On May 14th, Governor Brown announced that the budget shortfall for the current and next fiscal years has grown to an estimated $15.7 billion, mainly due to lower-than-anticipated tax collections. In order to close the $15.7 billion gap, the governor also released his revised budget proposal for fiscal year 2012-2013, which includes an increase in taxes for the wealthiest Californians and a temporary one-quarter cent increase in state sales tax to increase revenues by $8.5 billion. Both increases will require voter approval in November. In addition, the revised budget maintains several proposed cuts to In-Home Supportive Services (IHSS) and other programs, and includes additional cuts that had not previously been proposed. Below is a summary of some of the governor's key proposals related to IHSS and Medi-Cal. For additional information, please visit our website at www.pascla.org.
Across the Board Reduction of IHSS Service Hours by 7%
New Proposal in May Revise
The governor has proposed to reduce IHSS hours for all consumers by 7% effective August 1st. Consumers would be able to decide themselves how to apply the 7% reduction to their services.
This reduction would be similar to a temporary 3.6% reduction to IHSS hours that was implemented in 2010. That reduction is set to expire on June 30th, and the governor has not proposed to extend it. However, if passed, the 7% reduction in hours would be on top of the 20% reduction and the elimination of domestic and related services for some consumers as explained below.
Elimination of Domestic and Related Services
Proposed in January
The governor has proposed to eliminate IHSS hours for domestic and related services for consumers residing in shared living arrangements, effective July 1st. This includes hours for tasks such as meal preparation and clean-up, laundry, housecleaning, grocery shopping and errands. This cut would apply to any consumer who does not live alone, regardless of their relationship to the other residents.
Continuation of 20% Service Reduction
Implementation Delayed by Pending Litigation
During his December 13th press conference, the governor announced that it would be necessary to enact a mid-year trigger cut to IHSS that was approved as part of the state budget passed last summer. The trigger would cut funding for IHSS by $100 million, by reducing service hours for almost all IHSS consumers by 20%. The reduction was scheduled to go into effect on January 1st. However, U.S. District Court Judge Claudia Wilken issued a preliminary injunction requiring the California Department of Social Services to stop all actions that were being taken to implement the 20% reduction, pending the result of a lawsuit that seeks to permanently stop the reduction (David Oster et al. v. Will Lightbourne and Toby Douglas).
The governor's budget proposal assumes that the state will be successful in the pending litigation.
IHSS and Managed Care
Proposed in January, Modified in May Revise
Legislation passed in 2010 and the award of a federal grant from the Centers for Medicare & Medicaid Services (CMS) authorized the state to implement pilot programs in four counties that will enroll individuals who receive both Medi-Cal and Medicare (commonly known as "dual eligibles") in managed care plans.
The governor has proposed to expand the four-county pilot to enroll 1.2 million dual eligible individuals into managed care plans throughout the state. His budget also proposes converting IHSS into a managed care benefit over a three-year period. The governor's May revision delays the initial implementation of the program from January 1, 2013 to March 1, 2013. It also reduces the number of counties that he had proposed to participate during the first year from ten to eight. For more information on the managed care proposal, click here.
Medi-Cal Enrollment Period
Proposed in January
Current law states that Medi-Cal recipients may change the managed care plan they are enrolled in once per month, or 12 times per year. The governor has proposed to establish an annual open enrollment period for Medi-Cal recipients who wish to change plans. If enacted, recipients would be able to change plans only during the open enrollment period, and would have to keep the plan that they change to for at least one year.
Medi-Cal Co-Pays
Proposed in May
In 2011, several co-pays related to Medi-Cal expenses were passed into law, but were never implemented, because they did not get the necessary federal approvals. The governor has proposed to instead implement fewer, more modest co-pays for certain Medi-Cal services, including a $15 co-pay for non-emergency room visits and $1 and $3 copays for certain prescription drugs.
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