Over the last 15 years, California racked up three small surpluses, two break-evens and 10 huge deficits.
“There’s not a lot of money left in the budget,” said Gov. Jerry Brown regarding the $164.7 billion budget unveiled Friday. “It’s very tight.”
The real reason money is tight is Brown and the Democratic legislature increased spending by five percent in a period when inflation is averaging 1.3 percent. California’s proposed spending will jump $5.8 billion more than inflation.
Jerry Brown tried to sound financially responsible when he crowed that his budget projects a $1.2 billion surplus, but he avoided addressing out-of-control healthcare costs. Buried in Brown’s spending plan is the fact that the state’s Medi-Cal enrollment expansion is $2.5 million over projection, the least expensive Covered California health plan premium just jumped by 11.7 percent and the state’s un-funded retiree medical liability is $71.8 billion.
Unmentioned in the Governor’s spending proposals are the healthcare costs for another million illegal adult immigrants residing in California that are now eligible for Medi-Cal enrollment since President Obama’s expanded his executive order to include adults, as long as they qualify by income.
Since the Patient Protection and Affordable Care Act (Obamacare) took effect, Medi-Cal enrollment has expanded from 7.9 million people in 2012-13 to 12.2 million people this year. Two million people newly enrolled in Medi-Cal last year, but Brown’s budget proposal estimates only another 300,000 will sign up during the 2015-16 budget year. Brown’s supposed “balanced budget” has no provision for another million illegals.
Originally titled as Deferred Action for Childhood Arrivals (DACA) program, there were are 125,000 that would have gained coverage under Medi-Cal in 2013. But President Obama made 5 million more adult illegal aliens eligible for renewable two-year deferred deportation and work eligibility in November of 2014.
The federal government will fund the total cost for the first three years for any newly “eligible” Medi-Cal expanded population.
The Department of Homeland Security confirmed that DACA adult grantees are lawfully present in the United States — and now California is responsible to provide Medi-Cal coverage another one million adult illegals residing in California.
According to the non-partisan Legislative Analyst’s Office, the Governor’s Proposed Budget assumed average per member per month (PMPM) costs for the mandatory Medi-Cal expansion population was $139 for adults and $97 for children. Therefore, the cost to California for another one million Medi-Cal enrollees is $1.668 billion.
California may appear to have financially improved due to a stronger economy and Proposition 30 temporary tax increases. But proposing to spend $5.8 billion more than inflation and dramatically under estimating healthcare costs means California may soon be back in serious financial trouble.