The likely outcome of Prop. 35? California will have to cut care for Medi-Cal patients | Opinion

The most expensive measure before voters this November is a health care industry-funded proposal claiming to strengthen Medi-Cal, California’s largest public health care program that serves the state’s poorest residents. But as with many things in health care, Proposition 35 is more complicated than it appears.

A closer look reveals that this measure threatens care for the very Californians it claims to help. Advocates for health care consumers, children’s health, communities of color, seniors and democracy all urge a “No” vote on this complicated and dangerous measure.

Medi-Cal provides health insurance to over 14 million Californians, including half of all children. The program guarantees access to primary and preventive care, mental health care and specialty services for the state’s most vulnerable residents. Yet, for years, it has been plagued by challenges stemming from unequal investment and scant accountability.

No one understands this better than the children, families and individuals who have struggled to access the care they need.

Proponents argue Prop. 35 is necessary to ensure that health care tax dollars are invested in Medi-Cal, not used to plug state budget holes. But here’s why the details matter: For nearly two decades, California lawmakers have enacted a Managed Care Organization tax (a tax on health insurance plans like Kaiser). The tax allows California to leverage state funds to draw down federal matching dollars to support Medi-Cal.

The current Managed Care Organization tax, if approved by the federal government, will bring in $7 billion to $8 billion annually through the end of 2026, at which point lawmakers will need to renew the tax.

Under Prop. 35, the state will still have to seek federal approval for the tax, but lawmakers will no longer be allowed to decide how the tax is structured, and — more critically — how the funds are spent. The initiative does not simply require spending on Medi-Cal. If it did, our organizations would support it. Rather, it dictates a complex spending plan that chooses new winners and losers in health care, rather than prioritizing the needs of patients.

The state’s non-partisan legislative analyst and Department of Finance agree: Prop. 35 would create a multi-billion-dollar budget hole for the next three years, making it the most expensive measure on the ballot. But Prop. 35 goes even further by locking in permanent spending for a select group of Medi-Cal providers even as it jeopardizes billions of dollars in federal funding.

Furthermore, by limiting the amount paid by for-profit health insurers — some of whom are even funding the initiative — the measure runs afoul of federal directives, risking federal approval in the future.

The likely outcome? California will have to cut care for Medi-Cal patients or slash other safety net programs that millions rely on.

Decisions over billions of health care dollars should be made through a transparent process, informed by the interests of the people who depend on Medi-Cal for health care. We need to reimagine a system that lives up to the promise of a California for all. Voters should support real solutions. That starts by rejecting Prop. 35.

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