Governor Releases 22-23 State Budget Proposal

Monday, Governor Gavin Newsom submitted his 2022-2023 state budget proposal. California now has a projected surplus of $45.7 billion, which includes $20.6 billion for discretionary purposes, after subtracting $16.1 billion in additional Proposition 98 for K-14 education, and $9 billion in reserve deposits and supplemental pension payments. CSAP’s state legislative advocates, SYASL Inc., have provided highlights from the CSAP perspective, which include – but are not limited to – the following:
Implementing a 988 Behavioral/Mental Health Crisis Hotline. $7.5 million ($6 million ongoing) and 10 positions to implement the new federally mandated 988 call system to increase the ease and accessibility for those experiencing a behavioral or mental health crisis. Those who dial 988 will be directed to 1 of the 13 existing Lifeline Call Centers across the state. These centers already provide immediate assistance with mental distress, and the additional funding will assist those needing services to receive help more efficiently. The budget includes funding for call handling equipment so existing crisis hotline centers have the resources needed to process additional 988 calls and coordinate and transfer calls with no loss of information between the 988 and 9111 systems. In 2022, the California Health and Human Services Agency will develop a plan to support connections between prevention efforts like warm-lines and peer support services, 988 mental health crisis call centers, and mobile crisis response at the local level.

Behavioral Health Bridge Housing. $1.5 billion over two years for additional housing supports to those with behavioral health needs. Funding ($1 billion in 2022-23 and $500 million in 2023-24) will be administered through DHCS’ Behavioral Health Continuum Infrastructure Program and can be used to purchase and install tiny homes and to provide time-limited operational supports in these tiny homes or in other bridge housing settings including existing assisted living settings. The budget also references a new strategy the Administration will develop to address the stabilization and treatment of people with acute behavioral health challenges. The strategy will aim to provide community-based care aimed at preventing institutionalization and incarceration through connecting effective treatment programs with safe and supportive housing.

Workforce. There are behavioral health workforce investments in the Governor’s $1.7 billion Care Economy Workforce proposal, including funding to recruit and train 25,000 new community health workers as well as additional psychiatric providers. This investment will be over three years in care economy workforce development across both the Labor and Workforce Development Agency (Labor Agency) and California Health and Human Services Agency (CalHHS) that will create more innovative and accessible opportunities to recruit, train, hire, and advance an ethnically and culturally inclusive health and human services workforce, with improved diversity, wages, and health equity outcomes. Specifically, the Governor is proposing $120 million to create training positions for psychiatric residents, psychiatric mental health nurse practitioners, psychology interns/fellows, and psychiatric nurses. Increasing on-site training programs will assist in building the workforce while also serving as an active recruitment pool for advancement within the health and human services workforce, leading to promotional pathways and increased salaries.

Precision Medicine. As part of the California Initiative to Advance Precision Medicine, the budget includes $10 million one-time for a competitive grant program to support precision medicine-based approaches to preventing, diagnosing, and treating depression. Grant recipients will use computational analytics, next-generation genetic sequencing, and data sharing and aggregation to provide interventions that are tailored to a specific patient.

Medi-Cal Community-Based Mobile Crisis Services. The Federal American Rescue Plan Act of 2021 authorizes 85-percent federal matching funds for a Medicaid mobile crisis response services benefit, available for 12 quarters during a five-year period starting April 1, 2022. DHCS will add multi-disciplinary mobile response services for crises related to mental health and substance use disorders as a new Medi-Cal benefit as soon as January 1, 2023. Over the five-year period authorized by the Act, total costs of this new benefit are projected to be $1.4 billion ($335 million General Fund). The benefit will be implemented through county behavioral health delivery systems by multidisciplinary mobile crisis teams in the community.

Opioid Response. $96 million in 2022-23 and $61 million ongoing General Fund for the Medication Assisted Treatment (MAT) Expansion Project. Additional MAT resources would be targeted towards expanding the Naloxone Distribution Project, supporting 100 new MAT access points statewide, expanding MAT in county jails, and increasing MAT services within state-licensed facilities. In addition, the budget includes one-time $86 million opioid settlement funds which will be dedicated to a public awareness campaign targeted towards youth opioids education and awareness and fentanyl risk education ($50 million) and improving the state’s ability to collect and analyze data on opioid overdose trends ($5 million) for the Department of Public Health, provider training on opioid treatment ($26 million) for the Department of Health Care Access and Information, and distributing naloxone to homeless service providers ($5 million) for the Department of Health Care Services.

CalAIM. $1.2 billion in 2021-22, $2.8 billion in 2022-23, $2.4 billion in 2023-24, and $1.6 billion in 2024-25 for CalAIM. CalAIM initiatives being implemented in 2022-23 include mandatory enrollment into managed care of beneficiaries eligible for both Medi-Cal and Medicare; the requirement that all managed care plans cover long-term care; the provision of a targeted set of Medicaid services to eligible justice-involved populations prior to release; and the Providing Access and Transforming Health (PATH) initiative to further the successful implementation of CalAIM.

Telehealth. While the Administration convened a stakeholder group last fall to discuss the state’s permanent telehealth policies, there is no proposal contained in the January budget. The DHCS budget summary notes that “the Department will release a proposal for changes that continue to allow Medi-Cal covered benefits and services to be provided via telehealth across delivery systems when clinically appropriate.” Telehealth is listed on DHCS’s list of items needing trailer bill language. More to come on this one.

Felony Incompetent to Stand Trial Waitlist. After extensive discussions in the 2021-22 budget process, AB 133 (2021) created an Incompetent to Stand Trial (IST) Workgroup, which met throughout the fall to develop short, medium, and long-term solutions to reducing the Department of State Hospitals (DSH) waitlist challenges. In June 2021, an appellate court affirmed the order in Stiavetti v. Clendenin requiring DSH to commence substantive competency restoration services for all ISTs committed to DSH within 28 days of receipt of the commitment packet from the court. Building off the recommendations from the Workgroup, the budget includes up to $571 million in 2022-23 and ongoing for a variety of strategies, including: Early access to medication stabilization teams to encourage substantive treatment in jail settings, statewide funding for medication support, DSH case management teams to coordinate IST care with counties and other community providers, Infrastructure to increase the number of community residential beds dedicated to DSH Diversion and Community-Based Restoration programs, augmented funding for counties to expand DSH Diversion and Community-Based Restoration, supporting county partnerships for entities impacted by felony IST community placements, and workforce development support for counties and community providers. The budget also indicates the state will implement a growth cap on IST referrals from counties that will include a county cost-sharing methodology if the growth cap is exceeded. 

Increasing Preventative Care. $400 million (General Fund and federal funds) for provider payments focused on closing equity gaps for children’s preventative care measures, maternity care, depression screenings and follow up behavioral health emergency visits. Additionally, the Governor proposes to fund the state’s first-in-the-nation Adverse Childhood Experiences (ACEs) initiative to train health care providers in administering ACEs screenings and recognizing the health effects of childhood trauma. The Governor proposes a one-time expenditure of $135.1 million ($67.6 million from the state’s Mental Health Services Fund, remainder is federal funds) over a three-year period to extend Medi-Cal provider training for ACEs screenings.

Aging Programs. Investments to continue forward with the implementation of the Master Plan for Aging. There is a proposed investment of $2.1 million to enhance the state’s data dashboard to improve outcomes for statewide Master Plan initiatives. The January budget also includes a proposal for a new position at the California Department of Aging to coordinate with county Public Conservators on best practices for serving people with probate conservatorships. In addition, there is $10 million proposed for the Alzheimer’s Healthy Brain Initiative to support activities to address dementia. This funding would be used to support the existing six local health jurisdictions and for an expansion of up to an additional six local health jurisdictions. CSAC is fully engaged with the Administration and the Legislature on the Master Plan for Aging, including proposals that aren’t addressed specifically in the January budget, and will continue that advocacy moving forward.

Early Childhood Programs. $10.6 million for the California Infant and Early Childhood Mental Health Consultation program focused on the behavioral health needs of children, families, and child care providers. 

Conservatorship Reform. During his press conference Monday, the Governor said “conservatorships” many times. After the budget was released, Governor Newsom went on the road to promote it. In his press conference on Wednesday, which was principally about doing more to address homelessness, he mentioned conservatorships again, here are SYASL notes

You may also view the LAO’s overview of the Governor’s 2022-23 proposed budget here

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