With the latest budget vote Aug. 29 going down in defeat, Bay Area Jewish agencies are coping with the potentially devastating situation of losing millions in funding for programs that assist the elderly, at-risk children, the disabled and many others in need.
The state’s current financial crisis not only places an added burden on organizations to generate more revenue while cutting expenses, but poses an important question to the Jewish community: Who is responsible for taking care of the most vulnerable Jews?
“Addressing poverty has not been at the top of the Jewish agenda and needs to be now,” said Anita Friedman, executive director of the S.F.-based Jewish Family and Children’s Services. “What is the purpose of being Jewish if we don’t fulfill our central mission of caring for the poor? This is the essence of Jewish ethics.”
Because of proposed across-the-board cuts to funding for its medical and mental health programs, JFCS must raise an additional $1 million each year, according to Friedman.
Her agency has already increased its caseload by 25 percent in an effort to assist those no longer receiving help from the government. At the same time, money for specialized programs that help the disabled to become U.S. citizens and the poor to file for tax reimbursements is in danger of being cut significantly.
Friedman added that the state government has held more than $1 million in cash owed to JFCS for medical services already administered, and state officials are restricting eligibility and disqualifying existing and prequalified JFCS patients from Medi-Cal, the state’s version of the federal Medicaid program covering health care services for the poor.
“If we can’t rely on the government, who can we rely on?” said Friedman, whose organization serves more than 60,000 people annually. “The Jewish community needs to mobilize at a time like this. We need all hands on deck.”
With every month that passes without a finalized state budget, the Jewish Home, a nonprofit licensed skilled nursing facility in San Francisco, must secure nearly $3 million in cash to pay its bills, said Daniel Ruth, the Home’s president and CEO.
His agency ultimately will be reimbursed by the state, but without any interest.
“What I find so offensive about this is that our older adults built this country and we’re abandoning them at their time of greatest need,” Ruth said. “Maybe the government feels the poor or indignant don’t have a strong lobby group and therefore can’t advocate.”
On Aug. 20, Gov. Arnold Schwarzenegger unveiled his latest budget proposal that included a temporary sales tax increase of 1 cent per dollar, roughly $9 billion in spending cuts and borrowing about $5 billion against future state lottery sales.
So far, the legislature has failed to agree on a budget deal, marking a more than 60-day impasse with no foreseeable compromise. California was supposed to have a budget in place by July 1, the start of the fiscal year, but lawmakers continue to debate how to close the $15.2 billion spending gap.
While the Jewish Home can withstand the shortfall, other nonprofits that serve the community might not be so lucky. “The longer this goes on, the more some of these smaller organizations will go under,” Ruth predicted.
The legislature had already agreed to impose a 10 percent cut in Medi-Cal reimbursement rates to medical professionals and agencies serving the poor, starting July 1. However, on Aug. 18, a U.S. District Court halted the cuts.
State officials are planning to appeal the decision by U.S. District Judge Christina Snyder of Los Angeles, contending her ruling would cost California roughly $575 million a year. The reductions impacted a large network of doctors, dentists, pharmacists, nursing homes and other adult health care centers that serve the poor.
Nearly half of the nursing residents at the Reutlinger Community for Jewish Living in Danville receive Medi-Cal benefits, and a number of residents in its One Community financial assistance program also have Medi-Cal coverage, according to Executive Director Janice Corran. Should Snyder’s decision be overturned, it would result in higher out-of-pocket costs for those Reutlinger residents and would increase the agency’s dependence on donations to maintain programs and community activities.
“This impacts our revenue at a time when food costs, gasoline costs and supplies have gone up as much at 15 percent in some cases,” Corran said. “We prepared as much as our crystal ball allowed for this possibility.”
If Jewish Family & Children’s Services of the East Bay were to lose its Medi-Cal reimbursement, the agency’s early-childhood services for at-risk kids and their families would be greatly impacted.
The agency’s mental health and case management programs target youth coping with behavioral problems or exposure to violence. The goal of early intervention, according to Executive Director Avi Rose, is to prevent more serious and, possibly, more expensive problems in later years.
“It’s the kind of program that makes good sense from a psychological point of view, as well as a financial one,” Rose said.
Though he’s optimistic at present, Rose acknowledged that mounting concerns over whether JFCS will continue to receive state funding has forced the agency to double its fundraising efforts. Rose said JFCS depends on the government for at least 15 percent of its budget.
“We’ve had to make some cuts in adult mental health services because the reimbursement rates are so inadequate,” Rose said, adding that those cuts were not related to the current budget stalemate.
Jewish Family Services of Silicon Valley, which provides refugee services as well as social, vocational and senior counseling to more than 8,000 people in the South Bay, is taking a “wait and see” approach.
Only after the state budget is finalized will JFS begin to analyze what impact, if any, it will have on departments or programs. Employee salaries are not at risk because they are not funded by the state.
In the meantime, JFS Executive Director Mindy Berkowitz worries that if even a small portion of the agency’s overall state funding — approximately one-sixth of its budget — is taken away, programs for vocational services would be decimated.
“It would be devastating,” Berkowitz said. “We provide really crucial services to refugees and the underemployed. People come out of our program with real jobs, and they wouldn’t have them.”
While JFS has upped its fundraising status to “vigilant,” Berkowitz maintains that the budget delay has not changed the agency’s day-to-day business operations. She admits, however, that the focus of her daily obligations has shifted to actively seeking out more financial support.
Preparation is key, she said, especially when fiscal assurance from the state is at an all-time low.
“Everyone’s raising money in the Jewish community,” Berkowitz said. “When you’re caught off guard, the people you serve can really be in trouble.”
In addition to their own fundraising efforts, Jewish agencies have an ally in the Jewish Public Affairs Committee, a Sacramento-based lobbyist group that represents and protects the interests of agencies throughout California.
Until legislators can agree on a way to end the budget gridlock, JPAC lobbyist Cliff Berg said his committee would continue to fight to keep programs, namely those that support the elderly, from “getting the budget knife.”
“This issue is No. 1,” he said. “[JPAC] reflects the priorities of our constituency. There are many frail elderly members of the Jewish community who are dependent upon these programs.”
JPAC also sponsors educational classes and hosts an annual “Mission to Sacramento,” which attracts nearly 200 activists from across the state to meet with legislators and to lobby issues important to the Jewish community, such as civil rights, social justice and public health care funding.
The Jewish Federation of the Greater East Bay is trying to assist the financial needs of organizations through grants and annual campaigns asking donors to give to specific agencies or issues, said CEO Loren Basch.
“Everybody is struggling here,” Basch said. “I think the whole Jewish community is beginning to feel it. Thank God the Bay Area for the most part has held. But we’re still being very careful.”
Back at the Jewish Home, some of the long-stay beds are being converted for short-stay rehabilitation, a move that Ruth hopes will increase revenue while satisfying a growing need for senior care, exemplified by the Home’s lengthy waiting list.
“It’s an opportunity for the Home to be responsive to an unmet need in the community,” Ruth said. “Financially, it assists us so we can continue to provide the same level of care and service to our medical residents.”
On one floor, 40 continuing-care beds have been replaced with beds designated for short-stay rehabilitation. Residents who occupied the long-stay beds were moved — with their consent — to a different floor, Ruth said.
About 85 percent of the Jewish Home’s continuing-care beds are covered by Medi-Cal, and the Home stands to lose $4 million of its $50 million budget if the Medi-Cal reimbursement rates are cut.
The increasing gap between what the Home receives in Medi-Cal reimbursement from the state and the actual cost of providing long-term care (roughly $25,000 per bed, per year) signaled a need for the transition, Ruth said.
The agency usually garners $400 to $500 per day in Medicare reimbursements for short-stay beds; for continuing-care beds, it receives about $265.
Replacing beds is one aspect of the Jewish Home’s strategic visioning initiative developed by board members and lay people nearly three years ago in response to projected dwindling financial support from the state. Their aim is to gradually reinvent the Silver Avenue campus for the future so it stays relevant and receptive to the Jewish community in a fiscally responsible manner, Ruth said.
He has called for additional adjustments to help offset potential loss of income. He imposed layoffs in the kitchen staff, the Home’s Garden Café is open a few hours less, and the residents’ art program was reduced by an hour a day.
Board members also are constantly reassessing the popularity of programs: If activities lack participants, they could be reduced or eliminated.
“Our organization’s commitment to quality of care and the enriching of our residents’ lives will not be compromised,” Ruth said.
And while Ruth understands the state’s need to balance its budget, the governor’s proposed cuts still sting.
“I’m in the field of aging, so I feel I have to advocate,” Ruth said. “But I’m not naive to the economic situation. We can’t have a $15 billion deficit, and we’ve got to get the state on much more solid economic footing.”
cover design | cathleen maclearie