The Santa Cruz County Board of Supervisors, Santa Cruz County Chamber of Commerce and Health Improvement Partnership of Santa Cruz County join Santa Cruz Community Health in opposing Proposition 44.
If passed, Prop. 44 would impose penalties on nonprofit Federally Qualified Health Centers that spend less than 90% of revenue on program services that advance their charitable purpose.
FQHCs are community clinics that provide primary care to medically underserved areas and populations. These are safety-net clinics that receive federal funding to provide such care.
The proposition would authorize the California Department of Public Health to levy penalties for not meeting the “mission spend ratio,” which would be calculated annually by the Attorney General. The penalty would be equal to the difference between the 90% requirement and the amount the clinic spent on mission-related expenses in that year.
The initiative has gathered more opponents than supporters as many healthcare groups voice their concerns over Prop. 44, also known as The Clinic Funding Accountability and Transparency Act.
Opponents include the American Academy of Pediatrics California, California Primary Care Association, California Medical Association, California Hospital Association and the California Democratic Party.
Anita Aguirre, CEO of Santa Cruz Community Health, said Prop. 44 is a “reckless ballot measure that would take critical resources away from community health centers” and “threaten access to care for millions of Californians” in her speech to the Santa Cruz County Board of Supervisors on Sept. 29.
The Board voted to oppose Prop. 44 and send letters of opposition to the state legislative delegation.
In Board Chair Monica Martinez’s letter to Assemblymember Gail Pellerin, the Board said the 90% revenue formula “excludes many functions essential to care,” including call centers and appointment scheduling, referral coordination, translation services and more.
Santa Cruz County Health estimates the county would face an approximately $2.47 million penalty based on its 2023 federal tax filing.
“Penalties of this scale could force reductions in service and clinic closures at a time when providers are already contending with federal and state funding pressures,” Martinez said.
The initiative is backed by Californians for Responsible Healthcare, which is sponsored by the healthcare labor union SEIU-UHW West.
Supporters said clinics should spend more on direct patient care and less on executive pay and overhead.
Yes on 44 said the initiative holds clinics accountable by requiring clinics to publicly report how healthcare dollars are spent and that it does not cut clinic funding or reduce services.
“It holds clinics accountable for the public dollars they receive, and it lets patients and taxpayers finally see where the money goes,” wrote Santa Carranza, a San Diego community clinic social worker, to CalMatters.
Syd Fluker is a California Local News Fellow. Visit fellowships.journalism.berkeley.edu/cafellows.
