Unless California's one-month-overdue budget is approved this week by Republican state senators holding out for deeper spending cuts, many agencies providing health and day care services for Medi-Cal recipients will be scrambling for funding, warn Catholic officials.

Although the $140 billion budget was passed by the Assembly on July 26, which also passed a controversial separate bill allowing tax credits for businesses in order to obtain the necessary two-thirds vote, the budget has stalled as members of the Senate Republican Caucus seek spending reductions to produce a balanced budget.

"The longer this stalemate goes on, the more difficult it is for the state to pay its bills, and it will run out of options," said Al Hernandez, a lobbyist for the California Catholic Conference. He noted the absence of a state spending plan is going to adversely affect schools, hospitals and nursing homes that rely on Medi-Cal reimbursement for their funding.

"On Aug. 2, Medi-Cal will have exhausted its contingency funds. The state won't be making $227 million in Medi-Cal payments to hospitals and clinics," Hernandez noted.

Cathy Fickes, St. Vincent Medical Center (Los Angeles) president, said the budget impasse and looming Medi-Cal payment cut-off will cause "a significant and immediate cash flow problem" for the hospital serving many low-income patients in downtown Los Angeles. "We hope they can settle the budget soon," said Fickes.

Last week, the California Catholic Conference and Catholic Charities of California sent a letter to all members of the state Senate urging an end to the budget stalemate. "Once again," the letter stated, "there is the impending prospect that needy individuals will suffer deprivation, county and local governments will face difficulties providing basic services, and California residents will again question the effectiveness of their elected officials."

While the letter questioned the "wisdom of many of the proposed cuts," it expressed "strongest opposition" to the $300 million in spending reductions to "child-only cases" in the state's CalWORKs program. The proposed cuts, according to a July 27 Los Angeles Times editorial, would eliminate CalWORKs payments for more than 150,000 children whose parents aren't meeting their work requirements.

"Parents and individuals, who can work, are and have been working," the bishops said in their letter to senators. "Those remaining on the CalWORKs program have many barriers to full-time employment. These individuals, particularly the children, have a legitimate moral claim on all of us for assistance."

The bishops pointed out that the "child-only" caseload includes foster children, children of seniors or adults with disabilities, children whose parents have lost aid due to sanctions, and children whose immigrant parents are ineligible for CalWORKs. "Terminating benefits for child-only cases will not lead to greater work participation rate," declared the bishops.

Saying he was pessimistic about a quick end to the budget stalemate, Hernandez said CCC members and staff hope a resolution is reached before assemblymembers gets back from their vacation Aug. 20. Otherwise, he predicted, "Public pressure is going to go through the roof."