(San Francisco, CA) – The California State Legislature approved a bipartisan agreement today to reform health and developmental services funding through restructuring a tax paid by managed care organizations to preserve access to federal funds. The agreement was reached within a special session of the Legislature convened by Governor Jerry Brown last June.
“This deal will save lives by ensuring that more vulnerable Californians get the care they need,” said Assemblymember Phil Ting (D-San Francisco). “It took years to revisit tough cuts to health care and developmental services made during the Great Recession and months of work to put this agreement together. Today’s vote is not a Leap Day miracle. It’s just the right thing to do. Let’s keep our momentum going, strike while the iron is hot, and find a way to fund our state’s unmet infrastructure investment needs.”
Since 2005, California has imposed health care-related taxes on managed care plans that contract with the state to provide services to Medi-Cal beneficiaries. In 2014, California was advised that this tax structure was inconsistent with federal requirements to draw down matching federal funds.
Brown’s special session declaration is available at www.gov.ca.gov/docs/6.16.15_Health_Care_Special_Session.pdf.
Further information about the agreement – AB2x 1 (Developmental Services), SB2x 2 (MCO Tax Reform), and SB 86 (Budget) – is available at www.leginfo.ca.gov.