H˚ˇÙ̯ ˇÚ¸ HÏÛˇÚ S˚ÔΘ˝˚Ó - California

1 H H S The Health and Human Services Agency oversees departments and other state entitiesthat provide health and social services to California s vulnerable Budgetincludes $ ($ General Fund and $ other funds) forall health and human services expenditures for each majorprogram area and FigureHHS-02displays program H S G ' B S 2018-1953F U The federal administration and leaders in Congress continue to consider and propose numerouschanges to health and human services of the proposals could havefar-reachingimpacts on health care in California with significant impacts to Medicaid ( medi -Calin California ).

2 medi -Calis a federal program thatprovidescomprehensive health care to Medicaid proposals have included reductions to federalfunding for the Affordable care Act's (ACA) expansion population, a block grant structure forMedicaid programs, cappedper-beneficiaryallotments to states, tax credits to enroll Medicaidbeneficiaries in private insurance, and creation ofhigh-deductibleplans for the Medicaidprogram combined with health savings is not clear whether changes will ultimatelybe approved or when they wouldtake such, the Budget continues to reflect existingstate and federal complete repeal of theACA, without a companion replacementprogram, would not only affect millions of Californians health benefits andthe state and localhealth care delivery system.

3 But would also disrupt the private insurance ACA alsorequired individuals to buy health insurance or pay a tax penalty as an incentivefor younger and healthier people to sign up for health care and make it more California , the state s health insurance marketplace, has provided individual healthinsurance through private plans supported by federally funded tax subsidies and products forindividuals and small businesses since isaself-sustainingentity funded through feeshDsjD82tKrgAH H S 54G ' B S 2018-19assessed on the participating health federal tax reform bill, passed inDecember2017, eliminated penalties for the individual mandate starting in of theindividual mandate may result in disruptions to the health care market in October 1, 2015 through September 30, 2019.

4 The ACA increasedthe federal share ofcost for the Children s Health Insurance Program (CHIP) from the historical rate of 65 percent to88 , the federal funding was only appropriated throughSeptember requires California to continue coverage for most of the children currently under CHIP through September 2019,but absent congressional reauthorization, the state would receiveonly a50-percentfederal share for this passed legislation in lateDecember 2017 to temporarily fund CHIP at 88 percentthrough early tothis lateaction, the Budget reflects an88-percentfederal share only through December 31, 2017, and65percent as of January 1.

5 Is consistent with the 2017 Budget Act's MayRevision will, at a minimum,include savings of approximately $150million GeneralFundto reflect temporary federal funding authorized after the Budget was approximately 32,000 pregnant women and children is at risk if CHIP funding is not providedbeyond March 2018 because they do not qualify for federally funded, addition, other recent federal proposals have included reductions in funding for other healthand human services programs including the Social Services Block Grant, Promoting Safe andStable Families, and Preventive Health and Health Services Block Grant of thechanges being considered by the federal administrationare unknown but could have asignificant fiscal impact on the state H S M C Since 2011, there have been many changes in the programs that provide a safety net forCalifornia s vulnerable children, adults, and provision of health care was expandedsignificantly, increasing the number of individuals receiving coverage throughMedi-CalandCHIP from millionto nearly million.

6 This increase includes the expansion of full medicalcoverage to undocumented addition, millionpeople receive medical coveragethrough Covered of the program reductions from the Great Recession have been restored, including mostoptional benefits in theMedi-Calprogram, such as dental benefits for adults and enteralnutrition, as well as funding for the Department of Social Services to increase the frequency oflicensed community care facility increases have also been made toprovidecost-of-livingincreases for CalWORKs and the Supplemental Security Income/StateSupplementary Payment (SSI/SSP).In addition, the CalWORKs maximumfamily grant rule H S G ' B S 2018-1955 The focus for many of these programs has also shifted to improve the lives of those thatreceive example, the CalWORKs program emphasizes employmentandnowprovides greater flexibility for participants to meet program requirements during the first24 months ofwelfare-to-workparticipation by.

7 (1)providing funding for family stabilization toremove barriers to employment,(2) expanding the number of child care slots, and (3)increasingchild care provider programmatic changes have allowed the state to meet federalwork participationrequirements avoidingover $ billionin potential foster care ,the state beganthe Continuum of care Reform to improve assessments of children andfamilies for placement considerations, with an emphasis onhome-based, family careplacements with supportive services rather than group home care , thestate announced the planned closure of three remaining developmental centers.

8 Sonoma,Fairview and the general treatment area of Porterville, and instead will focus on providingservices to these individuals incommunity-basedresidential focus has been the integration of physical and behavioral health. With the eliminationof the Department of Mental Health and the Department of Alcohol and Drug Programs,oversight ofcounty-operatedcommunitybehavioral health programs shiftedto the Departmentof Health care transition encouragedprograms to work together to address aperson s wholehealth physicalhealth, behavioral health, and substance use , substance use services have been expandedin DrugMedi-Caland at the county levelas part of the Organized Delivery System.

9 The tax structure enacted in 2016 for managed care plans provides net statewiderevenues totaling nearly $ allowsadditional funding to be used toprovide developmental services provider rate increases and other program investments, whichwill total $ funds also allowed for restoration of a7-percentreduction ($302 million) in hours in theIn-HomeSupportive Services program (IHSS), andprovided the nonfederal share ofMedi-Calmanaged care rates for health care services providedto children, adults, seniors, persons with disabilities, and persons eligible for tax structure is authorized through June30, T I (P 56)The California Healthcare, Research and Prevention Tobacco Tax Act of 2016 (Proposition 56)

10 Raises the tax on cigarettes from $ to$ perpack andexpands this taxto 56 requires specified backfills for Proposition 99, Proposition 10, theBreast Cancer Fund, and to state and local governments to offset tax revenue decreaseshDsjD82tKrgAH H S 56G ' B S 2018-19resulting from the additional backfills, remaining funds are allocated pursuant to aspecified formula, including 82 percent of the funds for transfer to the Healthcare TreatmentFund forMedi-Calprovider payments and growth in theMedi-Calprogram compared to the2016 Budget revenues from this tax increase for2017-18, which include one quarter of2016-17revenues and backfill amounts, are nearly $ revenues for2018-19are$ backfills of $ millionand other allocations outlined in FigureHHS-03, theBudget includes health care treatment expenditures totaling $ , theBudget allocates $ millionin2018-19, an increase of $ million.