June 1, 2018 Edition

CHHS Secretary Dooley Appointed Governor Brown’s Executive Secretary

On Thursday, Governor Jerry Brown announced California Health and Human Services (CHHS) Secretary Diana Dooley has been appointed his executive secretary. The role of the executive secretary ostensibly serves as the chief of staff in the governor’s office. The position was previously held by Nancy McFadden who passed away in March following a battle with ovarian cancer.

Dooley has served as CHHS Secretary since 2011 and previously worked as the legislative director and special assistant in the Office of Governor Brown from 1975 to 1983. Michael Wilkening has been appointed CHHS Secretary where he has served as undersecretary since 2008. Michelle Baass will assume the Wilkening’s previous role as undersecretary; Baass has served as deputy secretary of the CHHS Office of Program and Fiscal Affairs since 2017.

The full press announcement from Governor Brown is available here.

AB 626 Set for Hearing on June 13 in Senate Health Committee

AB 626 (E. Garcia) has been set for hearing on Wednesday, June 13 in the Senate Health Committee. The measure seeks to create a new type of food facility defined as “microenterprise home kitchens” in the California Retail Food Code and allow the sale of potentially hazardous foods directly to consumers in private homes. The measure was previously amended to provide additional exemptions to microenterprise home kitchens related to enforcement, health, and sanitation requirements.

CHEAC is opposed to the measure in light of food safety and enforcement concerns expressed by many jurisdictions. HOAC, CCDEH, CSAC, UCC, and RCRC are also opposed to the measure. We strongly encourage LHDs to secure an official oppose position on AB 626, update and send in letters of opposition to your legislators, and contact Senate Health Committee Members. CHEAC will continue to provide updates to members as the hearing date nears.

Legislature Concludes Weeklong Floor Only Session

Today marks the deadline for the California Legislature to pass all bills out of their house of origin. Both houses maintained a significant bill load, working their way through over 80 bills each day this week. While some bills met their fate in their house of origin this week, many more were advanced onto the next chamber.

Below we highlight significant actions of interest to CHEAC Members. For a full update, our CHEAC Weekly Bill Chart is available here.

Access to Health Services

SB 1125 (Atkins) as amended on May 25, 2018 – Support

SB 1125 by Senate President pro Tempore Toni Atkins was advanced from the Senate to the Assembly this week. The measure would authorize Medi-Cal reimbursement to federally qualified health centers (FQHCs) and rural health centers (RHCs) for a maximum of two visits on the same day at a single location if the patient has a medical visit and a mental health or dental visit. SB 1125 is sponsored by California Health+ Advocates and the Steinberg Institute.

Health Coverage/Health Care Reform

AB 2430 (Arambula) as revised on April 4, 2018 – Support

Assembly Member Joaquin Arambula’s AB 2430, which would increase Medi-Cal eligibility for seniors and disabled individuals up to 138 percent of the federal poverty level (FPL) was advanced from the Assembly to the Senate. This measure would create consistency in eligibility for these individuals, and the measure is part of the package of measures by the Assembly Select Committee on Health Care Delivery Systems and Universal Coverage. Funding for this expansion is included in the Assembly’s budget and is included as a Budget Conference Committee item.

AB 2965 (Arambula) as amended on May 25, 2018 – Support

AB 2965 by Assembly Member Joaquin Arambula was scaled back last week to move the measure from the Assembly Appropriations Suspense File. The measure initially would have expanded Medi-Cal to all undocumented adults with incomes at or below 138 percent FPL, but it was amended to narrow Medi-Cal eligibility to undocumented adults under 26 years of age with incomes at or below 138 percent FPL. This amendment conforms to the budget proposal approved by the Assembly Budget Committee and is included as a Budget Conference Committee item. AB 2965 was advanced from the Assembly to the Senate.

SB 974 (Lara) as amended on May 25, 2018 – Support

Senator Ricardo Lara’s SB 974 was similarly narrowed last week to move the measure from the Senate Appropriations Suspense File. Originally proposing to expand Medi-Cal to all undocumented adults with incomes at or below 138 percent FPL, SB 974 would now expand eligibility to undocumented adults 65 years of age and older with incomes at or below 138 FPL. This amendment also conforms to the budget proposal recently passed by the Senate Budget and Fiscal Review Committee and is also included as a Budget Conference Committee item. SB 974 was advanced from the Senate to Assembly this week.

SB 945 (Atkins) as introduced on January 29, 2018 – Support

SB 945 by Senate President pro Tempore was advanced from the Senate to the Assembly this week. The measure would eliminate the coverage period currently in place in the Breast and Cervical Cancer Treatment Program (BCCTP) and would instead require treatment services to be provided for the duration of treatment as long as the individual remains eligible for the program. A corresponding budget request was included in the Senate’s budget and is now included as a Budget Conference Committee item.

Tobacco Control

SB 835 (Glazer) as amended on March 20, 2018 – Support

SB 836 (Glazer) as amended on May 15, 2018 – Support

Both SB 835 and SB 836 by Senator Steven Glazer were advanced from the Senate to the Assembly this week. SB 835 would ban smoking and disposal of cigar and cigarette waste at all state parks. SB 836 would ban the same at all state coastal beaches. CHEAC supports both measures to reduce the harmful effects of tobacco products.

Assembly Adopts 2018-19 Budget Package

On Tuesday evening, the full Assembly Budget Committee convened a hearing to discuss and adopt their 2018-19 Budget. In his opening statements Assembly Member Philip Ting, chair of the Assembly Budget Committee, noted their inclusion of $144 billion in revenues and $140 billion in expenditures. He further highlighted major investments by the Assembly, which include:

  • $17.1 billion to total reserves;
  • $1 billion for health care expansion and reducing health care costs for middle income families;
  • Fully funding the Local Control Funding Formula for education;
  • Providing $117 million to UCs and $226 million to CSUs above the Governor’s May Revise proposal;
  • $1.6 billion to address homelessness in California
  • $920 million, including federal funding, to support early childhood education programs;
  • $153 million to support the census count; and
  • Expanding the Earned Income Tax Credit to younger adults.

Assembly Member Jay Obernolte, vice chair of the Committee, commended the work of the subcommittees; however, he expressed fundamental concerns with some of the investments included in the budget, arguing that a dollar spent today should equal lower spending in future years. He expressed concern that the investments included in the Assembly’s budget would create additional spending pressures in future years. Lastly, he questioned the intent and expressed concern with the creation of a new reserve in addition to the existing reserve accounts – the Budget Deficit Savings Account (Rainy Day Fund) and Special Fund for Economic Uncertainties.

Assembly Member Joaquin Arambula, chair of Assembly Budget Subcommittee No. 1 on Health and Human Services provided a report on the work of the subcommittee, which convened 18 public hearings. He remarked that this was a precedent setting year for health with a $1 billion investment to expand coverage to all low-income young adults and increase the eligibility for the aged and disabled. He noted this investment moves the state toward universal coverage and making health care accessible for all Californians. He went on to note the following additional investments:

  • Investing $65 million into public health prevention of sexually transmitted diseases, opioids, HIV/AIDS, diabetes, hepatitis C, and Valley Fever;
  • Providing premium assistance for middle income families;
  • Creating an all-payer database to collect cost data and increase transparency;
  • Investing in the health care workforce for medically underserved and shortage areas;
  • Investing in provider rate increases using $50 million from Proposition 56; and
  • Expanding eligibility and making the CalWORKs home visiting program permanent;

The Department of Finance cautioned against the architecture of the Assembly’s budget given the revenues used in the Assembly’s proposal are $2.8 billion over the Administration’s revenue estimates. The Assembly Budget Committee moved forward with the adoption of the 2018-19 Assembly Budget; however, Assembly Member Ting noted their interest in continued discussions with the Administration during the conference process.

An overview of the Assembly Budget and subcommittee reports can be found here.

2018 Budget Conference Committee Hearings Begin

The work of the Budget Conference Committees began this week with an overview hearing to discuss differences between the two houses and Administration. Assembly Member Philip Ting, chair of the Budget Conference Committee, provided highlights of the Assembly Budget during his opening comments and announced the Committee’s intent to reconcile the differences by the end of next week. Senator Holly Mitchell’s opening comments were simply “Let’s rock and roll”.

Mac Taylor from the Legislative Analyst’s Office (LAO) walked the legislature through their Conference Committee Overview. Key areas discussed are noted below:

Revenues. The LAO noted the Legislature’s adoption of the LAO’s revenue estimates. There’s a slight difference between both houses, resulting from the Assembly not adopting the LAO’s corporate tax revenue estimate; however both houses adopted revenues just shy of $3 billion over the Administration’s estimate.

Reserves. Both houses took action consistent with the Administration’s action to fully fund the Rainy Day Fund at the constitutional target. Above that, the Senate dedicated $1 billion and created a new safety net reserve intended to stabilize any decreases to safety net programs in the event of a recession. The Assembly took a different approach and created a new reserve to hold funds until the end of the fiscal year, where the funds would then be transferred into the Rainy Day Fund if unused. The LAO noted the healthy level of reserves could withstand a mild recession and in the even of a larger economic downturn, could provide time for adjustments.

Spending. The LAO acknowledged the differences between the approach of both houses and the Administration in the balance of one-time spending versus ongoing commitments. One-third of the Senate’s expenditures are for one-time obligations compared to one-half of the Assembly’s commitments. He further indicated major ongoing commitments by both houses that would grow over time, which include CalWORKs for the Senate and health expansion costs for the Assembly. The LAO recommended an approach that balances ongoing commitments with increased reserves.

Amy Costa from the Department of Finance raised serious concerns with the adoption of the LAO’s revenue estimates due to the volatile nature of both the personal income tax and corporate gains. As a result, many of the augmentations will likely note be supported by the Administration given the revenues.

A second hearing was held on Thursday and focused on K-12 and Higher Education. The Conference Committee is expected to reconvene on Monday, June 4 and move to health and human services items next. The LAO Overview of HHS items and Conference Committee agenda can be found here.