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Op-Ed Archive

The Health Care Safety Net and Health Reform

August 2010

The “Great Recession” that has severely impacted the global economy continues to have a solid grip on California. While measurements of economic growth show signs of modest gains in the national economy, this news comes as small comfort to many Californians, where unemployment remains above 12 percent statewide – and as high as 27 percent in rural areas such as Imperial County. Along with the growth in the ranks of the unemployed, the number of Californians without health insurance has climbed to more than 8 million, bringing countless new clients into the health care safety net after the loss of jobs, homes and health insurance. This added strain on the health care system is compounded for many clinics and hospitals by the ongoing budget stalemate in Sacramento.

Our newly published Annual Report cover story – “Weathering the Storm” – explores the stresses the health care safety net is facing from the economic recession and California’s budget crisis at a time when it is being asked to expand capacity to serve more people. The report also provides a description of some foundations in the state that have responded to this situation, providing low-interest loans, financial consulting services, technical assistance, targeted grants to safety-net organizations and increased emphasis on the provision of general operating support.

Sustaining the health care safety net is of particular importance, given the prospect of federal health insurance reform. In March 2010, President Obama signed into law the Patient Protection and Affordable Care Act, the biggest expansion of public program coverage through Medicaid since that program was created 40 years ago. The reform provides new consumer protections, ensures coverage security for those with insurance, provides new and affordable options for many without coverage, and attempts to control the escalating costs of health care.

A recent poll by the Field Research Corporation found that the majority of California voters support the new law. However, in California, many of the details and key aspects of reform will depend on the state’s ability to adapt and develop necessary elements including, but not limited to, the creation of a health insurance exchange and the significant expansion and strengthening of Medi-Cal and Medicare to serve an influx of new participants. Additionally, the development and implementation of reform in California will occur in the context of the state’s ongoing budget deficit and the already existing shortage of health professionals. California will also face the challenge of helping consumers throughout this diverse state understand and navigate this new insurance and care model.

For the health care safety net, reforms hold substantial promise. Federally Qualified Health Center (FQHC) clinics will see an infusion of federal dollars in 2011 to improve infrastructure and will benefit from new workforce training initiatives designed to address shortages. Ultimately, millions of uninsured Californians will be able to secure coverage through expansion of Medi-Cal eligibility and subsidized coverage envisioned by the exchange.

It is important to bear in mind that reform will not bring expanded coverage until 2014 and, even then, will not provide coverage to everyone living in California. Reform will also not guarantee fiscal stability for every safety-net provider. Millions of undocumented immigrants will remain uninsured, for example, and free or community clinics that lack FQHC status will be ineligible for many of the federally funded initiatives under the new reform law.

Health foundations in California and across the nation are determining how best to use their resources to assist with implementation of health reform. Grantmakers In Health has held teleconferences and webinars for funders to discuss and possibly coordinate efforts. Possibilities range from providing technical assistance to state and local governments to developing public education campaigns to inform the public about various aspects of the new law.

Foundations focused on health can also play a significant role in optimizing the results of health reform by making grants to clinics, hospitals and clinic consortia to sustain the health care safety net and expand access to care for as many Californians as possible as we make this transition. As for The California Wellness Foundation, we will continue our emphasis on the provision of general operating support for the health care safety net and for the advocacy organizations that work on behalf of underserved populations in the state. We will also continue our efforts to increase the health workforce and ensure it has the cultural competence and language proficiency to provide sufficient access to and quality of health care for the increasingly diverse population of California.

Gary L. Yates
President and CEO
The California Wellness Foundation


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The mission of The California Wellness Foundation is to improve the health of the people of California by making grants for health promotion, wellness education and disease prevention.


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