February 1, 2019 Edition

Budget Committees Hold Informational Hearings on Budget Overview, Emergency Preparedness and Response

The California Legislature continues to ramp up its activities for the 2019-20 Legislative Session with a steady stream of bill introductions and the continuation of issue-based overview hearings. This week, two budget committee hearings were convened to discuss topics that will be deliberated throughout the current session.

Assembly Budget Committee Hearing on FY 2019-20 Budget Overview

On Tuesday, the Assembly Budget Committee held its overview hearing on Governor Gavin Newsom’s FY 2019-20 budget proposal. In opening remarks, Committee Chair Phil Ting indicated that this hearing was the first of over 100 budget committee hearings that will occur over the coming months by the full Assembly Budget Committee and its subcommittees. At the beginning of the committee hearing, the committee heard and advanced two measures – AB 72 (Committee on Budget) and AB 73 (Committee on Budget) – that would provide property tax backfill for specified counties that have been devastated by recent wildfires, provide funding for 911 system and emergency communication infrastructure, and support emergency preparedness and planning activities.

The Assembly Budget Committee hearing featured presentations from Vivek Viswanathan from the Department of Finance (DOF) and Carolyn Chu from the Legislative Analyst’s Office (LAO). Similar to the Senate Budget and Fiscal Review Committee’s overview hearing two weeks ago, presentations from the DOF and LAO covered major components of the governor’s budget proposal and its policy priorities. Viswanathan discussed the Newsom Administration’s top interests, including building fiscal strength and budget resiliency, early childhood and education investments, health care access and affordability, housing and homelessness initiatives, and emergency preparedness and response. Chu provided the LAO’s analysis of the governor’s current economic assessment, budgetary forecasts, and key spending proposals detailed in the Administration’s budget.

Committee members had the opportunity to inquire about elements of the governor’s proposed investments into education, homelessness, health and human services, and disaster preparedness and response, among other areas. Notable health-related questions were raised by Assembly Members Joaquin Arambula and Jim Wood. Recall, both Assembly Members Arambula and Wood co-chaired the Assembly Select Committee on Health Care Delivery Systems and Universal Coverage that was created during last year’s legislative session to explore California’s options for expanding health care coverage and access.

In his comments during Tuesday’s hearing, Assembly Member Arambula applauded the Newsom Administration’s significant investments and health and human services initiatives and inquired about the continuation of the managed care organization (MCO) tax and the administration’s proposal related to prescription drug pricing. Assembly Member Wood inquired about the restoration of previously-eliminated Medi-Cal benefits, health care access, the consideration of services and benefits for older adults, and the nexus between mental health and housing.

Committee Chair Phil Ting at the conclusion of the hearing indicated the topics raised by committee members will continue to be discussed in detail over the coming months through budget subcommittee hearings which will feature ample opportunities for public input on the proposals. Tuesday’s hearing agenda is available here.

Senate Budget and Fiscal Review Committee Hearing on Wildfire and Emergency Response and Preparedness

The Senate Budget and Fiscal Review Committee on Thursday convened an informational hearing on wildfire and emergency response and preparedness in light of recent devastating wildfires that have occurred throughout the state. The hearing featured presentations and extensive dialogue on response and recovery efforts from recent natural disasters, wildfire prevention and natural resource management, and disaster readiness initiatives included in Governor Newsom’s FY 2019-20 Budget Proposal.

Representatives from the Legislative Analyst’s Office (LAO), the Department of Finance (DOF), Governor’s Office of Emergency Services (OES), and the Department of Forestry and Fire Protection (CAL FIRE) discussed emergency response processes and funding mechanisms, recovery and debris disposal activities, emergency notification systems, and first responder personnel, equipment, and resources.

Senators had the opportunity to ask questions of panelists, which largely focused on forestry and fire management, recovery activities, and preparedness initiatives. Several questions were raised related to California’s 911 system and proposed technology upgrades, mutual aid processes and resourcing, and proposed investments related to public education and awareness on disaster preparedness and safety. The full committee hearing agenda, including a wildfire and emergency response and preparedness background paper, is available here.

Covered California Sees Significant Decline in New Enrollment, Points to Removal of Individual Mandate Penalty

On Wednesday, Covered California released its open enrollment figures for 2019 coverage, finding that overall enrollment held steady with more than 1.5 million consumers selecting a health plan. There was a 7.5 percent increase in the number of existing consumers renewing their coverage, but a 23.7 percent decrease in the number of new consumers signing up for coverage for 2019. New enrollment numbers for 2019 came in at 295,980, compared to 388,344 in 2018. The total number of net plan selections for 2019 was 1,513,883 (1,217,903 renewed coverage, 295,980 new coverage). Compared to 2018, there were 7,641 fewer selections, which represents an overall decrease of 0.5 percent.

The 23.7 percent decrease in California was steeper than expected and is higher than the average 15.8 percent drop experienced by 39 states participating in the federally facilitated marketplace. Covered California conducted an analysis of the open enrollment plan selection and demographics compared to last year and found the reduction of new enrollment was relatively evenly spread across all demographics. Slightly larger drops in new enrollment were experienced among Bronze consumers, unsubsidized consumers, and populations in which English is not the preferred spoken language.

As a result of finding that the reduction in new coverage was evenly spread across consumers, Covered California Executive Director Peter Lee indicated that the removal of the individual mandate penalty appears to be a primary driver of the loss of new enrollees. Recall, Congress stripped the Affordable Care Act (ACA) individual health insurance coverage mandate penalty as part of its tax reform measure passed in December 2017; 2019 is the first year the penalty does not apply.

In addition to the individual mandate penalty, other potential factors contributing to the reduction in new enrollment may be continued challenges of health plan affordability and Covered California’s previous success in enrolling healthy consumers. More information on the 2019 enrollment figures from Covered California is available here; a more in-depth issue brief analyzing enrollment and potential impacts is available here.

ONDCP Publishes National Drug Control Strategy

This week, the Office of National Drug Control Policy released its National Drug Control Strategy, detailing the Trump Administration’s priorities for addressing drug use through education and evidence-based prevention, providing treatment to individuals with substance use disorders, and reducing the access to and availability of illicit drugs throughout the United States. The Strategy details the overarching agenda and direction for the federal government to prevent drug use and reduce the number of overdose deaths in the country, particularly related to the ongoing nationwide opioid epidemic.

The Strategy details prevention approaches and treatment and recovery services, including implementing a nationwide media campaign, addressing safe prescribing practices, strengthening the capacity of state, local, and tribal communities to identify and prevent substance use disorders, improving the response to opioid overdose, and expanding access to peer recovery support services. The report was informed by the previously-created President’s Commission on Combatting Drug Addiction and the Opioid Crisis which laid out a series of recommendations and actions for the Trump Administration to address the substance use and opioid crisis. The full National Drug Control Strategy is available here.