This November, California voters will consider the pros and cons of various ballot measures, including Proposition 44, which aims to set strict spending requirements for nonprofit health clinics. Supporters say the goal is to increase accountability, but opponents worry it could negatively impact patient care and end up forcing many clinics to close.
Prop 44 – dubbed the Clinic Funding Accountability and Transparency Act – would impact Federally Qualified Health Centers (FQHCs) that serve low-income patients and receive federal grants from the Health Resources and Services Administration (HRSA) under Section 330, and clinics that don’t receive Section 330 grants, but meet federal requirements for other benefits.
If it passes, the measure would require these clinics to spend 90% of their annual revenues on patient care. It would also direct the state’s attorney general to provide guidance on what meets the criteria for qualified spending and issue fines to clinics that don’t reach the 90% threshold.
Renee Saldaña, press secretary for the Service Employees International Union-United Healthcare Workers West (SEIU-UHW) – the primary sponsor of Prop 44 – said they want to help “shore up” health clinics and the services they provide to vulnerable populations in anticipation of the looming massive federal funding cuts that are expected to impact California due to H.R. 1 – also referred to as the One Big Beautiful Bill Act – that President Donald Trump signed last year.
“California stands to lose … by our estimates, somewhere between $20 billion to $30 billion in one year once these cuts kick in,” said Saldaña. “With Proposition 44, what we are trying to do is ensure that these clinics stay open – that they don’t have to reduce services, that they don’t have to turn away any patients … [by directing] more of their funding towards direct patient care.”
Prop 44 supporters argue that clinics should spend more on patient care and less on executive pay and overhead. For example, she noted, Cástulo de la Rocha, president and CEO of AltaMed Health Services, earned more than $1.9 million in 2024 according to tax filings. And many other community clinic CEOs across the state are earning “very high” six-figure salaries, said Saldaña.
“These are nonprofit organizations,” she continued. “We are trying to ensure that clinics … [are] spending public health care dollars where it is needed most.”
But if Prop 44 passes, it would actually take much-needed funds away from community clinics, which provide safety-net services for over 7 million Californians annually – including uninsured and underinsured patients, and one in three Medi-Cal patients statewide, said Louise McCarthy, president and CEO of the Community Clinic Association of Los Angeles County (CCALAC).
According to an independent study by the Berkeley Research Group, the measure would result in more than $1.7 billion in penalties the first year alone because approximately 91% of nonprofit clinics would be unable to meet the measure’s arbitrary standards, according to McCarthy.
“The fines and penalties that would be assessed against a clinic if they are not able to meet the strict requirement would go up to the state; it would not go back into health care,” she said. “Taking away money that was meant to go to patient care, you will see a net loss of resources to a health care system at a time when we know that resources are needed more than ever.”
And it would have devastating consequences, said McCarthy, forcing many facilities to significantly reduce the services they can offer or, in some cases, shut down altogether.
Part of the issue is the measure’s “narrow definition” of patient care, continued McCarthy. She said it excludes many services and infrastructure that clinics deem essential. These include translation and transportation services, patient outreach and referrals, security, health care enrollment assistance and automated patient follow-ups via electronic health records (EHR).
“According to the definition of patient care in Prop 44, none of that counts towards the 90%,” said McCarthy. “I would think that the patient who is having someone translate for them during their visit sees that as an essential service, or the electronic health record system, where all of their data is being saved and … protected for HIPAA. … That’s all an essential part of care.”
Saldaña contends the proposition does include various services outside of doctor-patient visits as part of the 90% mandate, such as translation, lab tests, imaging, mental health and substance abuse treatment and janitorial services, which she deems the “backbone of any medical facility.”
“If a facility is not clean and does not have [sufficient] infection control, then nobody’s going to be able to get healthy there,” said Saldaña. “As a union of health care workers, we would never propose an initiative that would defund our own patients, the very facilities that we work in.”
Another concern cited by opponents of Prop 44 – which includes CCALAC, the California Democratic Party, the California Republican Party, the California Medical Association and the California Chamber of Commerce – is that the measure would be “putting law enforcement in charge of health care,” specifically the office of California Attorney General Rob Bonta.
“Our attorney general is amazing. He is doing phenomenal work as a lawyer, as an attorney,” said McCarthy. But, she emphasized, “When it comes to who governs [community clinics], putting the attorney general’s office in charge of overseeing any penalties, any fines and any interpretation of what constitutes [patient care] … is not what consumers need or want.”
The bottomline, said Saldaña, is that Prop 44 has a “simple” objective – to focus on patients.
“We just want to hold [community] clinics accountable [by] putting patients first,” she said, “to make sure that they are prioritizing patient care.”
But McCarthy believes Prop 44 would be harmful to healthcare and is unnecessary, because community clinics are already heavily regulated by both the state and federal governments.
“It’s a bad proposition, and we’re going to fight it,” she said, “because if we don’t, this is going to end up closing clinics.”
To learn more about this ballot measure, go to: www.YesonProp44.com or www.NoProp44.com.