News Headlines Article

Feds approve California’s health plan tax swap
Sacramento Bee

The Obama administration has signed off on California’s expansion of a tax on health plans that contributes hundreds of millions of dollars to Medi-Cal and other programs, with plans receiving offsetting breaks on other state taxes.

Tuesday’s announcement, after about two months of review by the federal government, comes a few days after Gov. Jerry Brown released a revised budget that assumed revenue from the health tax passed by lawmakers Feb. 29. The tax on managed-care organizations will bring in an estimated $1.1 billion for Medi-Cal, the state’s health care program for the poor, as well as allocating more money to people with developmental disabilities and other programs.