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EMERGENCY MEDICAL SERVICES. FUNDING. TELEPHONE SURCHARGE.
Initiative Constitutional Amendment and Statute

THE QUESTION

Should the state increase telephone surcharges and allocate funds for emergency room physicians, emergency rooms, clinics, emergency personnel training/equipment, and the 911 telephone system?

THE SITUATION

Telephone customers in California pay a monthly surcharge of 0.72 percent with a cap of 0.75 percent on in-state calls to support the 911 emergency system. Revenues are deposited in the State Emergency Telephone Number 911 Account and appropriated by the Legislature for 911 operational costs. Increases in cellular phones have resulted in the 911 Account maintaining a reserve from $15 to $80 million a year. 2002-2003 revenues were $139 million.

By law, persons seeking emergency medical care must receive it, regardless of ability to pay. The state compensates hospitals and physicians with about $32 million a year, derived from the Tobacco Tax and Health Protection Act, which assessed a $0.25 per pack tax on cigarettes. Due to the decline in tobacco users, funding is expected to decrease.

Each county may establish a Maddy Emergency Medical Service Fund with specified revenues from criminal fines and penalties. These funds go to physicians for uncompensated emergency and trauma care, hospitals, and other emergency medical services. Even with these funds, hospital and physician services are not fully compensated.

THE PROPOSAL

Proposition 67 would increase funding for reimbursement of uncompensated emergency medical care and other purposes by imposing an additional 3 percent telephone surcharge on bills for in-state calls. The surcharge applies to each separate phone bill. Surcharges for residential customers would be limited to 50 cents per month. This limit does not apply to cellular or commercial telephone services.

Revenues would be deposited into a new 911 Emergency and Trauma Care Fund allowing specified state agencies to expend funds without appropriation by the Legislature. The measure requires counties to establish a Maddy Fund and to transfer a portion of those revenues to the state for reimbursement of county emergency physicians. The plan shifts financial administration from the county to the state.

FISCAL EFFECT

Proposition 67 would raise about $500 million annually for reimbursement of emergency medical services and for other specified purposes. It would continue about $32 million in funding from Proposition 99 and $32 million from the county’s Maddy Funds.

This measure would result in increased onetime and ongoing state administrative expenses of several million dollars and minor administrative expenses at the local level. The increased revenues would cover both types of expenses.

WHAT A YES OR NO VOTE MEANS

A YES vote means the state would impose an additional 3 percent emergency telephone surcharge on bills for phone calls within the state. Revenues would reimburse uncompensated emergency care and fund other specified programs.

A NO vote means the emergency telephone surcharge would continue to be limited to 0.75 percent on bills for calls made within the state.

SUPPORTERS SAY

• Experts predict that more emergency rooms and trauma centers will close if they are forced to continue to provide uncompensated care.
• Rapid response emergency treatment can make the difference between life and death.
• Proposition 67 will provide needed funds to equip and train firefighters and paramedics and upgrade our 911 system.

OPPONENTS SAY

• Proposition 67 is a $540 million, or 400 percent, increase in phone taxes with no cap on small business or cell phone taxes.
• This increased tax could slow California’s economic recovery.
• Ninety percent of the money will go to large health care corporations and special interests with less than 1 percent going to the 911 system.

For more information:

Supporters: Coalition to Preserve Emergency Care, (650) 306-0498, www.saveemergencycare.org

Opponents: No on 67 – Californians to stop the Phone Tax, (916) 930-0688, www.stopthephonetax.com

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