A coalition led by health clinic leaders, union representatives, and patients is advocating for a county sales tax in Los Angeles to mitigate the impact of impending federal healthcare funding cuts. The coalition, named Restore Healthcare for Angelenos, is urging the Los Angeles County Board of Supervisors to place a measure on the June ballot that would introduce a five-year, half-cent sales tax. This initiative aims to prevent service reductions and reduce the number of patients relying on emergency rooms for primary care.
During a gathering in Inglewood on March 1, 2024, coalition members emphasized the urgency of their proposal. Louise McCarthy, president and CEO of the Community Clinic Association of Los Angeles County, stated, “The ballot measure that we are proposing is an urgent and necessary step to stop the damage, to protect access to life-saving care. The stakes right now could not be higher.”
As federal spending plan H.R. 1 begins to take effect, significant cuts to Medi-Cal and changes to eligibility are expected to impact millions of Californians. Estimates suggest that the state could lose tens of billions of dollars annually in federal funding. The coalition projects that the proposed tax could generate approximately $1 billion each year for healthcare services in Los Angeles County. These funds would facilitate local coverage programs, providing essential primary and emergency care as well as behavioral health services for individuals who lose their Medi-Cal coverage and lack alternative options.
The coalition argues that as more individuals become uninsured, the burden of uncompensated care on clinics and hospitals will increase, jeopardizing the availability of healthcare services for all residents. Holly Mitchell, a member of the Los Angeles County Board of Supervisors, is collaborating with the coalition and presented the motion for the sales tax measure to the county. The Board is set to vote on the proposal in April, with a critical deadline of March 6, 2024 for placing any board-sponsored measure on the June ballot.
In an email statement, Mitchell acknowledged the seriousness of the situation, stating, “I do not take lightly asking fellow residents to consider imposing a ½ percent retail tax. This option is on the table because what’s at stake are safety net services unraveling for millions of residents.” She further noted that if approved, the measure would sunset on October 1, 2031, and would be subjected to public oversight and audits.
Should the Board of Supervisors decline to approve the measure for the June ballot, the coalition plans to gather signatures to qualify the initiative for the November ballot, according to Jim Mangia, CEO of St. John’s Community Health.
Efforts to enhance healthcare access for low-income Californians are not limited to Los Angeles. There is increasing pressure on state and county leaders to explore new revenue sources to mitigate the effects of federal funding reductions. During a legislative hearing earlier this week, healthcare providers and advocates urged state lawmakers to seek innovative funding solutions.
In November, voters in Santa Clara County approved a sales tax increase similar to the one proposed for Los Angeles. This measure, known as Measure A, will raise the local sales tax by five-eighths of a cent for five years, generating an estimated $330 million annually for local hospitals and clinics.
Both local proposals are distinct from a separate initiative led by SEIU-United Healthcare Workers West, which calls for a one-time 5% tax on the wealth of California’s billionaires to raise an estimated $100 billion for medical care and social services. California Governor Gavin Newsom has expressed opposition to this wealth tax, arguing it could drive wealthy individuals out of the state, which would negatively impact state income tax revenue.
As voters prepare for the upcoming elections, they may face multiple tax measures, including a city hotel tax in June and a sales tax to support the Los Angeles Fire Department in November. Mangia views the healthcare-focused tax initiatives as complementary rather than competitive. He noted, “We’re doing this to make sure that no matter what happens federally or statewide, residents of L.A. County will have access to healthcare.”
The recent budget reconciliation law under the former Trump administration has introduced several changes that could significantly affect Medi-Cal coverage. Key changes include a requirement for enrollees to log 80 hours of work, school, or volunteering per month starting in 2027, a shift from annual to semi-annual coverage renewals, and limitations on state-imposed taxes on insurers supporting the Medi-Cal program. Additionally, state health officials estimate that approximately 2 million Californians could lose their Medi-Cal coverage over the coming years.
In light of ongoing budgetary constraints, the state has already scaled back coverage for specific groups. Earlier this month, Medi-Cal enrollment for undocumented individuals was frozen, as the state bears most of the costs for this demographic. Furthermore, non-emergency dental care for undocumented adults enrolled in the program is set to be cut this summer. As challenges to healthcare access intensify, the proposed sales tax measure represents a crucial step toward maintaining essential services for Los Angeles County residents.
