The California Legislature and Governor Gavin Newsom have reached an agreement on a balanced budget for fiscal year 2020-2021 that protects vital health care programs.

The California Medical Association (CMA) is grateful that the budget preserves essential health care safety net programs at a time when Medi-Cal caseload is expected to grow by more than 2 million cases in the coming year. The budget also protects investments in California's health care workforce, which will help ensure all Californians, regardless of economic status, will have access to care when they need it.  

California began 2020 with a strong economy, historic reserves, a structurally balanced budget and a projected surplus of $5.6 billion. However, California is facing a $54.3 billion budget deficit due precipitous state revenue declines and caseload increases due to the COVID-19 pandemic.

Gov. Newsom had proposed sweeping the health care funding made possible by the Proposition 56 tobacco tax, and instead using it to address the looming budget deficit. The state Legislature rejected that plan, and fully restored the tobacco tax funds, including the funding for existing supplemental Medi-Cal payments and the CalHealthCares loan repayment program.

"This budget helps ensure that Californians, regardless of income, can have access to the health care they need during these unprecedented times. This budget also maintains important investments to ensure California has the health care professionals our state needs now, and in the future," said CMA President Peter N. Bretan, Jr. M.D. "This plan is compassionate, rational and balanced. It protects adult dental coverage and diabetes prevention program services for low-income patients and maintains the expansion of postpartum mental health services for women diagnosed with a maternal mental health condition."

The California Senate and Assembly will now pass the “budget junior bill” and trailer bills that will include additional details negotiated with the governor’s office. The governor will then sign the entire package.