Last week’s revised state budget proposal (read our response here) left many advocates frustrated and disappointed. Instead of proposing new ways of generating revenue in an equitable manner and directing high-profit corporations to pay their fair share, the governor would rather cut funding from crucial programs that benefit people on the lower end of the wealth spectrum.
Make no mistake: When it comes to child health equity, there is never any time to waste. Gov. Newsom’s multi-year strategy to balance the state’s budget would leave children and youth – especially those from historically marginalized communities of color – behind in everything from equitable access to health care coverage and mental health care, to early education opportunities and reliable, affordable internet.
The Children’s Partnership’s policy directors dug through this misguided proposal to provide their analyses and recommendations for a budget that would get us closer to “A California for All.”
Mental Health
With increasing pressures on the state and counties to solve the severe affordable housing crisis by redirecting behavioral health investments downstream to treating severely mentally ill adults, now is not the time to walk back the state’s commitment to building an adequate and responsive behavioral health system that prioritizes upstream prevention and early intervention. Honoring this commitment would meet the needs of California’s historically marginalized children and youth before they become our state’s severely ill homeless population.
Angela M. Vázquez, Policy Director, Mental Health
Key Points
- Youth Mental Health: $426 million in cuts to the $4 billion Children and Youth Behavioral Health Initiative (CYBHI) over three years.
- When voters passed Proposition 1’s reforms to the Mental Health Services Act in November 2023, the Administration emphasized that investments made through the CYBHI would restore any county investments that were redirected from children’s prevention and early intervention services to housing services for adults. Cutting CYBHI funds will put increasing pressures on counties to focus on downstream initiatives at the continued expense of upstream services for children and youth. This would put kids at risk of delayed access to care and increased disparities in mental health outcomes, including suicide, for youth of color.
- We are especially concerned about the proposed $47.1 million in cuts to the CYBHI Evidence-Based and Community-Defined Practices grants. These cuts are most likely to impact the yet-announced final grant round that was intended to fund youth-related community-defined practices. California’s work to broaden access to culturally responsive healing services has largely focused on adults. Cutting this particular grant round closes off an important path to healing for California’s youth of color, who represent the majority of young people in our state.
- Multi-Payer Fee Schedule: We are grateful for the Administration’s preservation of the Multi-Payer Fee Schedule investments, which provides a new revenue stream to pay for school-based mental health services. This remains an essential effort to translate the one-time investments of the CYBHI into long-term expanded access to the mental health system of care for our state’s kids.
Early Childhood Development
As an early childhood advocate, it is disappointing to see the health and well-being of California’s babies and toddlers are not a priority in California’s budget plan. Access to preventive care during the most critical and formative years for our babies, from the prenatal period to age 3, is essential, as is securing investments that will guarantee access to quality early care and education. California should not be looking for opportunities to reduce funding to crucial programs necessary for the well-being of all children, but rather seek creative solutions to uphold programs that set California apart from the rest of the nation – giving our youth, babies and toddlers the resources they need to live healthy lives and thrive.
Eva Rivera, Policy Director, Early Childhood Development
Key Points
- Workforce: Eliminates more than $850 million over five years from various health care workforce initiatives, including community health workers, nursing and social work. A rate increase for CHWs is not a possibility as a result of these reductions.
- Eliminating funding to support the workforce that cares for our youngest Californians and their families means families will have to wait even longer to access necessary services.
- Preschool, Transitional Kindergarten and Full-Day Kindergarten: Reduces a planned 2025-26 investment of $550 million that would have supported the California Preschool, Transitional Kindergarten, and Full-Day Kindergarten Program translates to about 81,000 state-subsidized child care slots that won’t be available by 2026 as planned. The number is part of an agreement between the state and child care providers union to reach 200,000 subsidized child care slots.
- Families cannot wait to access the quality child care they need so parents/caregivers can enter the workforce or attend school. Access to child care can make the difference for a family that needs to choose between paying rent or putting food on the table.
- Parent-Child Care: Reduces the Medi-Cal dyadic services benefit.
- The dyadic services benefit allows families to receive holistic and family-centered care. A reduced investment in these services impacts the ability to treat parents and children as the unit they are. When these services are offered, rates of maternal depression decrease, there is greater security of attachment, fewer child behavior problems, higher child social-emotional development scores, and better rates of attending well-child visits.
Social Drivers of Health
Evidence shows that about 80% of our health outcomes are driven by the social conditions in which kids and families live, learn and play. So we are troubled by the deep cuts to programs that support public health, digital equity and a strong safety net, among others. In particular, as Califorians grapple with a devastating affordable housing and homelessness crisis, the governor proposes to slash the very funds needed to alleviate this crisis. We call on the legislature to reject these cuts. And given the state’s budgetary challenges, it’s more important than ever that the legislature and governor place AB 1657 on the ballot to allocate $20 billion of bond funds to advance real affordable housing solutions.
Maddie Ribble, Policy Director, Social Drivers of Health
Key Points
- Digital Divide: Cuts $2 billion from broadband investments needed to ensure equitable access to reliable, affordable internet for all Californians and close the digital divide, which disproportionately impacts families of color and low-income communities. This includes a zeroing out of $1.5 billion that the governor proposed in his January budget to complete the Middle Mile Broadband Initiative, as well as a $500 million cut to the Loan Loss Reserve Program that expands the ability of local governments, tribes and non-profits to finance local broadband infrastructure. We stand with our allies at the California Alliance for Digital Equity in calling for a reversal of these cuts.
- Housing Justice: We are pleased that the May Revise continues funding for the state’s Low-Income Housing Tax Credit, which helps housing providers build homes affordable to the state’s lowest-income households. However, other housing and homelessness programs are subject to devastating cuts in the governor’s latest budget proposal. This includes the $1.76 billion in cuts to programs including the Homeless Housing, Assistance, and Prevention Program (HHAP); the Multifamily Housing Program; the Foreclosure Intervention Housing Preservation Program; and the CalHome Program. We join a multi-sector coalition of affordable housing, homelessness and housing justice advocates in calling out the severe harm these cuts will cause to California families. The dire budget situation only intensifies the importance for the legislature and governor to place AB 1657, a $20 billion affordable housing bond, on the ballot this year.
- Economic Security and Safety Net Programs: We are pleased that the May Revise protects progress made on anti-poverty tax credits for low-income families, including the CalEITC, Young Child Tax Credit (YCTC) and Foster Youth Tax Credit (FYTC). However, the May Revise proposes significant cuts to the safety net, including to CalWORKs, foster youth support and immigrant services, as well as delays to food aid and child care. Together with End Child Poverty California, we implore the governor not to cut programs that are effective at reducing child poverty.
Health Care
Let’s be clear–this is not a preservation budget for our children. Young children’s Medi-Cal coverage will not be protected, resulting in children wrongfully losing their coverage. Even short gaps in coverage for young children can harm healthy childhood development when they cannot access timely early developmental screenings and intervention. This budget decision steps away from the state’s obligation to provide coverage to these eligible children. The governor’s proposed cuts to community and clinic navigators, who help families through the annual Medi-Cal renewal process, will only exacerbate the problem of wrongful Medi-Cal disenrollments. Also, the governor proposes to eliminate the In-Home Supportive Services benefit in Medi-Cal for those children who qualify for Medi-Cal regardless of immigration status. These families will be losing their ability to take care of their child with special health care needs at home.
Kristen Golden Testa, Policy Director, Health Care
Key Points
- Multi-year Continuous Medi-Cal Coverage for Young Children: Does not fund multi-year continuous Medi-Cal coverage for children ages 0-5. Despite policymakers having taken steps to implement this policy enacted two years ago, funding is required to preserve young children’s continuous Medi-Cal coverage. Continuous Medi-Cal coverage guarantees access to crucial preventive care during the most critical formative years for our youngest Californians. Without this coverage protection, 1.2 million young Medi-Cal children are at risk of wrongfully losing their Medi-Cal.
- CHW Rate Increase: Does not fund a rate increase for community health workers, promotoras and representatives. The proposed increase would have raised the CHW base rate to at least 87.5% of the Medicare rate and put the increase on par with other proposed provider rate increases. CHW/P/Rs are a vital workforce and health equity strategy, as they are trusted community members who can connect particularly marginalized families with the health care they need. Instead, the governor proposes to further halt our progress to integrate CHW/P/Rs by reducing critical CHW training dollars. Our workforce deserves to have wages and training opportunities that support them and their families and allow them to serve as the important community connectors they are.
- In-Home Services: Removes the In-Home Supportive Services benefit for Health4All-eligible individuals of all ages, including children. IHSS payments allow families to be paid to stay home and take care of their children with special health care needs. An estimated 18,000 enrollees could be impacted if benefit funding is eliminated. Without these payments, families will be in a bind: either face financial ruin, or return to work and not have care for their children with special health care needs.
- Navigator Workforce: Cuts $18 million for community navigators, including Medi-Cal enrollment and renewal assisters, and $8 million, or a 30% reduction, for clinic navigators. Navigators provide vital support and assistance to families in enrolling and renewing their Medi-Cal coverage. Without their support navigating a confusing health care system, many families will likely lose their coverage unnecessarily.
- Provider Rates: Removes funding in 2025 for provider rate increases as was previously agreed to in the Managed Care Organization tax deal. California has embarrassingly low Medi-Cal rates for providers, which significantly impacts access to care. These rate increases were intended to bridge this gap in access to health care for Medi-Cal enrollees.
- Equity Grants: Eliminates the remaining $280 million available for equity and practice transformation grants, including funding for already awarded grants, to certain Medi-Cal providers to improve quality, health equity, behavioral health integration and primary care infrastructure. Pediatric providers that rely on this funding to create a more whole-child approach to care delivery (e.g., incorporating CHWs into their practice or building in referrals to health-related social needs) will no longer have the support from this funding to build the necessary infrastructure to make these changes.
