City Council Meeting: January 27, 2004 Santa Monica, California

TO: Mayor and City Council

FROM: Disabilities Commission

SUBJECT: Request From the Disabilities Commission for City Council to Approve Commission Advocacy Efforts to Support Funding for Health and Human Services Impacting People With Disabilities.

Introduction

This report requests Council approval of Disabilities Commission advocacy efforts to support the necessary State funding to preserve health and human services impacting people with disabilities at the State and local levels. With City Council approval, the Disabilities Commission will communicate with local, regional and State officials in support of this position.

Background

On November 24, Governor Schwarzenegger’s staff, in response to the current and anticipated budget deficits, proposed cutting certain health and human services programs, in addition to issuing a $15 billion bond to close a State budget shortfall estimated at $24.8 billion over the next 18 months. The bond measure has been placed on the March, 2004 ballot. Proposed cuts to health and human services continue to be discussed by the Legislature and the Governor, whose budget proposal has been released.

According to the California Budget Project and the California Health Care Foundation, the Governor’s proposed cuts include $720 million from the Department of Health Services and $632 million from the Department of Social Services, Child Support and other human services programs. These are in addition to cuts to the Transportation Department ($933 million) and higher education ($319 million).

Specific proposed reductions include:

· Capping enrollment in a range of health and social service programs at January 1, 2004 levels. Covered programs would include Healthy Families, the California Food Assistance Program, and the Cash Assistance Program for Immigrants, the AIDS Drug Assistance Program, Department of Rehabilitation programs, the Genetically Handicapped Persons Program, and the California Children’s Services State-only program. Legal immigrant enrollment in Medi-Cal, Healthy Families, and CalWORKs would also be capped at January 1, 2004 levels;

· An additional 10 percent reduction in Medi-Cal provider reimbursement rates ($151.8 million in 2003-04 and $443.0 million in 2004-05). The 2003-04 budget agreement reduced provider reimbursement rates by 5 percent;

· A 5 percent cut in CalWORKs cash assistance payments and elimination of the statutory CalWORKs COLA that became effective October 1, 2003, as a result of the reduction in the Vehicle License Fee (VLF) rate;

· Use of federal Temporary Assistance for Needy Families (TANF) dollars to pay for In-Home Supportive Services, Foster Care, Child Welfare Services, and Developmental Services ($41.1 million in 2003-04 and $119.5 million in 2004-05);

· Elimination of the Wage Adjustment Rate Program, which provides supplemental payments to certain long-term care facilities for salaries, wages or benefits for caregivers ($46 million in 2003-04 and $2.5 million in 2004-05);

· Eliminating the “residual” In-Home Supportive Services program, which provides certain services such as heavy cleaning, transportation, non-medical personal care and respite services ($63.2 million in 2003-04 and $322.2 million in 2004-05); and

· Eliminating the Transitional Food Stamp program and rescinding changes made to food stamp vehicle and application rules enacted by AB 231 of 2003 ($1.5 million in 2003-04 and $4.3 million in 2004-05).

Additionally, because the Governor issued an Executive Order directing approximately $2.65 billion in State funds to local governments to repay them for revenue lost as a result of the repeal of the vehicle license fee increase, there is concern that increased state funds for local governments could result in reduced funds for health and human services. Local agencies serving seniors and people with disabilities in Santa Monica will likely feel any cuts immediately because most receive funding from various County, Regional and State departments that would be affected (e.g. Department of Health, Department of Rehabilitation, Department of Mental Health, Area Agency on Aging, et cetera). The 2000 census shows that there are 13,202 persons with a disability aged 5 years or older living in Santa Monica (17% of the total population).

Discussion

Collectively, the cuts to health and human services account for almost 50% of the total proposed budget cuts, a disproportionate share of the deficit burden which will be shouldered by the most vulnerable sectors of the population. These cuts would result in the loss of services to low-income residents, seniors and people with disabilities, both children and adults:

• The proposed cut in the In-Home Support Services (IHSS) program would result in 74,200 elderly, blind, and disabled persons losing homecare services.

• Services provided by IHSS and Medi-Cal providers allow people with disabilities to live independently in the community, rather than in more restrictive environments including nursing homes and state hospitals. These more restrictive environments are also more expensive.

• Further cuts to Medi-Cal providers will likely result in fewer providers, leading to further overcrowding in emergency rooms, which is more expensive than primary care in an appropriate setting.

Recommendation

The Disabilities Commission requests the City Council’s approval to undertake advocacy efforts directed to county, regional and state officials to provide funding to continue health and human services impacting people with disabilities.

PREPARED BY: Disabilities Commission

Janet Hand, Commission Staff Liaison