A ballot initiative to require nonprofit federally qualified health centers (FQHCs) and FQHC Look-Alikes to spend at least 90% of their annual total revenue on expenses that advance the health center's mission qualified for the general election in California. The initiative defines the spending requirement as a mission spend ratio.
A FQHC is defined in federal law as a community-based healthcare center that provides primary care and other services in underserved areas and qualifies for certain reimbursement systems under Medicaid and Medicare. An FQHC Look-Alike is an organization designated by the federal Health Resources and Services Administration as meeting FQHC program requirements.
The initiative would also require the attorney general to make the data reported to calculate the mission spend ratio publicly available on its website within 90 days of receipt, along with the calculated mission spend ratio. The initiative would authorize the attorney general to conduct audits to verify the accuracy of submitted information and ensure compliance with reporting requirements.
The initiative would authorize the state Department of Public Health to levy penalties for failing to meet the 90% mission-spend ratio. The penalty would equal the difference between the 90% requirement and the clinic's mission-related expenses for that year.
Californians for Responsible Healthcare, sponsored by SEIU-UHW West, is leading the campaign in support of the initiative. It reported more than $13.9 million in contributions, with all contributions from SEIU-UHW. The campaign submitted 1,030,848 signatures for verification on April 1. To qualify for the ballot, 546,651 signatures needed to be valid. The secretary of state reported that at least 634,061 were determined to be valid through a random sample count.
The campaign website said, “With massive cuts to federal funding, it’s time to ensure community clinics are spending our tax dollars where it is needed most: on patient care. Not executive pay and other non-essentials.”
No committee has registered in opposition to the initiative. On April 30, California Primary Care Association and Open Door Community Health Centers filed a lawsuit against the initiative in the U.S. District Court for the Northern District of California arguing the measure violated federal laws and regulations regarding strict spending requirements on nonprofit health clinics that serve low-income patients.
Graciela Soto, CEO of Altura Community Clinic in Tulare, said, "We pick up our patients to and from their house to the clinic at no cost. This would not be considered part of the mission service. We hire Zumba instructors to try and target obesity. We work with farmworkers and dairy workers — lechería — by providing health and blood screenings and education, all of which would be decimated by the initiative."
This is the second initiative sponsored by SEIU-UHW West to qualify for the ballot. The first would create a compensation limit for CEOs, executives, administrators, and managers of health care corporations. The union has also submitted more than 1 million signatures for an initiative that would levy a one-time 5% tax on billionaires in the state to fund health care, education, and food assistance programs. The random sample count for the initiative is due June 18.
The California Hospital Association, which opposes the mission spend ratio initiative and health care executive compensation initiatives, is sponsoring an initiative to require health care labor unions, like SEIU-UHW West, to inform members annually how member dues are being spent on political activities, specifically spending on state and local ballot measures, and require a majority of members to approve such expenditures. The campaign filed more than 900,000 signatures for verification on April 26. The random sample count is due June 11.
In November, California voters are set to decide on seven other measures — four initiatives and three legislative referrals — that address:
- Allowing the state and local governments to create programs that provide candidates with public funds under spending limits and eligibility rules;
- Eliminating the successor election when a state officer is recalled, thereby leaving the office vacant until it is filled according to state law;
- Requiring initiatives that change vote thresholds to supermajority votes to pass by the same vote requirement as is being proposed;
- Creating a compensation limit for CEOs, executives, administrators, and managers of health care corporations;
- Establishing a second mortgage homebuyer program for qualified homebuyers on qualifying homes and issuing $25 billion in bonds to fund the program;
- Requiring a two-thirds vote by the electorate to enact special local taxes enacted by successful citizen initiative campaigns and prohibiting charter city from levying real estate transfer taxes; and
- Requiring voters to present government-issued identification when casting ballots and requiring election officials to use government data to confirm voter citizenship and report verification rates.
Ten other initiatives are pending signature verification. The deadline to qualify or withdraw an initiative from the California ballot is June 25 (131 days before the election).
Additional reading: