San Jose Mercury News
December 13, 2000

San Jose pours $3 Million from tobacco fund
into kids' insurance
By Michele Guild

The San Jose City Council on Tuesday said over the next three years it will put more than $3 million of the city's tobacco settlement money into the Children's Health Initiative -- the historic plan to provide health coverage to all kids in Santa Clara County.

Just six months ago, the same council narrowly voted down a proposal to fund that project, which would have made it the first city in the nation to provide health coverage to all of its uninsured children.

"I'm proud to recommend that the city council approve this funding to improve the lives of children in San Jose," said Mayor Ron Gonzales. "This is about the health of our children and our families."

Under the initiative, the roughly 71,000 children in Santa Clara County without health insurance could receive full coverage, including vision, dental and comprehensive medical care. More than half of those youngsters live in San Jose.

The Children's Health Initiative is the product of cooperation between the faith-based community group People Acting in Community Together, the labor-affiliated Working Partnerships USA and Santa Clara Family Health Plan, the county's Medi-Cal HMO.

"Today is an important and historic day. Not since the passage of Medicare has something so comprehensive been achieved," said Amy Dean, chairwoman of the South Bay Labor Council. "I hope that today's victory will spread throughout the state and the nation like seeds being carried by the wind."

After San Jose rejected the initial proposal last summer, Santa Clara County stepped in. And last week the Board of Supervisors formally approved a first-in-the-nation plan to ensure that every child in the county has health insurance.

Santa Clara Family Health Plan will administer the health initiative. It will process applications from families, pay claims, contract for outreach and handle fundraising. The county expects to begin enrolling families Jan. 2, and to start operations in February. Anyone up to age 19 is guaranteed coverage under the $14 million-a-year initiative.

Already, the Santa Clara County Children and Families First Commission has pledged $2 million a year of the tobacco tax money it expects to receive as a result of Proposition 10, a 1998 state initiative that collects money for childhood programs. County supervisors also approved an additional $3 million in tobacco settlement money Tuesday.

Last summer, Gonzales led the opposition to the insurance plan, saying the city had no experience in managing such a program. Instead, he appointed a task force -- the Healthy Neighborhoods Venture Fund Advisory Committee -- to decide how the city should spend its $10 million in annual tobacco settlement money.

"I always felt there would be an opportunity to fund children's health insurance," Gonzales said Tuesday. "And the task force answered many of the questions I posed some time ago."