Call Goes Out to California Legislators to Support Taxes to Prevent Health Cuts

ACTION #2: Forward this within your organization, memberships and at least five friends in California. We need as many Californians as possible to register their opposition to these severe budget cuts.

BACKGROUND: The budget is already late, and we need our legislators to take action NOW in order to protect our state's future! Votes will be taken in the next few weeks.

The compromise budget proposed by the Conference Committee did reject--for now--many draconian cuts in health care, that would have resulted in over one million more Californians not getting health coverage as a result of the budget, and three and a half million Californians having to pay more and/or get less in terms of care and coverage.

Because no cut or restoration is final until a budget is approved, all cuts are still on the table until both parties in the Legislature can agree on taxes. The Conference Committee budget relies on over $9 billion in raised revenues in order to prevent other cuts.

REAL CUTS, ESPECIALLY TO CHILDREN'S COVERAGE: Yet even under this Democrat-supported budget, health care, and in particular children's coverage, gets hit hard. Even with the additional revenues raised, more than a quarter-million children are expected to lose coverage if this version of the budget is fully implemented. The cuts approved that would impact children's health coverage include:

• Imposing additional paperwork burdens so a quarter of a million children fall off coverage under full implementation by 2011.

• Increasing premiums in the Healthy Families program.

• Suspending streamlining and enrollment reforms.

Additional revenues would be needed to prevent these cuts.

REVENUES PROPOSED AT THIS POINT:

The compromise budget proposal from the Conference Committee includes the following sources of revenue that will prevent the harshest of the proposed cuts to vital services. The proposal will:

• Restore corporate tax rates to the pre-1997 level ($470 million). The proposal also suspends for three years the option for corporations to carry forward net operating losses and use as a deduction in future years ($1.1 billion).

• Restore upper-income tax brackets to similar levels set by Governor Wilson, impacting households earning above $321,000 ($5.6 billion). A dependent credit for households over $150,000 would also be rolled back ($215 million) and an adjustment to tax tables will be suspended, meaning families over $97,000 would pay about $180 more yearly ($815 million).

• Step up tax enforcement through an amnesty program for money owed to the state, based on a previously successful program ($1.5 billion).

These revenues and other such options have been opposed by some legislators, who favor either much steeper cuts to health care and other vital services, or borrowing that would force cuts in future years. That's why legislators need to hear about support against these cuts and for the revenues that would replace them.

Health Access California is a statewide health care consumer advocacy coalition of over 200 groups. This article has also been published on the Health Access Weblog.