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Kai Ryssdal: Even though the recession is waning, states are still trying to come to grips with enormous budget deficits. They’ve cut hundreds of programs to fill their budget gaps. Some of the biggest cuts have come from health care. Lawsuits have forced states to keep the money in place. But California Governor Arnold Schwarzenegger’s just about had it. So tomorrow, he’s going to try something new: Get rid of the programs entirely.
Jeff Horwich reports.
Jeff Horwich: Home health care for the elderly, insurance subsidies for poor pregnant women. Even states in serious budget trouble don’t usually consider killing benefits like these — especially when they come with big federal money attached. Much better to trim a little all around, spread the pain.
Schwarzenegger spokesman Aaron McLear says California tried that.
Aaron McLear: Federal judges have kind of tied our hands in our ability to have flexibility to make some cuts. They’ve basically said that we can’t cut back on certain programs, but we can eliminate them.
So tomorrow, the governor will announce which health care programs are simply going to disappear.
McLear: Without raising taxes you have to cut programs. It’s simple math.
Actually, a little simple math might get California and other states out of this particular mess. Edwin Park is a senior fellow at the Center on Budget and Policy Priorities. He says courts have mostly rejected the cuts on technicalities.
Edwin Park: The courts have found the state in a number of these rate reductions failed to do the necessary analysis, and those kinds of studies weren’t done.
Even if California lawmakers go along, Park can’t believe Schwarzenegger will forfeit the huge streams of Medicaid dollars or jeopardize the benefits of federal health care reform. Not to mention…
Park: So many millions of families, seniors and people with disabilities rely on the program in some form or another.
Today, Schwarzenegger also announced his Plan B: An appeal to the U.S. Supreme Court, joined by 22 other states, to restore the original, more gentle, cuts.
I’m Jeff Horwich for Marketplace.
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