Report Says California Governor's Spending Plans On Proposition 56 'May Be Problematic'

Governor Jerry Brown’s plans for how to spend money from last fall’s tobacco tax increase “may be problematic” because they don’t go far enough to bolster Medi-Cal spending. That’s according to a new report by California’s Legislative Analyst’s Office which examined Brown’s plans for Proposition 56 revenue.

Carolyn Chu is with the LAO.

“Arguably, voters approved Proposition 56 to increase funding for Medi-Cal," says Chu. "The governor’s proposal may not be increasing spending in the program in the way that some might believe was intended by the voters.” 

California’s top medical and dental associations said early this year that Brown’s plans to spend Proposition 56 funds did not include raising rates for doctors who serve Medi-Cal patients.

A spokesman for the governor’s Department of Finance said the Legislature can use the new tax money to increase provider rates. But, to do that, they would need to find more than $1 billion from other General Fund programs.

Final decisions on how to use the Proposition 56 funds will be subject to negotiations this spring between the Legislature and the governor.