Governor Newsom's FY 2022-23Proposed State Budget


  • Governor Newsom’s 2022-23 State Budget demonstrates a strong commitment to address California’s immediate needs, moving California closer to an equitable recovery and preparing for a more inclusive
  • We are excited the Governor builds on prior investment in health access to push California to be the first state in the nation to offer Medi-Cal to all low-income persons regardless of their age or immigration status. We are supportive of the unprecedent new workforce funding for primary, preventative, and behavioral health care workforce. Specific investments are needed to address CHC workforce challenges.
  • While all of these investments will touch the communities we serve, we look forward to working with the administration in the coming months to understand how some of these proposals will intersect with immediate CHC needs, including the fiscal challenges brought on by Medi-Cal Rx.

Health Center Budget Priority: Health4All

  • With this budget, California is on track to finally expand full-scope Medi-Cal eligibility to include all income- eligible adults aged 26 through 49 regardless of immigration status (estimated to be over 700,000 individuals).
  • Closing this gap, Medi-Cal will be available to all income-eligible Californians regardless of age and immigration status in 2024.
  • CHC Ask: California CHCs are proud to see this commitment. We look forward to working with Health4ALL
    coalition partners and that Administration in implementing this proposal.

Health Center Budget Priority: Medi-Cal Rx Transition – Supplemental Payment Pool Augmentation

  • Governor Newsom continues to remain committed to providing a non-Hospital 340B Clinics Supplemental Payment Pool (SPP) Fund of $105M annually.
  • While we are pleased to see the administration’s ongoing commitment to the SPP, this proposal ignores CHCs ongoing request to recognize the full financial burden of the Medi-Cal Rx transition.
  • More funding is critically needed. Increasing the SPP to $205M (an additional $50M general fund commitment) will ensure patient services remain intact.
  • Since 2019, the California Primary Care Association (CPCA) conducted two member surveys to understand the financial impact that the pharmacy transition (Medi-Cal Rx) would have on CHCs 340B savings. After reviewing this data, CPCA believes CHCs will experience losses that are greater than $200M.
  • The loss of 340B savings will impact patient services by reducing hours of operations for both primary care sites and pharmacies, which will translate into limiting access to pharmaceuticals, increasing wait times for patients to be seen and overall patience access.
  • CHCs will also be forced to eliminate programs and services that rely on 340B savings and do not have other funding streams. {INSERT INFORMATION ON PROGRAMS OR SERVICES THAT WILL BE ELIMINATED}
  • By increasing the SPP the Administration and Legislature would mitigate the potential harm the Medi-Cal pharmacy benefits transition will cause community health centers, an integral part of the safety net, and their patients.
  • CHC Ask: It is critically important that the state commit an additional $50M general fund commitment, which would draw down an additional $50M federal match, to strengthen the non-hospital clinic supplemental payment pool to a larger pool of funds that better represents the true cost of this transition.

Health Center Budget Priority: Medi-Cal Telehealth Flexibility and Payment

  • Governor Newsom’s commitment to continue telehealth flexibilities and build on the commitments of AB 133 (2021) can be seen in this budget proposal.
  • This proposed budget assumes funding for payment parity, including for audio-only care (which we are grateful for). CHCs continue to be optimistic regarding the future of telehealth access.
  • CHC Ask: We look forward to working with the administration as trailer bill language becomes available.

Health Center Budget Priority: Health Care Workforce

  • We applaud the Governor’s intent to bolster California’s health professional workforce with $1.7 billion investments across the Labor Agency and Health and Human Services Agency.
  • We are particularly excited to see new investments to grow and support community health workers and the behavioral health workforce.
  • CHC Ask: We respectfully ask the Administration and Legislature to commit $51M in new funding for educational debt relief, advanced practice clinician training program, and residency programs that are most essential to CHC’s recruiting and training their future workforce while maintaining the workforce of today. Specifically: 
    • $29.3 million for Loan Repayment & Scholarships Programs
    • $10.6M investment to the California State Loan Repayment Program to increase the number of awards granted to primary care and behavioral health providers.
    • $17M investment to the Allied Health Loan Repayment Program to enhance private investment and provide 1,060 new awards across all underserved areas in the state.
    • $1.7M investment to Allied Health Scholarship Program to build on private investment and double program awards through additional 125 scholarships.
      • $16 million for Advanced Practice Clinicians Training Programs
    • $15 million to support 150 Nurse Practitioner postgraduate fellowship opportunities in primary care within underserved communities and through the Song-Brown Healthcare Workforce Training Program.
    • $1 million to support 10 or more Physician Assistant postgraduate fellowship opportunities in primary care within underserved communities and through the Song-Brown Training Program.
      • $5.7M for Graduate Medical Education
    • $5.7M for Teaching Health Centers through the Song-Brown Primary Care Residency Program to support significant expansion of via an additional 33 program awards.

CaliforniaHealth+ Advocates 2022 Sponsored Bills

SB 939 (Pan): Prohibiting Discriminatory Contracting in the 340B Pharmacy Program

The 340B Drug Pricing Program is an essential source of support for CHCs and their patients. CHCs reinvest the savings from the 340B program into patient services, such as patient navigation, transportation, and other critical services. In recent years, community health centers have grown increasingly concerned about actions by pharmacy benefit managers (PBMs), manufacturers and others who are taking 340B savings from CHCs and their patients impacting patient services while also threatening patient access to critical medicines made affordable through the federal 340B Program. The legislature must prohibit discriminatory actions by PBMs and drug manufacturers when providing 340B drugs to CHCs and their patients. These important consumer protections are necessary to protect patient services and access to low-cost drugs.

Senate Bill 939 would prohibit discriminatory actions by PBMs and drug manufacturers when providing 340B drugs to CEs and their patients. These important consumer protections are necessary to protect the remaining 340B savings for CHCs and their patients.

Status: Senate Health Committee 

SB 966 (Limón): Increasing Behavioral Health Access
Our state is an extreme workforce shortage, leaving community health centers with decreased capacity to meet the increased demand of behavioral health services for California’s vulnerable safety net. Additionally, the ramifications of COVID-19 on mental health are extensive, and often disproportionately harmful to populations that have historically been marginalized. In May 2020, DHCS (and pursuant to SPA 20-0024) temporarily allowed Associate Clinical Social Workers (ASWs) and Associate Marriage and Family Therapists (AMFTs) as billable provider types for FQHCs and RHCs, contingent on the declared COVID-19 public health emergency. This flexibility has greatly increased access to behavioral health services and helped meet the increased patient demand during COVID-19. The looming concern for health centers is the inability to continue utilizing this workforce upon the expiration of the public health emergency greatly decreasing the ability to offer access to care and almost certainly interrupting continuity of care for patients finally receiving treatment. Behavioral health care should not be separate from the rest of the body. Training Associates in community health centers allows the future workforce to have field training in integrated care, where Associates will be working with a team to address both medical and behavioral health conditions. Health centers consider a patient’s physical, behavioral, and social determinants of health and are positioned to treat the whole person, not just a single ailment or diagnosis.

Senate Bill 966 would extend flexibilities allowed during the declared public health emergency to hire and bill for ASWs and AMFTs, therefore sustaining continuity of care for patients and increasing access to a diverse behavioral health workforce. This bill will also remove the current administrative barrier to utilizing LMFTs by aligning FQHC/RHC Medi-Cal Change in Scope-Of-Service Request (CSOSR) requirements for both medical and behavioral health services, ensuring that health centers are not disadvantaged when trying to bring in critical behavioral health workforce.

Status: Senate Health Committee 

SB 316 (Eggman): Same Day Visit

Currently, CHCs may bill for a behavioral health visit or a physical health visit in a 24hour period, but will not be reimbursed for both. This means that patients with a medically necessary behavioral health condition must wait 24 hours before they can be seen for a visit if they already obtained a physical health visit on that same day. This restriction undermines a clinic’s ability to provide or expand behavioral health services that are in even greater demand as a result of this pandemic. SB 316 would ensure that FQHCs and RHCs are adequately compensated for the care they provide and can continue to strengthen care coordination and integration for the millions of patients our systems serve.

Status: Assembly Floor

Status: Assembly Floor

For more information on the State Budget or sponsored bills please contact Beth Malinowski, Director of Government Affairs, at