Cuts would cost California an estimated $460 million in economic activity

CALIFORNIA—Hundreds of caregivers and healthcare consumers rallied in Sacramento, San Francisco, and Fresno today, calling on Gov. Schwarzenegger to fund vital healthcare services instead of running out the clock on the most vulnerable Californians. The protest was organized by homecare workers united in the National Union of Healthcare Workers.

“How can our governor and lawmakers sit and watch the clock run out when life-saving federal funds are on the way?” said Lola Young, a Sacramento homecare worker. “Homecare services save the state money, give an economic boost to struggling communities, and give our elderly and disabled ones the ability to live at home with dignity. In today’s economy, these cuts would be a disaster.”

Under the Governor’s budget deal, the state Treasurer and Director of Finance have until April 1 to determine whether new federal funds will be available by June 30, 2010 that could offset $10 billion in expenditures from the state’s General Fund. If that fiscal target isn’t met, the budget deal will trigger cuts of almost $1 billion from Medi-Cal, SSI, and homecare services for those most in need.

The cuts would cost California an estimated $219 million in wages paid to local residents, and a total of $460 million in economic activity.

So far, the Director of Finance has indicated that he is unlikely to find enough new federal funds in the Recovery Act and elsewhere before the clock runs out on April 1. But the Treasurer and Director of Finance won’t know the full extent of the new federal funding in the Recovery Act until after the April 1 deadline.

“These reckless cuts could force people with disabilities out of our own homes and into nursing homes, which would cost the state more money,” said John Wilkins, a disability advocate in Fresno. “And for those of us whose needs can’t be met in nursing homes, it would put our health and our lives at risk. Time is running out, and we need the Governor to stop the clock.”

The federal Recovery Act will send between $30 billion and $50 billion to California—more than enough to support vital services—and with those funds the state could meet the fiscal target and avoid the cuts. The California Budget Project, the Western Center on Law and Poverty, and other established budget watchdogs have identified as much as $12.3 billion in federal stimulus money available to applicable towards the $10 billion threshold.

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The National Union of Healthcare Workers is an independent, member-led union, dedicated to improving the lives of healthcare workers and the people they care for. NUHW is building a national movement of caregivers to hold healthcare corporations accountable to the public interest and win affordable, quality healthcare for all.