State of California Greenlights Up to $1 Billion for COVID-19 Response

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California Gov. Gavin Newsom (D) signed a spending package of more than $1 billion on Tuesday, March 17, 2020, to help California hospitals and communities grappling with the COVID-19 pandemic.

Both houses of the California legislature—the California State Senate and Assembly—passed a pair of bills, S.B. 89 and S.B. 117, on unanimous votes—32-0 and 69-0, respectively—with some older members absent from the proceedings for their protection. The swift action put the legislative package on Newsom’s desk in just two days, thanks to a waiver of California requirements for legislation to be in print for three days before lawmakers can act.

The funds will allow hospitals to purchase more beds and medical equipment as coronavirus cases inevitably rise, Newsom said in a statement. Newsom said that California right now has only about 74,000 hospital beds, including 11,500 intensive care unit (ICU) beds. It also has “surge capacity” of 8,661 more beds, and about 7,600 ventilators in the existing hospital system, with perhaps 700 more as backup.

S.B. 89 sets aside $500 million for the emergency response, with the possibility of later increases to $1 billion. S.B. 117 appropriates $100 million to help schools and child care centers address the pandemic and ensure they receive funding despite closures, helping the facilities pay for personal protective equipment, supplies, and labor for cleanup. A copy of S.B. 89 can be found here, and a copy of S.B. 117 can be found here.

As of the time of signing, the state had approximately 500 people who tested positive for the virus and 11 deaths—as of 12:08 p.m. Eastern on March 23, that number has more than tripled to 1,828 infected and 35 deaths.

Newsom also authorized emergency aid to local governments and implemented emergency protective measures to mitigate the spread of COVID-19 among the homeless population, many of whom have no option to self-quarantine or isolate. As a result of Newsom’s actions, California will procure 1,309 travel trailers from FEMA and private vendors to provide quarantine capacity for the homeless. The press release from Tuesday can be found here.

Newsom’s administration also sent a letter to CMS requesting a Section 1135 waiver to allow more flexibility in how healthcare providers can treat Medi-Cal patients, as well as patients enrolled in other federally approved healthcare delivery systems, including county health and mental health programs, Drug Medi-Cal Organized Delivery Systems (DMC-ODS) and the Children’s Health Insurance Program (CHIP). The requested flexibilities include those with respect to provider participation, billing requirements, conditions for payment, service authorization and utilization controls, state fair hearing requests and appeal deadlines for managed care enrollees, benefits, telehealth and virtual visits, payment rates, eligibility, and administrative activities. The letter to CMS can be found here. California joins several states seeking such waivers, including Washington and Florida, as reported in this issue.

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