Category: Health & Human Services

California’s New Tax Credit

Starting this year, California tax filers with very low incomes from wages are now able to claim a tax credit that builds on the federal Earned Income Tax Credit (EITC). Californians without dependent children can claim the credit if their wages are less than about $7,000, and those with children can claim it if their wages are less than about $14,000.

California joins 25 other states that have their own EITCs. Since California’s credit is brand new, we do not yet know who will claim it. However, our research enables us to characterize the population of those likely eligible for the credit. These estimates are based on family characteristics and incomes reported for 2013.

About 3 million tax filers in California are eligible to claim the federal credit on behalf of themselves and their families. We project that roughly 600,000 filers will be eligible for the California EITC—or about a fifth of those eligible for the federal EITC. If we broaden the scope to include both filers and their family members who will also benefit from the credit, the number of Californians affected by the federal EITC increases to nearly 10 million and by the state credit to 2 million.

Single filers with dependents can generally claim the largest credit. Among those in this group who are eligible for the state EITC, we calculate that the state EITC amount is $932 on average and the federal EITC amount is $2,579, for a combined total of $3,511. This amounts to a 58% boost in earnings on average—20% from the state credit and 38% due to the federal credit. While these filers are working a substantial number of hours (29 hours per week on average), only 37% report working year round (48 weeks or more).

In contrast, single filers with dependents who are eligible only for the federal EITC because their earnings are too high to claim the state EITC see about a 16% increase in income. Compared to those who can claim the state EITC, those eligible only for the federal EITC typically work full time (40 hours a week on average) and year round (83% worked 48 weeks or more).

We know from the research literature that the federal EITC boosts family incomes both directly and indirectly by encouraging work. While it is still too early to assess the full impact of the new California EITC, this early glimpse suggests that the direct effects of the state EITC will be large, at least among a key group of filers eligible to claim the credit.

Community Colleges and Career Technical Education

The governor’s January budget proposal allocates increased funding to support the Strong Workforce Program, which will enable California’s community college system to expand access to career technical education (CTE), commonly referred to as vocational education.

This proposal comes at a time of renewed attention to CTE. The federal 2014 Workforce Innovation and Opportunity Act focuses in part on improving community colleges’ engagement in workforce training. In California, in addition to the investment proposed by the governor, the California Career Pathways Trust—a pilot program created by 2014 legislation—aims to ensure the development and strengthening of career pathway training programs.

California’s community colleges have always played a key role in providing CTE training opportunities. While CTE training can start as early as high school, CTE at the community colleges provides a closer tie to workforce opportunities—to meet both student and employer needs. For-profit colleges, which offer a number of CTE programs, are under increased scrutiny due to poor graduation rates, mounting student debt, and questions about the value of their degrees—putting even more focus on the state’s public two-year colleges to provide training opportunities in high-demand programs.

Training programs in the health care field are a prime example. The health care sector in California is large and growing, providing essential services to the state’s population as well as employment opportunities to a wide variety of workers. And according to our recent report, nearly 200,000 new health care jobs over the next decade will require some college training but not a bachelor’s degree. Given the state’s interest in serving employment needs and diversifying the health care workforce, it is crucially important to understand the ability of California’s community colleges to effectively train health workers for needed jobs.

Beyond meeting the state’s workforce needs, career technical education also has the potential to substantively improve labor market outcomes for a wide range of students. Research has identified sizable labor market returns to obtaining a career technical credential, and the California Community College Chancellor’s Office makes this information publicly available through its Salary Surfer web tool. But much remains unknown, especially why economic returns vary across programs and student groups and why more students do not complete a credential at all. To ensure recent state and federal investments—and future reforms—are effective, it is important to fill the knowledge gaps on the student, institutional, and policy choices that lead to optimal outcomes.

Perhaps more importantly, if vocational training is to be a viable mechanism for improving economic mobility, especially for disadvantaged groups, we need a better understanding of the most promising pathways. Upcoming PPIC research will examine this very issue, looking at student success at California’s community colleges across health CTE programs and student demographic groups to provide a clearer picture of effective career technical education.

Video: PPIC Survey Examines Election Landscape

As California heads into an election year, the PPIC Statewide Survey looks at residents’ views on a broad range of issues that are already flashpoints in the presidential primary races and will likely surface in statewide campaigns next year.

PPIC research associate Lunna Lopes presented the survey’s key findings at a Sacramento briefing last week. She was joined by Mark Baldassare, PPIC president and CEO, for a question and answer session afterward. He noted a link between Californians’ “modestly optimistic view of the economy,” their belief that there is income inequality in the state, and their attitudes about which ballot issues are important. Twice as many residents say that increasing the state minimum wage is very important than say legalizing marijuana is very important.

“In California, the belief that this state is divided into the haves and have-nots—and the feeling among many Californians that they are among the have-nots—are going to be driving forces in the election,” he said. The survey briefing was held just after the mass shooting in San Bernardino, and the briefing touched on Californians’ views about gun laws. PPIC research associate David Kordus provided findings from the September survey on this issue: Compared to adults nationwide, Californians are more likely to favor stricter laws than we have now. Most also say that controlling gun ownership is more important than protecting the right of Americans to own guns.

Immigrants and Health Insurance

California has made major strides in reducing the number of state residents without health insurance coverage. With the state’s Medicaid expansion and the creation of Covered California under the Affordable Care Act (ACA), the percentage of Californians without insurance dropped nearly 5 percentage points in 2014—the first year of ACA implementation. Declines occurred across all racial and ethnic groups, with Latinos registering the largest drop at 9 percentage points. Nevertheless, Latinos continue to experience the highest uninsured rate, in part because the ACA coverage expansions exclude California’s estimated 2.7 million undocumented immigrants.

But there is more to the story of insurance coverage and California’s immigrants: we also observe large declines in the uninsured rate among all noncitizens, a group that includes an estimated 2.6 million people who are legally residing in the state (with green cards, temporary visas, work visas, etc.), as well as those who are undocumented. When we look at uninsured rates across different citizenship categories, we see the drop was larger among noncitizens than among US-born and naturalized citizens—noncitizens had nearly a nine percentage point decline in their uninsured rate.

Noncitizens who legally reside in the state have access to ACA coverage expansions either through the Medi-Cal program—if their household income is below 138 percent of the federal poverty level, about $33,500 for a family of four—or through Covered California, with financial assistance available to help pay for coverage. Still, about 35% of California’s more than five million noncitizen residents currently lack comprehensive health insurance coverage—most are likely to be undocumented, with limited sources for affordable insurance coverage.

Undocumented residents sometimes have private health insurance, most often through their employers. National estimates suggest between 30–40% of undocumented immigrants have coverage. This number could grow if federal immigration reforms are implemented, by providing undocumented immigrants who qualify (between 1.1 and 1.3 million in California) with work permits and better job opportunities that could offer increased access to employment-based insurance.

Along with pending federal action on immigration reform, state legislative proposals are also focusing on expanding affordable insurance coverage options to the undocumented. In our new report, we discuss these potential options and provide new regional estimates of the undocumented population in California by income thresholds to assist policymakers in planning for potential coverage expansions to this group.

Video: Health Coverage & Undocumented Immigrants

Legislative efforts, executive decisions, and public opinion all suggest interest in expanding health coverage to California’s undocumented immigrants. The state’s decision to provide Medi-Cal benefits to undocumented children reflects that support. But the vast majority of undocumented residents in California are adults, and they make up a sizable share of residents without health insurance.

A new PPIC report finds that half of California’s undocumented immigrants—about 1.4 million—have incomes low enough to qualify for full Medi-Cal benefits should legislative proposals to offer coverage be enacted.

This week at a briefing in Sacramento, PPIC research associates Shannon McConville and Iwunze Ugo presented their report, which includes estimates of the number of undocumented immigrants across family income levels and the Covered California insurance regions. These estimates can help policymakers plan for the increase in Medi-Cal participants if coverage is expanded—which will depend on the legislature, governor, and federal courts.

Poverty and Well-being in California

California is one of 12 states in which poverty declined last year, according to newly released US Census statistics. The state’s official poverty rate is down by 0.6 percentage points to 16.4%, from 17.0% in 2012. But poverty in the state remains high relative to the early 2000s. In 2007, the year the Great Recession began, California’s official poverty rate was 12.4%.

Official poverty statistics are intended to capture cash resources at hand. In other research we have analyzed the role of social safety net programs in augmenting cash resources and helping families to avoid dire economic need.

It’s important to note that jobs are still the biggest source of income for Californians overall, even among those living in poverty. And good news out last week shows the economy is continuing to improve—the unemployment rate in California is now 6.1%, less than half of what it was during the worst of the economic crisis.

At the same time we are all aware that well-being is complex, so it is instructive to look at multiple measures. Food insecurity—defined as ranging from worrying about being able to afford enough food to actually cutting back on meals—is also down from a recent high of 16.2% in California (across 2009–2011) and is estimated to be 13.5% for 2012–2014. In addition, the number of homeless in California—often not well-represented in indicators of need—is estimated to have declined by 13% between 2012 and 2014. The share of all California children with a validated report of maltreatment (most commonly for reasons of neglect) has also dropped, although this appears to be a longer term trend that predates the recession.

Broadly speaking, then, trends in well-being appear to be positive, even though we have a ways to go before poverty and other indicators decline to the levels experienced before the recession.

Big Declines in Number of Uninsured Californians

Nearly 2 million more Californians had health insurance coverage in 2014 than in 2013, according to newly released US Census data. Still, about 4.7 million Californians reported they were uninsured in 2014.

The percentage of Californians without health insurance coverage dropped nearly 5 points in the first year the Affordable Care Act (ACA) was implemented—from 17.2% to 12.4%. Declines were even more dramatic among adults age 18 to 64, who benefited the most from the ACA coverage expansions. Among this group, uninsurance rates declined nearly 7 percentage points—from about 24% in 2013 to about 17.3% in 2014.

Declines in uninsurance rates occurred across all racial/ethnic groups, with the largest drops among Latinos (6.5% overall and 9.2% adults age 18 to 64), followed by African Americans (5.7% overall and 8.1% adults age 18 to 64) and Asian Americans (4.9% overall and 6.7% adults age 18 to 64). Despite coverage gains, Latinos continue to have the highest proportion of residents without health insurance, with about 28% of adults age 18 to 64 reporting no coverage.

Changes in uninsurance rates also varied across California counties. The largest declines were in parts of the Central Valley and Monterey County, where the percentage of residents without insurance dropped by more than 6%. The counties that experienced the largest declines include Stanislaus (8.5%), Monterey (6.7%), and Merced (6.4%). Los Angeles County, home to the largest number of residents without health insurance in the state, had more than half a million fewer residents reporting they were uninsured in 2014 than in 2013. Generally, counties with higher shares of uninsured residents in 2013 experienced the largest declines.

California experienced one of the largest declines in the proportion of residents without health insurance coverage across the nation. But the percentage of Californians who remain uninsured is still above the national average – and continues to be higher than in several states that have not expanded their Medicaid programs.

Chart Source (TOP): American Community Survey, One Year Files for 2014 and 2015 accessed at American Factfinder.

Chart Notes (TOP): Individuals are considered to be uninsured if they do not have coverage at the time of the survey. The uninsurance rates presented do not account for the margin of error associated with the estimates. For the state estimates by race the margin of errors range from about 0.1% – 0.5%. The margins of error are larger for the county-level estimates and are larger for counties with smaller populations.

Video: California’s Aging Population

California is on the verge enormous change. In 2030—when the youngest baby boomers have reached retirement age—the state’s senior population will be nearly twice as big as it is today. It will be more ethnically and racially diverse. And many more seniors are likely to be living alone.

These changes have already begun, and their policy implications are wide-reaching. The state’s growing and changing senior population will require more support services and health care professionals. How is California coping with the challenge? That was the question posed to a panel of experts at a PPIC event in Sacramento last week.

“We could be doing better,” said Assemblymember Cheryl Brown, chair of the Assembly Committee on Aging and Long-Term Care. She said information that can help caregivers is fragmented and not easily accessible.

Her assessment was shared by fellow panelists Karen Keeslar, executive director of the California Association of Public Authorities for In-Home Supportive Services, and Barbara O’Connor, a boardmember of AARP.

But Brown sounded a hopeful note. She predicted that as many more Californians—including legislators—begin care for aging loved ones the issue would become prominent. In fact, Brown and her fellow panelists are or have been caregivers for members of their own families. Keeslar noted the sheer number of Californians who are using in-home support services today—507,000, compared to 90,000 in 1980.

O’Connor advocated new models for senior living to help more Californians live as independently as possible—and not necessarily alone at home. Small senior communities are thriving as alternatives to nursing homes in other states, she said.

“It’s not just nursing home versus staying home,” she said.

Before the presentation, PPIC research fellow Laurel Beck provided an overview of a new report, Planning for California’s Growing Senior Population, which she coauthored.

Emergency Room Use and the ACA

With millions of Californians gaining health insurance as a result of the Affordable Care Act (ACA), there is concern about whether the state’s healthcare delivery systems—particularly hospital emergency departments (EDs)—will be able to absorb the additional patients.

These concerns are understandable. EDs are a critical access point to health care for all Californians—and, because they are required to serve patients regardless of insurance status or ability to pay, EDs are particularly important for uninsured and publicly insured residents.

Before implementation of the ACA, the uninsured relied on EDs for care more than those with private insurance but less than Medi-Cal beneficiaries. This was largely because uninsured patients are often billed for the services they receive, while Medi-Cal beneficiaries have either nominal or no financial responsibility for ED visits. Medi-Cal has grown significantly under the ACA—in 2014, monthly enrollment increased by 40 percent to cover more than 12 million Californians.

Newly released state data provides a first glimpse of ED usage under the ACA. While ED usage may shift in the future, these first-year figures suggest there has not yet been a dramatic change statewide. Total ED visits and visits that did not result in a hospital admission did increase in 2014. However, this growth was in line with the upward trend over the past decade.

The proportion of ED visits involving moderate and low urgency continued its recent downward trend in 2014. And there was no discernable change in the proportion of ED visits that required patients to be admitted to the hospital.

The ACA’s impact on the use of health services and health care delivery systems will be the subject of considerable research and a focus for policymakers over the next several years. It will be important to continue to carefully monitor and assess health care use, particularly across different hospitals, regions, and patient groups to ensure that hospital systems throughout California are functioning well and residents have access to the services they need.

SOURCE: California Office of Statewide Hospital Planning and Development, Hospital Annual Utilization Data.

NOTE: The 2014 data is from the preliminary datafile. Figures include information from 292 hospitals that had data available in all years, which represent about 90 percent of all ED visits reported. The urgency or severity level of ED visits that did not result in a hospital admission is based on Current Procedural Terminology (CPT) codes. Low urgency is defined as visits categorized as minor and low/moderate (CPT codes 99281 and 99282). Moderate urgency is defined as visits categorized with CPT code 99283 and high urgency includes visits categorized as severe with and without threat (CPT codes 99284 and 99285).

Regulating Marijuana

In all likelihood, California voters will be asked to decide the legal status of marijuana on the 2016 ballot. Advocates of legalization are hoping to build on the momentum in four states (Alaska, Colorado, Oregon, and Washington) and the District of Columbia that made the recreational use of marijuana legal. Two national advocacy organizations—the Drug Policy Alliance and the Marijuana Policy Project—have made California a major focus for the 2016 election year.

Will a legalization initiative pass in California? Our May PPIC survey suggests that support is relatively high among likely voters: 56 percent said that marijuana should be legal. When we first began asking about legalization in May 2010, California voters were sharply divided. While support for marijuana legalization has fluctuated, since March 2014 we have seen an incremental trend toward support for legalization among likely voters. Among likely voters today, majorities of Democrats, independents, younger voters, and parents favor legalization. However, among some key electoral groups—including Latinos, Republicans, and older voters—legalization fails to get majority support. The success of any initiative aimed at legalizing the recreational use of marijuana is likely to depend on whether supporters can make inroads among these groups.

Would marijuana legalization be good public policy? That is an even more difficult question. This week a Blue Ribbon Commission on Marijuana Policy—chaired by Lt. Governor Gavin Newsom—made a series of recommendations to consider in crafting an initiative. The list includes ways to limit children’s access, reduce illegal activity and regulate sales.

Should an initiative pass, a significant degree of implementing legislation and regulation are likely to follow. In short, the devil is in the details.

These details may not only determine whether legalization is good public policy—they may also affect the electoral fortunes of any marijuana legalization initiative on the 2016 ballot. In our March 2015 survey, Republican (51%) and Latino (56%) likely voters were among the most likely to say they would be bothered if a store selling marijuana opened up in their neighborhood. Similarly, in our May 2015 survey, Republican (58%) and Latino (55%) likely voters were among the most likely to say that they are very concerned about more underage people trying marijuana if it were made legal. The details of regulation and implementation are likely to play an important role in addressing some of these voters’ concerns.

In the coming months, PPIC plans to contribute to the discussion surrounding the legal status of marijuana in the state. As always, our aim will be to provide essential information and help frame the debate. By identifying some of the key issues the state will have to address, we hope to help policymakers—and, ultimately, the voters—improve California’s marijuana policies.