Major Loss of Health Funding for O.C. Feared

A staggering $19.1 million in state funding for health care programs would be stripped from Orange County under Gov. George Deukmejian’s proposed budget for the coming year, according to a report sent Wednesday to the Board of Supervisors.

The county would be forced to rely on “transitory and less predictable” sources of revenue in place of state funding now received for indigent medical care, general public health and a host of other services including care for emotionally disturbed children, according to the report from County Administrative Officer Ernie Schneider.

Future tax revenue could well offset the cuts, Schneider said, but those funds cannot be relied upon.

“The budget proposes that a major reduction of 31.9% in the local government relief fund and a continued cut in medically indigent services be offset by (revenue sources) the county does not have a sufficient track record with,” Schneider wrote to the supervisors.

The report says Deukmejian’s budget proposal for the fiscal year beginning July 1 would eliminate $8.5 million in current state funding for Orange County’s general public health programs and $8.35 million in funding for health care for the poor. The budget also eliminates $1.5 million in inflation adjustments that had been projected for the county’s health programs next year, according to the report.

The governor’s proposal suggests that the county would make up the money through funding that will become available from the Proposition 99 tobacco tax and proposed increases in state reimbursements for services the county provides.

Because those reimbursements depend on the number of Medi-Cal and other assistance claims filed by county residents in any given year, county officials cannot predict with any certainty how much money will be available, Schneider’s report says.

Further clouding the county’s economic forecast, the report continues, is the uncertainty of Proposition 111 on the June ballot. The gas tax initiative, if approved, is also expected to offset some of the shortfalls, according to the governor’s proposed budget.

“I would say that it only adds insult to injury,” Supervisor Harriett M. Wieder said in angry reaction to the budget news, which is scheduled to be formally presented to the board Tuesday. “Orange County doesn’t get fair equity from the state now. . . . It sounds like a challenge to the voters that if you want everything from health care to roads, you better vote for 111.”

Orange County’s own proposed budget for next year is already threatened by a deficit of as much as $25 million; officials project expenditures of $436 million against revenue of only $410.7 million. A similar deficit projected last year, however, was erased by departmental belt-tightening and unanticipated revenue.

Schneider’s analysis of the governor’s $53.1-billon budget--containing a $1-billion statewide reduction in aid to poor families, counties, the elderly and disabled--was not sent to the board offices until late Wednesday, and some supervisors have not yet seen it. Dan Wooldridge, an aide to Supervisor Don R. Roth, said, however, that county budget experts had already warned officials that the county would face substantial cuts in state funding under the proposal.

Wooldridge described county officials as deeply concerned but hopeful that some of the funding would be restored by the Legislature or replaced by other sources in time to avert massive county cutbacks.

“We’re taking this seriously,” Wooldridge said, “but while the governor can propose cuts, the Legislature can put some things back.”

Schneider’s analysis concludes that the governor’s budget will eliminate funding for several programs of “particular importance” to county health officials. Among the services for which the state will no longer provide money are transportation and psychological services for mentally ill patients, as well as heroin detoxification programs. The report does not say how much it would cost the county to pick up the tab for those programs.

The governor’s budget also eliminates $802,000 for severely emotionally disturbed children that currently goes to the county health department. Services for these children might be provided through the state Department of Education, although that remains unclear, the report says.

County officials predicted that the governor’s proposed cuts would face significant opposition from local governments throughout the state.

“There will no doubt be reaction throughout the counties and the Legislature,” Schneider predicted in his report, “in which Orange County will want to participate.”

Times staff writer George Frank contributed to this report.