CaHPSA E-Newsletter: Health Investments in 2020-21 State Budget Proposal

A state’s budget process begins every year with the introduction of a budget proposal by the Governor. Included in the proposal document are funding recommendations that highlight issues that the Governor deems important for the state’s advancement. The State Legislature, which consists of the Senate and House of Representatives, reviews the budgetary priorities outlined in the Governor’s initial budget proposal. The proposal undergoes revisions and is voted on by the Legislature. Once it is passed, the Governor signs the final budget in the summer.

What's in California's proposed state budget for 2020-21?

On January 10, 2020, Governor Gavin Newsom released the 2020-21 state budget proposal. Health-related funding accounts for nearly 23% of the $222.2 billion proposed budget. In this initial budget proposal are significant investments in health reform, including improvements in access, coverage, and affordability.

This newly released 2020-21 California state budget proposes funding for the following healthcare-related items:

Creation of a new Office of Health Care Affordability to improve cost transparency.
Strengthening of Covered California, the state’s health insurance marketplace, by improving affordability, plan options, and enrollment.
Launch of a new state generic drug label to compete with high market prices of pharmaceutical drugs. The goal is to reduce prescription drug costs.
Expansion of full-scope Medi-Cal to all income-eligible seniors age 65 and over, regardless of immigration status. This is expected to extend coverage to more than 25,000 low-income seniors.

Notably, the inclusion of Medi-Cal expansion to low-income undocumented seniors brings California another step closer to universal health coverage.

The health investments proposed in the new 2020-21 state budget build on funding priorities and legislative achievements of previous years. For example, last year’s state budget included funding to strengthen the Affordable Care Act by reinstating the individual mandate. Last year’s final budget also improved access by expanding Medi-Cal eligibility to undocumented young adults ages 19-26. In 2016, Governor Brown expanded full-scope Medi-Cal to low-income undocumented children. As a result of both budgetary and legislative efforts, more than 120,000 young children gained comprehensive health coverage in 2016 and around 90,000 low-income young adults became eligible for full-scope Medi-Cal in 2020.

As health justice advocates, CaHPSA applauds past efforts to improve health coverage and celebrates the additional investments in health proposed in the new 2020-21 state budget! We will continue to advocate for improvements to our state’s healthcare system so that it is truly universal, equitable, and sustainable.