HIV and the California State Budget: An Expert Q&A

When California Governor Jerry Brown released the proposed state budget for fiscal year 2014-2015, it brought few surprises for the HIV advocacy community.

We spoke with Ernest Hopkins, director of federal affairs at San Francisco AIDS Foundation, about what the proposed state budget means for people living with or at risk for HIV in California—and what happens next.

This proposed budget doesn’t look radically different from last year’s budget; is that correct?

That’s correct, but it’s important to understand that this budget reflects deep defunding from a previous year. What hit me when I reviewed this budget is the lasting impact of the draconian $85 million cuts to the state HIV/AIDS budget enacted by former governor Schwarzenegger. None of those resources have been restored. In fact, today the state General Fund directly contributes $6.65 million to support the HIV/AIDS Surveillance branch. That is an important area to fund—the money goes toward goes toward assessing, for example, the number of people in California who are living with HIV or at high risk for the disease, and the number accessing (or needing to access) HIV-related services—but it’s not ideal to pull those dollars from the state’s overall budget. The proposed budget includes a continuation of that $6.65 from the General Fund.

The majority of California’s HIV/AIDS services, including HIV testing and prevention services, are actually funded through federal programs (Centers for Disease Control and Prevention, Health Resources and Services Administration, Substance Abuse and Mental Health Services Administration [SAMHSA], National Institutes of Health, and Housing and Urban Development) and through pharmaceutical rebate funds through the state’s AIDS Drug Assistance Program (ADAP).
It looks like the proposed funding for ADAP represents a nearly $10 million decrease. Is this bad news for the HIV/AIDS community?

During this transitional period, we would have preferred maintaining the available resources in ADAP so the state would have maximum flexibility to address any unforeseen occurrences during the fiscal year. Having said that, the reduction is not necessarily bad news. The estimated savings is related to an assumption that the number of ADAP clients will be reduced; more than 9,500 clients are expected to transition from ADAP to Medi-Cal managed care and private insurance through Covered California under the Affordable Care Act [ACA].

HIV advocates will continue to closely monitor ADAP to ensure that its capacity to pay for both insurance premiums and out-of-pocket co-pays is maintained. The state Office of AIDS provides very optimistic estimates of their ability to transition clients without loss to care, disruption in provider continuity, and reductions in quality and expertise. HIV advocates are less optimistic and continue to learn anecdotally of clients who are at risk of dropping through cracks in the new system. Lines of communication are open between the HIV advocacy community and the state Office of AIDS and Department of Health Care Services to catch any problems that occur.

What, to you, is the most significant point in this proposed budget? And how will it affect people living with or at risk for HIV?

The most significant point in the budget is its overall assumption that the cost of care will go down dramatically through implementation of the ACA. The HIV advocacy community will closely monitor the assumptions imbedded in the estimates in the proposed budget and their potential impact on client care.

ADAP and the other parts of the Ryan White HIV/AIDS Services Program are essential to the success of ACA implementation for people with HIV. ADAP not only pays for drugs for the uninsured and underinsured, it also pays insurance premiums and co-pays for individuals who qualify for financial subsidies. Part A of Ryan White, which funds large metropolitan areas (such as San Francisco, Los Angeles, San Diego, Oakland, Orange County, Riverside/San Bernardino, San Jose, and Sacramento), completes the “service set” for people who rely on services that their insurance does not cover, and provides basic care for those individuals who do not qualify for ACA or Medi-Cal coverage.

The federal government has imposed a rule that ADAP resources that come to California from the pharmaceutical industry (through rebates on drugs purchased through the program) must be spent before federal ADAP dollars are used. HIV advocates will monitor what impact that loss in flexibility will have on the state's ability to provide access to high-cost drugs approved mid–budget year.

What happens next with this proposed budget, and what will you and other advocates be keeping tabs on as things progress?

Well, this proposal is now before the State Legislature, which will craft its own budget using the governor's draft as a starting point. The various committees of jurisdiction will have a hearing and finally mark up a proposal on how best to allocate state resources.

San Francisco AIDS Foundation and other state advocates will be engaging the state Assembly and Senate caucuses to ensure that HIV/AIDS programs and related programs like Medi-Cal and SAMHSA are fully funded and that the housing needs of people with HIV are addressed. We will also monitor the State Legislature to ensure that policy proposals are supportive of our goals to expand access to expert care, sustain the comprehensive nature of HIV services, and maintain the quality of HIV care available.

Have you seen the impact of HIV advocacy in our community? What are your thoughts on the proposed budget and what it means for people living with the virus? Let us know in the comments below!

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