California Leaders Delay Health Care Minimum Wage Increase to Balance Budget

California Leaders Delay Health Care Minimum Wage Increase to Balance Budget

Sutter Health nurses and health care workers hold signs during a one-day strike outside the California Pacific Medical Center Van Ness Campus in San Francisco on April 18, 2022. (Justin Sullivan/Getty Images)

Travis Gillmore
Travis Gillmore


Updated: 6/27/2024


With the state facing a significant budget deficit, California Gov. Gavin Newsom and legislative leaders have agreed to delay the implementation of minimum wage increases for health care workers.
“This agreement sets the state on a path for long-term fiscal stability—addressing the current shortfall and strengthening budget resilience down the road,” Mr. Newsom said in a June 22 press release announcing the agreement.
With a budget shortfall of at least $46.8 billion impacting the state—after another $17.3 billion was solved in April—the plan includes cuts to hundreds of programs, in addition to spending deferrals and delays.
Also at issue is Senate Bill 525, authored by Sen. Maria Elena Durazo and signed into law in 2023, which set higher wages on a tiered scale based on the health care system—the 12 largest systems in the state would need to pay at least $23 per hour and smaller and rural systems’ wages would be set to at least $18 per hour—with an original start date of June 1.
Citing a need to balance the budget, lawmakers subsequently delayed the date to July 1, the beginning of the next fiscal year, at the end of May with hours to spare before the June deadline.
Now, the timeline is in question, as the agreement under consideration by the Legislature leaves the date open-ended.
According to the agreement, wages will not increase until cash receipts exceed the first quarter forecast by 3 percent or the Department of Health Care Services secures a waiver from the federal government for the hospital quality assurance fee charged to the state.
The prior would push the first possible date to at least Oct. 15 and the latter could result in a start date of Jan. 1, 2025.
“Of course, workers are disappointed that not every low-wage worker in health care will receive raises this summer as the law initially scheduled,” Dave Regan, president of the Service Employees International Union–United Healthcare Workers West, said in a statement emailed to The Epoch Times June 25.
“But we also recognize and appreciate that legislative leaders and the governor listened to us as we mobilized and spoke out this year to insist that, despite a historic budget deficit, California’s patient care and healthcare workforce crisis must be addressed.”
He noted the impact of the pandemic on the industry—with thousands of health care workers, including nursing aides and medical assistants, among others, in the state leaving the field due to “occupational hazards, understaffing, and low wages.”
“We knew we had to take action to address this crisis, which endangers both patients and workers,” Mr. Regan said. “As a result of workers’ tireless advocacy, we are confident that the initial raise for workers who have not yet received it will happen in the fall.”
He expects further increases laid out in the law to occur on schedule.
“This budget means we can stop the bleeding and stabilize a health care system that touches every Californian, and in future years workers will be able to count on the wage increases agreed upon without doubt, delay, or further debate,” Mr. Regan said.
Approximately 426,000 health care workers across the state will be impacted by the decision if it is ultimately approved by the Legislature.
Some critical of the delay pointed to the $20 minimum wage for fast-food workers which began earlier this year as evidence that those in the health care field deserved similar raises.
“Burger flippers get [a] whopping 25 percent wage increase stat,” Donna Cordova—former Sacramento-based news anchor—posted June 23 on X. “People who help care for California’s elderly & sickest residents get promised a slow increase in wages.”
She also expressed concern that with more illegal immigrants receiving access to healthcare due to new laws passed last year, stress levels are increasing for workers while pay increases are delayed.
“Now that’s delayed until likely next year,” Ms. Cordova said. “Meanwhile, their workload increases as [California] expands state health [insurance] to more people.”
One worker in the industry also suggested the discrepancy in pay for workers in certain industries is unfair.
“California increased wages for fast food workers, but health care workers—the people that might actually save your life—have to wait because it affects the state budget,” one nurse posted June 22 on X.
The budget agreement is currently under consideration by the Legislature and must be approved by lawmakers and signed into law before the new fiscal year begins July 1.
It remains to be seen if any changes will be negotiated by the Assembly or the Senate as the plan is debated in the coming days.
The governor’s office and the bill’s author did not respond to requests for comment on deadline.

Travis Gillmore is an avid reader and journalism connoisseur based in California covering finance, politics, the State Capitol, and breaking news for The Epoch Times.

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