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Updated February 26, 2010
On January 8, Governor Schwarzenegger proposed a budget which again targets low-income Californians by reducing or eliminating crucial health and human services programs. Some proposals duplicate those of previous years, most of which were rejected by the legislature. Some of the proposals approved by the legislature last year have been stopped by federal courts, yet the Governor is bringing them forward again.
The administration has attached savings to each proposal, but acknowledges that it has not factored in the costs, both human and financial, of the massive cuts. For example, the proposed dismantling of two key programs for Californians with disabilities, including seniors – In Home Supportive Services (IHSS) and Adult Day Health Care – will inevitably lead to:
As before, poor Californians would be hit by the budget hammer again and again, if they depend on multiple programs for their health, safety and income.
This preliminary analysis is based on the documents released on January 8, 2010, and focuses on programs and services which are particularly significant for adults and children with disabilities, arranged by each relevant state department. This analysis is not comprehensive, as it does not cover all the proposed cuts, such as in CalWorks, food and health programs, and general education, which affect people with disabilities along with other Californians. In addition, the administration has not yet released details for some of the cuts. In many cases, the Governor proposes both cuts for the current budget year and the next one.
We are linking our summary of the budget to other budget analysis prepared by advocacy groups and will continue to add links as we receive the information. Some of the references are listed below:
DDS is the state agency providing services and supports to individuals with developmental disabilities. These disabilities include mental retardation, cerebral palsy, epilepsy, autism and related conditions. Services are provided through state-operated developmental centers and community facilities, and contracts with 21 non-profit regional centers. The regional centers serve as a local resource to help find and access the services and supports available to individuals with developmental disabilities and their families.
The Governor proposes to reduce the DDS budget by $200 million:
In addition, similar to what was proposed in the 2009-10 May Revision, the budget reflects a state general fund savings of $200 million in the DDS budget through redirection of California Children and Families Act of 1998 (Proposition 10 funds). The Governor's proposal also redirects $300 million in Proposition 10 funds to Department of Social Services programs. Implementation of this proposal will require voter approval. If approved by the Legislature, it is anticipated this initiative will be included in the June 2010 election.
Regional centers also received an increase of $143.5 million in state dollars because of increased service utilization associated with autism spectrum disorders, for transportation funding, and for growth in regional center caseloads.
The budget proposes to cut $42.7 million in general fund dollars to regional centers, to be replaced by reimbursements from the federal Temporary Assistance for Needy Families (TANF) program. The federal government awards TANF money in block grants to states, which use these funds to operate their own programs. States can use TANF dollars to meet any of the four purposes set out in federal law, one of which is to assist families so that children may be cared for in their own homes or in the homes of relatives.
Finally, the Governor’s budget reduces the staffing levels in the Developmental Centers to coincide with the decrease in the developmental center population.
The Governor’s plan focuses on maintaining Proposition 98 per pupil funding. However, the Proposition 98 guarantee earmarks or requires a minimum portion of the state budget to be spent on K-14 education. The guarantee has been revised and lowered to reflect lower actual revenues than were anticipated in the past two fiscal years. He proposes significant cuts for administrative services funding, such as dollars provided to the local school districts. He also counts some savings based on larger classroom numbers, lower average daily attendance, and lower program costs. His proposal provides $1.5 billion in revenue increases to offset decreased income from property taxes. With respect to children with disabilities, the Governor proposes:
Medi-Cal is California’s version of the state-federal Medicaid program; most Medi-Cal programs are housed in the Department of Health Care Services. The Medi-Cal program provides health care coverage for more than six million low-income children and families as well as elderly, blind, or individuals with disabilities. Medi-Cal is jointly funded by the state and federal government, IHSS is part of Medi-Cal, although it is administered by Department of Social Services (DSS). California receives matching funds from the federal government to finance most of the Medi-Cal program, i.e., the portion that meets federal requirements and is therefore eligible for federal funding.
Ordinarily, the federal government provides 50% of the cost of Medi-Cal services. As part of the economic recovery package enacted by Congress in January 2009, this amount was temporarily increased from 50% to 61.59% to provide the state with fiscal relief. This increase in federal funds saves the state $1.5 billion.
The Governor is asking the federal government to increase the permanent federal matching funds rate by 7%, from 50% to 57%. This would be in addition to the temporary 11.59% increase that is already in effect. He calculates that this will save the state an additional $1.8 billion. (The total federal/state cost of the Medi-Cal program is about $30 billion.) He proposes one set of budget reductions if the federal government does what he asks. He proposes a different set of budget reductions if the federal government does not do what he asks; these are being called “trigger cuts.”
Medi-Cal (other than IHSS) cuts:
Second set of cuts: The governor proposes these trigger cuts if the federal matching rate for Medi-Cal is not increased to 57%, and other federal funding increases are not forthcoming by July 15, 2010:
Community Mental Health Services:
The Governor proposes to reduce the General Fund by $452.3 million for two years and shift funding for the EPSDT(see definition below) supplemental mental health services program and a portion of the Mental Health Managed Care program to the Mental Health Services Act (MHSA/Proposition 63) to make up for the reduction. This would require cuts in programs currently being funded under MHSA and would require amendment of the non-supplantation and maintenance-of-effort provisions of Proposition 63 by the voters. A similar proposal was overwhelmingly rejected by the voters last year. This year, the Governor anticipates the initiative will be included in the June 2010 election.
The MHSA/Proposition 63, passed by voters in 2004, authorized a 1% income tax surcharge on incomes over $1 million. The purpose of the MHSA is to provide funding for innovative community mental health programs to offer support so that people with psychiatric disabilities do not end up institutionalized, in jails or homeless.
Mental Health Managed Care: Counties provide what are called “specialty mental health services” through managed care. These are mental health services that are not provided by physical health care providers or by Medi-Cal fee-for-service providers. These include inpatient hospital services, outpatient mental health services including residential services, and targeted case management. Outpatient services can be provided by psychiatrists, psychologists, licensed clinical social workers, marriage and family therapists, and peer counselors.
Early and Periodic Screening, Diagnosis and Treatment (EPSDT) requires states to provide children with all services listed in the Medi-Cal schedule of benefits that are appropriate for children, as well as all other medical services that are eligible for federal matching funds. These services include Therapeutic Behavioral Services and Therapeutic Foster Care.
In the area of mental health if trigger funds are not received, the Governor proposes to further reduce mental health funding in FY 2010-11 by $847 million with the intent to replace it with MHSA money. This would be a one time shift. Many advocates believe this funding shift will cause the closure of most MHSA programs in FY 2011-12 as there will not be sufficient MHSA funds to continue them beyond FY 2010-11. This proposal will also need approval by the voters in June.
The first set of cuts is proposed whether or not the federal government agrees to increase federal matching funds to 57%. These are not trigger cuts.
Cut $77.9 million in the current fiscal year (2009-10) and $872.6 million in 2010-11 by program changes which are similar or identical to those blocked by federal court injunctions:
Second set of cuts: if the federal matching rate for Medi-Cal is not increased to 57%, and other federal funding increases are not forthcoming, the governor proposes to eliminate the IHSS program.
Reduce the Supplemental Security Income/State Supplementary Program (SSI/SSP) by $21.8 million in 2009-10 and $285.2 million in 2010-11 by cutting SSI/SSP grants for individuals to the federal minimum from $845 to $830 per month (a $15 decrease), saving the state $13.7 million in 2009-10 and $177.9 million in 2010-11. SSI/SSP grants for couples are already at the federal minimum. This change would affect approximately 1 million individuals.
Cash Assistance Program for Immigrants (CAPI) provides cash assistance to immigrant seniors and persons with disabilities who do not qualify for federal Social Security Income (SSI) because of there immigration status. The Governor’s budget eliminates the CAPI program that provides state-only benefits to 10,800 legal immigrants. This results in an $8.1 million savings in 2009-10 and a $107.3 million savings in 2010-11.
A functional index score is a single number that is determined by averaging all of the functional index ranks. The purpose of the score is to provide a single measure of an IHSS recipient’s need for the assistance of another person in carrying out the activities of daily living that are considered in the assessment of need for IHSS services. More specifically, as part of the assessment for services, the county determines the person’s ability to complete certain tasks. The county then gives a “functional index rank” from “1” to “6” for each of the tasks. This ranking, with a weight to consider other factors, is then averaged out. The result is called the “functional index score”.