State policy makers had been hoping for 1.8 billion dollars as part of the FMAP package. Instead, the U.S. Senate approved 1.28 billion dollars.
The House of Representatives, which originally passed the 1.8 billion dollar package, still has to pass the Senate bill. Speaker Nancy Pelosi says that can happen as early as next week.
For months, GOP Senators filibustered the 26 billion dollar funding measure. They opposed the bill because of deficit and other spending concerns.
Governor Arnold Schwarzenegger, along with other state governors, lobbied extensively for the money. In a statement, Schwarzenegger praised the Senate:
“The critical need for this…cannot be overstated. For years, California taxpayers have been shortchanged billions of dollars from the federal government. This federal funding is a down payment on what California is owed.”
Traditionally, the state and federal governments split the costs of paying for Medi-Cal. As part of the stimulus spending package passed in 2009, President Barack Obama pushed through a cost split where the federal government pays for just over 61% of Medi-Cal services, with the state and local governments picking up the rest.
To help gain the support of two GOP senators, there were revisions to how the state and the federal governments share the costs of Medi-Cal.
In the newly approved formula, the federal government would pay 59% of the costs until April, and then 57% of the costs until July. After that, the state and federal governments would split the bill 50-50.
For state lawmakers looking to balance a 19 billion dollar budget shortfall, that’s less than was widely anticipated.
“We’ll be getting about 2/3rds of what was projected at the time that the Governor issued his revised budget in May,” says the California’s Department of Finance H.D. Palmer. “That said, even though it is not the 1.8 billion dollars that was hoped for… this means we will not have to put an additional 1.3 billion dollars in reductions [to the state’s budget] on the table.”
Which means money for education or other services won’t be shifted to pay for Medi-Cal. The bill also includes 1.2 billion dollars to local California governments for education funding.
“What we were able to do is send enough funds to California to save 16,000 teacher jobs,” says U.S. Democratic Senator Barbara Boxer, who voted for the bill. “It’s a very good day, and I’m very relieved we were able to get this done.”
This funding is important to doctors who treat Medi-Cal patients. One in five Californians are covered by Medi-Cal. The California Medical Association, which represents doctors in the state, was lobbying for full Medi-Cal funding. And while state policy makers are relieved with the funding, the CMA’s Elizabeth McNeil says the 500 million dollars stripped by the U.S. Senate is required to meet the long term needs of the state’s poor and unemployed.
“Because the economy is in the tank in this state,” McNeil says, “We have more and more people who have sought out Medi-Cal, and we need a lot more money to shore up our program.”