January 14, 2019 - This report presents our office’s initial assessment of the Governor’s Budget. The budget’s position continues to be positive. With $20.6 billion in discretionary resources available, the Governor’s budget proposal reflects a budget situation that is even better than the one our office estimated in the November Fiscal Outlook. The Governor’s Budget allocates nearly half of these discretionary resources to repaying state liabilities. Then, the Governor allocates $5.1 billion to one-time programmatic spending, $3 billion to reserves, and $2.7 billion to ongoing spending. Although the Governor’s allocation to discretionary reserves represents a smaller share of resources than recent budgets, the Governor’s decision to use a significant share of resources to pay down state debts is prudent. The Governor’s ongoing spending proposal is roughly in line with our November estimate of the ongoing capacity of the budget under an economic growth scenario. This was just one scenario, however. Recent financial market volatility indicates revenues could be somewhat lower than either we or the administration estimated.
October 15, 2020 - From the General Fund, the 2020-21 spending plan provides $26.7 billion for health programs—an increase of 3 percent over estimated 2019-20 General Fund spending for these programs. The year-over-year net increase in General Fund spending is largely due to the projected COVID-19-related increase in the Medi-Cal caseload. The post describes major health-related actions (both policy actions and various budget adjustments) adopted by the Legislature as part of its 2020-21 spending plan. These actions include the offsetting of what would otherwise be General Fund costs with (1) revenues from the federally approved reauthorized tax on managed care organizations and (2) federal Medicaid funds that are being provided to the state at an enhanced level during the term of the public health emergency.
February 23, 2022 - This brief focuses on access to health insurance coverage and the affordability of health care costs. We (1) assess various Governor’s proposals intended to improve health care access and/or affordability—including expanding Medi-Cal eligibility to undocumented residents between ages 26, reducing Medi-Cal premiums to zero cost, establishing the Office of Health Care Affordability, and reducing the cost of insulin through a state partnership; (2) discuss options to improve affordability of health plans purchased through Covered California; and (3) highlight some key access and affordability challenges that remain to address.
Correction (2/24/22): Figure 2 - Number of undocumented residents has been corrected.
February 19, 2013 - Under the Patient Protection and Affordable Care Act, also known as federal health care reform, the state has the option to expand its Medicaid program (known as Medi-Cal) to cover over one million low-income adults who are currently ineligible. Currently counties have the fiscal and programmatic responsibility for the care of the low-income adult population that would be covered by the expansion. The Governor has proposed to adopt the optional expansion, but has outlined two distinct approaches to implementing the expansion—a state-based approach and a county-based approach—and has not indicated a preference for either approach. Under both approaches, the Governor indicates that the expansion will require a reassessment of the state-local fiscal relationship. We find that the expansion would have significant policy benefits, including improved health outcomes for the newly eligible Medi-Cal population. We estimate that fiscal savings to the state as a whole are likely to outweigh the cost of the expansion for at least a decade, although these estimates are subject to significant uncertainty. Despite the significant uncertainty about long-term costs and savings, on balance, we believe the policy merits of the expansion and fiscal benefits to the state as a whole likely will outweigh the costs and potential fiscal risks. We therefore recommend the state adopt the expansion. We also find that the state is in a better position to effectively deliver health services to the newly eligible population. Therefore, we recommend the Legislature adopt a state-based expansion, shifting the fiscal and programmatic responsibility of providing physical health care to the expansion population from counties to the state. Given this shift of responsibility, we further recommend the Legislature redirect a portion of funding currently allocated to counties under 1991 realignment for indigent health care.
February 7, 2019 - This report provides our assessment of the Governor's proposals to (1) create a state requirement that most Californians purchase health insurance coverage (referred to as an "individual mandate") or pay a financial penalty and (2) use the revenues from this penalty to fund additional health insurance subsidies for households purchasing coverage through Covered California.
December 16, 2022 - This brief looks at health care coverage in California; provides background on the drivers of the significant decline in the percentage of Californians without health care coverage over the last ten years; and discusses various issues that could impact the number of Californians with coverage, and how the type of coverage they have may change, in calendar year 2023 and beyond.
October 21, 2020 - Senate Health Committee
Updated 11/13/2020.
May 13, 2010 - The Patient Protection and Affordable Care Act (PPACA), often referred to as federal health care reform, is far-reaching legislation that will change how millions of Californians access health care coverage. We provide an overview of the new law and describe its implications for state health programs in the near term and the long term. We also recommend the Legislature think broadly about implementing PPACA and identify key issues to address including: (1) future costs for health programs, (2) whether structural changes to health programs are warranted, (3) whether PPACA should prompt a reevaluation of the state-local relationship, (4) new strategies that could bolster health care quality and outcomes, and (5) how future workforce and health infrastructure needs should be addressed.
February 20, 2014 - The report analyzes the Governor's 2014-15 health budget proposals. In it, we (1) provide an analysis of the impact the implementation of the Patient Protection and Affordable Care Act (ACA)--known as federal health care reform--is having on the Medi-Cal program; (2) analyze the Governor's budget proposal to exempt certain, but not all, classes of Medi-Cal providers and services from retroactive recoupments of payment reductions; and (3) assess the fiscal outlook for the California Health Benefit Exchange, also known as Covered California.
February 24, 2020 - This brief provides information, analysis, and key issues to consider in evaluating the Governor’s 2020-21 budget proposals for the major programs in Department of Social Services.
June 2, 1999 - Roughly two million low-income children and their parents, primarily in working families, do not have health coverage in California. We have developed a “Family Coverage Model” which would result in an additional 0.9 million to 1.4 million persons obtaining health coverage at an annual cost of $188 million to $385 million annually when fully implemented.
November 4, 2013 - The LAO’s annual California Spending Plan publication details the 2013-14 budget package, including legislative and gubernatorial actions through October 2013. (Our office released a preliminary electronic version of the report on July 30, 2013 that summarized legislative and gubernatorial actions through that date.) Major features of the 2013-14 budget plan include $2.1 billion for a new formula to distribute funding amongst schools, a state-based plan to expand Medi-Cal to cover more than one million additional low-income adults, and selected program augmentations.
February 12, 2015 - This report analyzes the Governor's 2015-16 state health program budget proposals. In the report, we review trends in the major health programs since 2007-08 (the last budget developed before the most recent recession), analyze the Governor's proposed restructuring of the managed care organization (MCO) tax, and describe the uncertainty regarding continued federal funding for the Children's Health Insurance Program (CHIP). The report also includes an analysis of the Department of State Hospitals budget and an analysis of the Governor's proposals to improve quality and increase staffing for the Licensing and Certification (L&C) Program administered by the Department of Public Health.
February 17, 2017 - Summarizes the major impacts that the ACA has had in California, explores what the ACA’s repeal could mean for the state, and assesses a collection of policy alternatives to the ACA that the new federal administration and Congress are currently considering.
Correction 3/6/17: Removed reference to Alpine County as having only one participating insurer.
March 9, 2017 - In California, the federal‑state Medicaid program is administered by the Department of Health Care Services (DHCS) as the California Medical Assistance Program (Medi‑Cal). Medi‑Cal is by far the largest state‑administered health services program in terms of annual caseload and expenditures. In this report, we provide an analysis of the administration’s caseload projections, including a discussion of the projected increases in ACA optional expansion caseload. We also provide an assessment of several aforementioned major factors affecting projected changes in Medi‑Cal spending in 2017‑18 and other policy changes proposed by the administration. These include the Governor’s proposed uses of Proposition 56 revenues, the proposal to shift additional New Qualified Immigrants (NQIs) to Covered California in 2017‑18, assumptions around federal CHIP funding, and the proposed abolition and transfer of the Major Risk Medical Insurance Fund (MRMIF).
October 18, 2017 - Each year, our office publishes the California Spending Plan to summarize the annual state budget. This publication discusses the 2017‑18 Budget Act and other major budget actions approved in 2017. In general, it reflects budgetary actions that the Legislature has taken through September 2017. In some cases, as noted, we discuss budget actions approved by the Legislature after June 15, 2017. In late July, for example, the Legislature passed and the Governor approved, an extension of authority for the Air Resources Board to implement the state’s cap‑and‑trade program from 2020 to 2030.