Amidst anxiety about potential federal funding cuts to health programs, California has one bright spot. The state’s new tobacco tax is expected to generate about $1.2 billion next fiscal year for the state’s low-income health program.
Now, California legislators and Gov. Jerry Brown are battling over how to spend the money.
Immigrant rights’ advocates are asking the state to use a portion of the Proposition 56 funding to expand health coverage to undocumented young adults.
In May 2016, California allowed undocumented children to enroll in Medi-Cal, the state’s low-income health program. Advocates would now like to expand that coverage to young adults, ages 19 to 26, regardless of their immigration status.
The expansion is backed by Health Access, a health care consumer advocacy group, and the California Immigrant Policy Center, an advocacy group for immigrants’ rights. The coverage is estimated to cost between $54 and $86 million annually, depending on how many young adults enroll and when the coverage begins. Between 50,000 and 80,000 Californians would likely qualify for the coverage, according to Health Access.
Both the state Assembly and Senate have agreed to the proposal, voting along party lines. But Brown has proposed using the new tax money to pay for existing Medi-Cal costs, instead of expanding coverage.
In the coming days, the legislature hopes to convince the governor to sign off on the proposal for young adults or to come up with a compromise, said Rachel Linn-Gish, director of communications for Health Access.
The negotiations will take place in the next two weeks. The budget must be finalized with the governor’s signature by June 15.
As it stands, the proposal would provide Medi-Cal to young adults, regardless of immigration status, whose incomes are at or below 138 percent of the federal poverty level. A single young adult with an annual income of $16,395 or less would qualify for the health coverage.
The Assembly has proposed that the coverage start next fiscal year, while the Senate has suggested the following fiscal year. A legislative committee is working to come up with a unified proposal from the legislature to present to the governor.
Proposition 56, approved by voters last November, increased the tax on tobacco products by $2. After allocating some money to certain state programs, such as the UC system for physician training, and other administrative costs, the law requires 82 percent of the remaining funds to be spent on Medi-Cal.
The federal Affordable Care Act opened the gates of Medi-Cal to many low-income adults. However, the majority of those who are undocumented remain ineligible for the coverage.
“We believe our health system is stronger when everybody is included,” said Anthony Wright, Health Access executive director. “Especially for kids and young adults who are just starting out in their life—this is an investment in our state and community to keep our burgeoning workforce healthy.”
Undocumented young adults often have entry-level jobs that don’t provide health insurance, he said.
If the legislature and governor agree on a plan to expand Medi-Cal coverage to undocumented young adults, the proposal could still vaporize if Congress or President Donald Trump cut funding for the federal Medicaid program, Wright said.
“We don’t know what will come out of D.C.,” he said. “What we do know is we did pass Prop 56, and we need to continue the work and path we’re on to try to improve our health-care system and Medi-Cal.”
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