Getting your
Trinity Audioplayer ready...Faced with historic federal funding cuts, Santa Clara County’s approved $14.7 billion budget for the coming year hits healthcare particularly hard and slashes 431 mostly vacant positions countywide to close an $800 million deficit.
Despite the cuts, the final budget increased funding to the Department of Family and Children’s Services, including by adding more positions to create independent auditing and oversight within the department. The agency has faced intense public scrutiny and criticism after the high-profile deaths of children under county supervision, including the fentanyl overdose of infant Phoenix Castro and, most recently, the death of 2-year-old Jaxon Juarez. The budget also adds positions to support suicide prevention and funding for gender-based violence prevention.
“This was my most difficult budget, and we had to make difficult choices,” said Santa Clara County Board of Supervisors President Otto Lee in a statement. “While the fiscal challenges ahead remain significant, this budget underscores our commitment to protecting the social safety net and shows that, even in difficult times, we can adapt, innovate and stay focused on serving Santa Clara County.”
The budget, adopted last Thursday and finalized at a meeting this Tuesday by unanimous votes, reflects a slight increase from the overall budget last year and maintains the bulk of the cuts and changes initially proposed in early May.
The county will cut 668 positions while adding 237 new roles, leading to an overall loss of 431 mostly-vacant positions.
Healthcare took the brunt of the cuts, with doctors expecting delays for non-emergency services, even as the county preserved life-saving healthcare. Behavioral Health care also experienced sweeping cuts. The county will close three out of 15 county-operated clinics while relying more heavily on contracted services and opening a Behavioral Health Pavilion to treat youth with psychiatric issues. (County officials insist that service levels will not be affected by the closures, since contracted services will take their place.)
The district attorney’s office also saw cuts — a point of contention over prior months as the District Attorney Jeff Rosen sought to use funding originally proposed for healthcare, though the final budget preserves more attorney-level positions at the expense of support staff.
The new budget comes as the county confronts a looming budget shortfall brought on by stagnating revenues, growing costs and Trump’s landmark spending bill which took massive cuts to Medicaid — the public program that provides health insurance to low-income and disabled individuals and is known as Medi-Cal in California.
The county operates the second largest public hospital system in the state, Santa Clara Valley Healthcare, which runs four hospitals and 15 clinics across the county and relies heavily on revenues from the public insurance program. The Medicaid cuts would take a billion dollars in revenue from the system, a quarter of the hospital system’s operating budget. As part of California law, the county is mandated to ensure that those without insurance can receive care.
While the voters approved a temporary sales tax Measure A last November to help stem the financial bleeding, the measure only addressed part of the expected budget shortfall. As in the budget proposed this May, the $337 million expected annual revenue from measure A will be allocated to the county health system. “The County will continue to deliver on our mission and serve our most vulnerable residents who rely on safety-net services,” said Board of Supervisors Vice President Sylvia Arenas in a statement. “This budget demonstrates our resolve to protect essential programs, support our most vulnerable, and ensure that working families throughout Santa Clara County continue to have access to resources to thrive.”
Even as the county adopts a balanced budget for this year, it could still face a growing deficit it the coming cycles. The county estimates a $500 million dollar deficit next year that could balloon to over $900 million by the year 2029. Those estimates assume a standard economic outlook — unable to take into account unpredictable factors from war to spikes in inflation. Most of the shortfall comes from the cost of running the healthcare system under the historic Medicaid cuts, according to the county.
While both county officials and local advocates have called for the state to help fill the funding gaps, the newest legislative budget falls short of their requests. County executive James Williams expects the most likely incoming governor, former Health Secretary Xavier Becerra, would be more supportive of bolstering healthcare funding, and maintains state support will be essential in coming years. “We are hopeful that we will see a strategic and aggressive response … There is no question that we need a sustained and ongoing commitment from the state to address what otherwise would be catastrophic impacts to hospitals across California,” said Williams. “That is literally a matter of life and death for Californians.”