget proposal has failed to fund a multi-year continuous enrollment policy, putting the Medi-Cal coverage of approximately 80,500 children aged 0-6 at risk since June 2023. The development is part of the state's ongoing budget crisis, with a projected shortfall of about $56 billion over the next two fiscal years.

Why this matters: The loss of Medi-Cal coverage for thousands of children can have long-term consequences on their health and well-being, potentially leading to increased healthcare costs and a heavier burden on the state's healthcare system in the future. Furthermore, this development highlights the need for sustainable budget solutions that prioritize the health and welfare of vulnerable populations, such as children andcommunities of color.

The multi-year continuous enrollment policy, which was adopted in the 2022-2023 budget, allows children under age 5 to maintain their Medi-Cal coverage without annual redeterminations. These redeterminations can lead to loss of coverage due to administrative hurdles, even when families remain eligible. Advocates argue that gaps in coverage result in missed essential health care, including vaccinations and early identification of developmental delays and interventions.

The lack of funding for the policy disproportionately impacts children of color, as three-fourths of children covered by Medi-Cal are from these communities. Medi-Cal serves as the primary source of coverage for Latine and Black children in California. A coalition of organizations, including Children Now, First 5 Association of California, and March of Dimes, expressed frustration with the budget revision, emphasizing the importance of preserving children's Medi-Cal coverage. "Providing continuous Medi-Cal coverage is an important first step in achieving health equity for young children in California," the coalition stated.

To address the state's budget woes, Governor Newsom plans to balance the budget through $30 billion in ongoing and one-time spending cuts, as well as using $12.2 billion in rainy day funds and $900 million from a safety net reserve. The revised budget also proposes using nearly $7 billion from the managed care organization (MCO) tax to help balance the budget instead of funding healthcare investments, as originally planned.

The budget revision is part of a larger process, with legislators set to pass their own version of the budget by June 15. The governor can then sign the budget or veto some or all of it. The coalition is urging the legislature to prioritize funding for the multi-year continuous enrollment policy in the final 2024-2025 budget to prevent more children from losing their Medi-Cal coverage and ensure California does not fall behind other states implementing similar policies.

Key Takeaways

  • CA Governor Gavin Newsom's revised budget proposal fails to fund continuous Medi-Cal coverage for 80,500 children aged 0-6.
  • The lack of funding puts children's health and well-being at risk, potentially increasing healthcare costs in the future.
  • The policy disproportionately affects children of color, who make up 3/4 of Medi-Cal recipients.
  • The budget revision proposes $30B in spending cuts and uses rainy day funds to balance the budget.
  • Advocates urge the legislature to prioritize funding for continuous Medi-Cal coverage in the final 2024-2025 budget.