SACRAMENTO — With the state government considering deep cuts in health programs to address its budget shortfall, Gov. Gray Davis has asked the Bush administration to allow California counties to tap tens of millions of available federal dollars to cover uninsured children.
Federal approval of what the Davis administration is calling a "first-in-the-nation" proposal would allow California to expand medical coverage to about 50,000 children whose families don't have private health insurance and aren't covered by government programs for the poor.
"We need to be creative about ways in drawing down federal funds at a time when there aren't a lot of state funds," said Daniel Zingale, the governor's cabinet secretary. "This is part of the overall conversation of how do we address the fact that there are over 6 million Californians without health coverage."
Davis aides said they hoped that California counties would be allowed to use local -- rather than state -- money as a required match for available federal money under the State Children's Health Insurance Program. If approved by the federal government, which has not authorized other states to pursue money in that way, it would give California counties a chance to tap into matching funds that the state can't access in such tight budget times.
But the federal Center for Medicare and Medicaid Services was noncommittal. The California proposal is "under review," said a spokesman, who didn't want to be identified.
In recent months, the Bush administration has rebuffed broader appeals for financial assistance from struggling states. It is unclear whether the Republican administration is prepared to make such a fundamental change in how Washington administers medical and other programs at the state level as the California proposal envisions.
Given that there is little incentive for the Republican White House to aid a Democratic governor, some questioned the practical results of the Davis initiative. They cast it as an attempt by Davis to affirm his commitment to a popular issue without having to commit new money in a critical budget year.
"It sounds like a no-lose proposition for Davis," said Republican political consultant Dan Schnur. "If the federal government says yes, a lot more California children get covered and it doesn't cost Davis a dime. And if the feds say no, then he goes back to scapegoating the Bush administration for all of California's problems."
'Silver Lining'
Some health-care advocates, however, praised Davis' proposal as an innovative way to reduce the number of uninsured children at a time when legislators are considering budget proposals from the governor that could eliminate medical coverage for more than 500,000 low-income Californians.
"It's a silver lining in a very gloomy health-care sky in the budget," said Anthony Wright, executive director of Health Access, an advocate of expanding health coverage to uninsured Californians. "It obviously pales in comparison to the impact of the budget, but these efforts do help deal with the problem of lack of access to health care."
The California proposal is an outgrowth of legislation signed by Davis two year ago, Assembly Bill 495, by Assemblyman Manny Diaz (D-San Jose). The bill authorized the state board that oversees the Health Families program for working poor families to help counties and local agencies obtain federal money for children's medical programs.
State officials and Davis aides have worked with local, county and federal officials to find ways to tap into the available federal money.
Under the federal State Children's Health Insurance Program (SCHIP), a state can receive $2 in federal funds for every $1 it spends on programs that provide health care to the children of working poor families. But, facing severe budget constraints, California wasn't able to claim $700 million in available funds last year because it could not meet the matching funds requirement, and the state is expected to forgo $98 million this year, administration officials said.
The Medi-Cal program -- the California version of Medicaid -- provides medical coverage to families with incomes up to 133% of the federal poverty level. The Healthy Families program provides medical coverage for children whose family income exceeds Medi-Cal levels and extends up to 250% of the federal poverty level, which would be $46,000 in annual income for a family of four.
Davis administration officials would like to expand the Healthy Families program to 300% of the federal poverty level, or $51,000 of annual income for a family of four, but the state can't afford it. With the state facing a budget shortfall of as much as $35 billion over the next 15 months, some local governments are addressing the problem on their own. The Davis appeal for a waiver of existing federal requirements is aimed at helping these and other counties.
