California budget must consider growing older adult population

OPINION – Governor Newsom’s release of the May Budget Revise included a shortfall of $12 billion and proposed reductions that would have affected older adults and people with disabilities. We had deep concerns about these proposals, especially those related to health care and home and community-based services (HCBS). They would place older adults and people with disabilities at significant risk and jeopardize progress made to support affordable systems of care. With the legislature’s passage of their June 15 budget including modifications to proposed reductions, there is an opportunity for the Governor to uphold the state’s commitment to this demographic.

HCBS saves the state money, as they are more cost effective to provide than nursing home care. Reducing access to HCBS will lead to increased reliance on institutional care, driving up costs for the state. Fiscally, these proposed reductions in the Governor’s May Revise did not make sense.

California’s population is diversifying, with people of color comprising over 50% of the 65+ population by 2040. The  proposed budget reductions could increase racial and ethnic disparities in care for people of color, who already experience lower incomes, lower retirement savings, and lower rates of health coverage, also impacting family caregivers, forced to take on more caregiving in the absence of HCBS., Reductions could make it harder for those in rural communities, which already experience increased gaps in HCBS, to find providers.

California remains a leader in aging, including in the implementation of the Master Plan for Aging (MPA), a roadmap in both good and challenging budget times. Stakeholders continue to elevate the importance of addressing HCBS access. The IMPACT Committee, which guides the MPA, recently released its latest report, emphasizing the importance of creating a home care system for all.

The progress we have made on this front cannot be stalled—instead of reductions, we should be pursuing sustainable options to make HCBS more affordable (e.g. public long-term care insurance fund, caregiver tax credits). Governor Newsom called for an MPA to make California a state where we all can age well. The proposed cutbacks don’t reflect this commitment and will create more restrictive criteria for programs and services, including:

• Reinstatement of the Medi-Cal (Medicaid) asset test for older adults and people with disabilities ($2,000/individual and $3,000/couple) – the legislature has rejected the Governor’s proposal and instead created an asset limit of $130,000/individual and $195,000/couple
• A 50-hour cap on In-Home Supportive Services (IHSS) provider overtime and travel hours – the Legislature rejected this
• Elimination of the Long-Term Care (LTC) benefit for people identified as having “unsatisfactory immigration status (UIS)” – the legislature rejected this

These proposals would worsen barriers to care, especially for those who are low-income, from communities of color, and from rural communities. Reinstating the asset test will affect an estimated 112,000 people currently eligible for Medi-Cal, adding them to the number of Californians who cannot afford HCBS.

Julia in Oakland shared just how invaluable Medi-Cal access is and the importance of being able to save: “I have 16+ hours per day of services that I get through Medi-Cal…I literally would not be able to get out of bed without my IHSS, and now I’m being told that if I save a penny over $2,000, I will lose all of this…. Like everyone else, I need to be able to save in case I lose my job, my wheelchair-accessible van breaks down, or I have any number of disability-related expenses that aren’t covered by Medi-Cal.”

The cap on IHSS overtime and travel hours that was proposed will exacerbate the IHSS provider shortage, especially for those in rural communities where significant gaps in services already exist. The elimination of the LTC benefit for people with UIS not only removes access to HCBS, but also skilled nursing facility care.

Pending Medicaid cutbacks at the federal level will also have an impact, especially on access to HCBS. Reductions at the federal level will put pressures on the state budget, where optional benefits like HCBS could be at risk, worsening effects on older adults and people with disabilities.

California must remain focused on the progress made to support the needs of older adults and people with disabilities. Proposed reductions would undermine the commitment made to Californians through the MPA. We urge the Governor to accept the modifications made in the legislature’s budget to continue supporting investments in older adults and people with disabilities.

Sarita A. Mohanty is the president and CEO of The SCAN Foundation and a member of the state’s Implementing the MPA in California Together (IMPACT) Stakeholder Committee.

Kevin Prindiville is the Executive Director of Justice in Aging.