No on Prop. 35, a bad approach to public policy

Proposition 35 is probably the most complicated and obscure measure on the ballot this year, running nearly 15, 000 words. It asks voters to sort out arcane health care financing issues better left to experts and elected officials who can delve into the interplay of taxes on managed-care organizations, federal funding, reimbursement rates for medical providers and the state budget. We recommend Californians vote no.

Prop. 35 has a noble goal: to provide more money to hospitals, clinics and doctors so that they will treat more Medi-Cal patients. The money would come from making a tax on health care plans permanent. Right now, the tax could expire in a couple of years.

Medi-Cal is the state's version of the federal Medicaid program. It provides health care coverage for low-income individuals and people with disabilities. About 15 million Californians use Medi-Cal, including income-eligible immigrants, regardless of legal standing. The state pays for parts of the program that federal Medicaid funding does not cover.

Many communities with large proportions of Medi-Cal patients struggle to attract health care providers because Medi-Cal's reimbursement rates aren't as high as rates paid by private insurers. If doctors can earn more elsewhere or by declining to take Medi-Cal patients, it's hard to begrudge them that choice. Hospitals and clinics that serve Medi-Cal patients also have a tough time making ends meet.

The result is Medi-Cal patients in rural and low-income urban areas face long wait times or long drives to receive health care.

Under Prop. 35, a tax on managed-care health plans would help provide primary and specialty care, emergency services, family planning, mental health and prescription drugs under Medi-Cal. That could bolster doctors' willingness to take on patients and improve access in rural and low-income urban areas.

Pedro Toledo, CEO of Petaluma Health Center, says local clinics would get $5 million annually.

It's a worthwhile goal targeting a real problem, but there's a catch. Prop. 35 doesn't just extend the tax. It mandates how the money must be spent forever. It is a classic example of budgeting at the ballot box, something that rarely goes well.

Prop. 35 would tie the hands of the Legislature and the governor when it comes to managing the state's finances. As circumstances change, state budget writers need flexibility to adapt. Right now, lawmakers use some of the tax revenue that Prop. 35 addresses to offset the burden on the state general fund. They could no longer do that if the measure passes. The state's nonpartisan legislative analyst estimates that would wind up costing the state $1 billion-$2 billion over the next three years, and more in the years beyond.

It's telling who is backing Prop. 35. Doctors, hospitals and medical groups are among its biggest supporters. When the people behind a proposition are the ones who stand to benefit financially, it should raise red flags with voters. Meanwhile, good-government groups like the League of Women Voters of California and the California Alliance of Retired Americans are opposed. California needs to improve its Medi-Cal reimbursements, but that's a job for lawmakers and the governor, not something to be determined by a complicated ballot initiative.