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January 22, 2008 - We analyzed certain fiscal issues related to the health care reform (HCR) plan currently under consideration by the Legislature. We estimated the fiscal impact of HCR using two different assumptions of premiums: $250 per month per person and $300 per month per person. Under the $250 premium scenario there are sufficient revenues to support the program in the first year of operation (2010-11). However, by the fifth year of the program, annual costs exceed revenues by $300 million. Despite annual costs exceeding revenues in the fifth year, the program still has a positive cumulative fund balance because the collection of tobacco tax and employer fees start before program costs are incurred. Under the $300 premium assumption, costs exceed revenues by $122 million in the first year of operation and this shortfall increases to $1.5 billion by the fifth year of the program. In addition, the fund balance shows a deficit of almost $4 billion by the end of that period, even with the early collection of the tobacco tax and employer fees. In addition to the premium level, we have identified a number of other fiscal risks and uncertainties which could negatively affect the fiscal solvency of the plan by more than an additional $1.5 billion annually.
October 31, 2007 - Presented to Assembly Health Committee, Mervyn M. Dymally, Chair
October 16, 2007 - Presented to the Assembly Budget Subcommittee No. 1 on Health and Human Services
April 23, 2007 - Presented to: Assembly Budget subcommittee No. 1 on Health and Human Services
March 28, 2007 - Presented to Assembly Budget Subcommittee No. 1
March 6, 2007 - Presented to Assembly Human Services Committee
February 21, 2007 - The Governor proposes to extend health care coverage to California’s uninsured population and to implement specific reforms. The Governor’s proposal would impose an individual mandate requiring all Californians to maintain a minimum level of health insurance, attempt to contain health care costs so that individuals could afford to purchase coverage, and promote various measures meant to improve the overall health of Californians. We conclude that the Governor has presented a comprehensive framework to expand coverage for the uninsured. In addition, the administration has made a serious effort to estimate the programmatic and fiscal impacts of its proposal. We identify a number of legal obstacles and policy issues and conclude that the plan creates fiscal risks to the state potentially reaching several billions of dollars annually.
February 21, 2007 - The budget plan implements Chapter 241, Statutes of 2006 (SB 162, Ortiz) that creates a new Department of Public Health (DPH) and Department of Health Care Services (DHCS) from the existing Department of Health Services. We recommend the Legislature require the administration provide additional information to ensure cost neutrality as required under Chapter 241.
February 21, 2007 - We estimate a shift of veterans from Medi-Cal to the federal Veterans Administration (V.A.) health system could save the state up to $250 million annually, while providing those veterans with quality health care services. We recommend that California join 42 other states participating in a federal data matching process that would facilitate achieving these goals.
February 21, 2007 - We review the proposal for a net reduction of $25 million for Proposition 36 programs, discuss why this reduction might eventually result in increased prison costs, and recommend redirecting funds in order to support Proposition 36 programs at their current level.
February 21, 2007 - Although the quality assurance (QA) initiative for In Home Supportive Services (IHSS) has improved the accuracy and standardization of service hour authorizations by social workers, there are limited controls assuring that recipients receive their service hours in accordance with their case plan. We review the department’s implementation of the QA initiative, and provide recommendations to enhance program integrity and increase the likelihood that recipients receive services in accordance with their case plans.
February 21, 2007 - In order to increase work participation to avoid federal penalties, the Governor proposes new time limits and sanctions on children whose parents cannot or will not comply with CalWORKs work participation requirements. However, under the budget’s own assumptions, California will meet federal participation requirements by FFY 2008. Thus, these policy changes are not needed to avoid federal penalties, and we recommend their rejection. We offer an alternative to the Governor’s full-family sanction proposal.
February 21, 2007 - California has made significant changes in the CalWORKs program in order to increase work participation among recipients. Estimates by the administration of the participation increases associated with recent policy changes, in conjunction with the caseload reduction credit, suggest that California would likely be in compliance with federal work participation requirements in federal fiscal year 2008.
February 21, 2007 - In 2005 the Department of Finance (DOF) began an information technology (IT) project to replace the state’s budget system. After interviewing departments’ financial staff, DOF has concluded the project needs to be expanded because most state department automated financial systems are old and do not support modern financial reporting requirements. The Governor’s budget proposes a $1.3 billion IT project over the next decade to develop a statewide financial system that would be used by all departments. Our analysis discusses the primary components of this project proposal, key issues the Legislature should consider in evaluating the project, and recommends additional oversight tools if the Legislature decides the project should go forward.