A Cautiously Optimistic Prognosis

The risk of losing half a billion federal dollars has given a kick to the task of getting thousands of uninsured working families some regular medical care. Gov. Gray Davis, at the urging of many state lawmakers, has agreed to apply for a federal waiver that would greatly expand the state’s health insurance programs for the working poor. The move aims at preventing the state from losing $590 million in federal matching money.

In 1997, the Clinton administration allotted California $855 million to provide medical coverage to children from working poor families through a program called Healthy Families. The state, however, has spent only $265 million of that first-year allocation, and unless Davis applies for the waiver, it will lose the remaining $590 million by the end of this month. In addition to buying time, the waiver, if granted, would allow California to spend its Healthy Families dollars in novel ways--on expanding the reach of Medi-Cal, for instance.

Davis, whose effort to keep the federal funds is commendable, now has to put more effort in how to wisely spend it. He has been cautious about health-related spending bills pushed last week in the Legislature. For instance, Davis staffers balked at supporting a measure by Sen. Martha Escutia (D-Whittier) that would have required California to use tobacco settlement dollars for expanding Healthy Families to parents. Tying the state to a long-term spending commitment now may be premature, some staffers argued, because estimates of how much it would cost to extend health insurance to working poor parents now range wildly, from $130 million (the bill’s sponsors) to more than $400 million (the Clinton administration).

Davis’ first task should be dismantling the barriers that prevent qualified low-income Californians from enrolling in existing public health insurance programs for the poor. He can do so by signing these two sensible bills now on his desk:

* AB 2900 by Assemblyman Martin Gallegos (D-Baldwin Park) eliminates current laws that boot children out of Medi-Cal unless their parents re-enroll in the program every three months.

* SB 87 by Sen. Escutia would change current laws that terminate children’s health insurance when families move from welfare to work. A study released in June by Families USA found that as California implemented welfare reform, it failed to ensure that parents moving from welfare to work retained needed health coverage, even though they and their children were entitled to it.

By signing these bills, Davis can meaningfully reach out to many of the 7.3 million Californians who go without health insurance. But the governor should embark upon more ambitious expansions more cautiously, bearing in mind that the state’s complex health access problems, years in the making, won’t be solved in a day.