Health proposals in Governor Newson’s 2021-22 budget

Governor Gavin Newsom announced his 2021-2022 budget proposal on Friday, which includes funding for immediate COVID-19 relief and response. The $227.2 billion fiscal blueprint prioritizes economic relief for small businesses, vaccine distribution, homelessness relief and protections and the reignition of Cal-AIM.  


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According to the budget proposal, California’s revenue only slowed moderately, compared to other states, due to the progressive tax structure of the state. The state also expects capital gains to continue to accrue due to the rebounding stock market.

“In these darkest moments of the COVID-19 pandemic, this budget will help Californians with urgent action to address our immediate challenges and build towards our recovery,” Newson said. “As always, our budget is built on our core California values of inclusion, economic growth and a brighter future for all. The budget makes progress towards the goal I set when taking office to harness California’s spirit of innovation and resilience and put the California Dream within reach of more Californians. I look forward to working with the Legislature to enact these critical immediate and longer-term priorities for our state for the 40 million who call the Golden State home.”

Here are the budgets’ key health-related proposals that lawmakers will evaluate when the 2021 session begins:

The COVID-19 Pandemic Response:

Newsom is proposing $4.4 billion for the COVID-19 emergency response, and expects most of that money to be reimbursed once anticipated federal money is received by the state. Notable estimated investments are:

  • Just over $82 million being given to state hospitals to cope with testing, surge capacity and other operational costs.
  • Just over $472 million in funds for contact tracing efforts.
  • $1.2 billion in funding for support services for vulnerable populations, like Project Roomkey, food banks and small businesses.
  • Just over $2 billion in statewide testing efforts.
  • Over $370 million for the Vaccine Distribution Task Force.

Health and Human Services:

The proposed budget for the California Health and Human Services Agency is $195.1 billion, this is for the support of all health and human services programs and does not include pandemic response efforts. Notable estimated investments in programs are:

  • $122.2 billion in funding for the Medi-Cal program
  • $1.1 billion going towards the reignition of the CalAIM program
  • $16.6 billion in funding for in-home supportive services
  • $5.3 billion for CalWORKS
  • $4.2 billion in funding for public health
  • $2.6 billion in funding for state hospitals

“We are heartened to see that in these difficult economic times, the proposed budget continues to prioritize those individuals who have been marginalized and underserved,” said Brianna Lierman, CEO of Local Health Plans of California. “As we face uncertain economic times and serious health risks, it is essential to remain focused on addressing health disparities, especially in communities of color, and adequately funding new Medi-Cal initiatives to ensure some of the lowest income Californians get the health care they need.”

Housing and Homeless:

The budget puts an emphasis on combating the continued epidemic of homelessness in California, as well as programs and funding for people in danger of losing their homes due to the COVID-19 pandemic. The budget allocates $10.32 billion in funding for different programs to support these goals. Notable estimated investments include:

  • The budget allocates just over $2.6 billion to the Department of Housing and Community Development for services like the No Place Like Home program, Veterans Housing and Homelessness Prevention and continued acquisitions for the HomeKey program.
  • $414 million for the Department of Social Services for CalWORKs and expanded facilities to support housing.
  • $55 million for the Office of Emergency Services for the Domestic Violence Housing First Program, transitional housing programs and various homeless youth programs.

The governor’s budget also includes increased funding for schools, economic recovery and advancing direct cash payments to Californians through the Golden State Stimulus program. The legislature will consider this proposal in the 2021 session.