Health Equity: California Style

Health Equity State Health Policy

Health equity has become a familiar buzzword in public health. There is, however, little consensus about what it means and how to measure it. California, the most diverse of all states, recently used principles of health equity in its response to the COVID-19 pandemic. The state is currently working on two important new developments in health equity: legislation to establish a health equity fund, and Medi-Cal waivers to address health equity.

Defining Health Equity

Braveman and colleagues defined health equity as meaning that “everyone has a fair and just opportunity to be as healthy as possible. This requires removing obstacles to health such as poverty, discrimination, powerlessness, and their consequences—including lack of access to good jobs with fair pay, safe environments, and quality education, housing, and health care.” This definition explicitly places the concepts of fairness and justice at the heart of the notion of health equity. The idea of health equity is also based on theories of social and distributive justice. This means that health care is distributed according to need and not based on personal characteristics or economic and social position. We find this definition the most useful and compelling. One way to visualize what health equity means in more concrete terms is to imagine a pair of dice being tossed to determine who will have better and who will have worse health. The dice historically have been loaded in favor of white, wealthy, and powerful individuals, and against people of color, low-income individuals, and those who lack political representation. A fair and just opportunity for health might mean unloading the dice, so that everyone has an equal chance at being as healthy as possible. Efforts to achieve health equity should not, however, allocate equal resources or treatment for everyone. Equalizing chances to be healthy requires allocating greater resources and support to those who have previously been excluded or marginalized. Those who have experienced social disadvantage need more, not merely equal, attention to address the health damage caused by discrimination, economic hardship, and powerlessness.

Health disparity is a closely related but distinct concept. Healthy People 2020 defines health disparities as “a particular type of health difference that is closely linked with economic, social, or environmental disadvantage.” Braveman writes that the core concept of health disparities is based on “…concerns about social justice—that is, justice with respect to the treatment of more advantaged vs. less advantaged socioeconomic groups when it comes to health and health care.” If we eliminated all disparities, we would have an equitable health care system.

How Did California Address Health Equity During the Pandemic?

Health equity was a main focus in California’s COVID-19 response, led by Governor Gavin Newsom and Secretary of Health and Human Services Mark Ghaly. Governor Newsom added an explicit equity focus to his COVID-19 reopening plan for California’s 58 counties, known as “The Blueprint for a Safer Economy.” Counties had to prove that they were accounting for health disparities by outlining targeted investments to hinder disease transmission in the most vulnerable and affected communities, as well as satisfying an equity metric for “test positivity in the worst-off census tracts.” Targeted investments could include contact tracing, outbreak management for vulnerable communities, free COVID testing and/or education or outreach for vulnerable populations. Each county needed to make a health equity plan, which had to include the percentage of COVID-19 cases in the county’s disproportionately impacted populations, while also defining who the impacted populations are, as well as a plan to invest a significant portion of their federal pandemic response funds to reduce and prevent disease transmission among vulnerable populations.

The main equity metric used in this process was the California Healthy Places Index (HPI), which includes 25 community attributes linked to education, health/health care, economic stability, social and community background, and the surrounding environment. The lower a county’s HPI, the greater the inequities, disadvantages, and marginalization that community faces. California’s policy led the way, as it was the first state to include health equity in decisions to reopen local economies, with fewer restrictions for counties where the test positivity rate of the lowest-quartile HPI census tract was not significantly higher than the county’s overall positivity rate. Because California is the most populous and diverse state in the United States, addressing health equity poses the greatest challenge, but it is possible to achieve, as California ranks 18th best among the 52 States and territories in terms of death rate from COVID-19. Compared to other states with large populations, such as Texas, Florida, and New York, California has done significantly better in terms of death rate, with a death rate of 184 per 100,000 people compared with 246 per 100,000 in Texas, 278 per 100,000 in Florida, and 291 per 100,000 in New York.

Governor Newsom and Secretary Ghaly also focused on health equity during California’s COVID-19 vaccine rollout, seeking to vaccinate vulnerable and hard-to-reach communities, while also investing in these communities, making vaccines more easily accessible, and addressing vaccine fear and hesitancy. These strategies include increased transparency about California’s vaccination progress, phone and text banking, door-to-door campaigns, increased partnerships with philanthropic and community-based organizations, an at-home vaccination program, free transportation to vaccine appointments, additional grants to fund vaccine equity, and targeted outreach with mobile clinics and smaller clinics within communities. The new strategies also include extra funding to support community-based organizations helping hard-to-reach communities. Over 480 organizations have been engaged, helping communities and individuals make appointments and obtain referrals.

Additional grants to fund vaccine equity in California’s most vulnerable and high-risk communities were also allocated, with funding dependent on each county’s population size. Each county used administrative tactics to increase equity with the vaccine rollout, including allotting twice as many vaccine appointment slots for the most vulnerable and hardest hit communities, navigation assistance for making appointments, reserving at least 40% of appointments on MyTurn for disproportionately affected communities, and providing technical assistance and start-up funds to safety net providers. Counties must demonstrate that at least 40% of their vaccine doses are being administered to communities hardest hit by COVID and with low-income residents.

It might be argued that addressing health equity gets in the way of efficiency and therefore should be ignored while fighting the pandemic, but California has proved this wrong. As noted, not only does California rank 18th best among States and territories in terms of COVID-19 death rates, but it also ranks 16th among States and territories in terms of vaccinations. As of November 2021, 74% of California’s population had received at least one vaccine dose, while 62% of the population was fully vaccinated. Furthermore, according to the Kaiser Family Foundation, as of November 1, 2021, vaccination rates in California were significantly higher than the national average for every race, with 66% of white people, 56% of African American people, 54% of Hispanic people, and 76% of Asian people having received at least one vaccine dose. These data suggest that focusing on health equity helped to fight the pandemic and may have decreased transmission rates and death rates, while improving vaccination rates.

California’s Health Equity Fund Proposal

Assembly Bill (AB) 1038, introduced by Assembly Member Gipson, is a pending bill that works to address health equity post COVID-19. The bill would create the California Health Equity Fund with proposed support of $60 million per year over three years. Working with communities most critically affected by the COVID-19 pandemic, the Fund would help them choose and implement policy, systems, and environmental change approaches to alleviate the health and social impacts of COVID-19. The Fund also will examine the growing risks for adverse childhood experiences (ACEs) arising from detrimental social and educational impacts of the pandemic on children. Over 60 organizations and nonprofits support the AB 1038 and the budget request.

Many ideas have been proposed for how a California Health Equity Fund would operate. First, it would provide funding to clinics, nonprofits, local health departments, and tribal organizations in urban and rural areas most impacted by the pandemic. Funding could help communities make change in such areas as food security and healthy diets, schools, childcare, economic stability, housing security, health-promoting built environments, and environmental justice. Not only would local needs be met, but the Fund would also address pressing challenges by investing in a resilient future for these communities. Furthermore, social determinants of health, local needs assessments, and indices of health inequalities would be used to implement approaches targeted to local needs from the list of allowable uses. For more details on who administers the funds and the oversight committee, see the AB 1038 Fact Sheet.

Medi-Cal Waivers and Health Equity

California has applied for two Medi-Cal waivers collectively referred to as CalAIM (California Advancing and Innovating Medi-Cal), which is a broad-based delivery system and payment reform for Medi-Cal. CalAIM is focused on moving its “whole-person care” approach to a state-wide level, with the goal of reducing health disparities and inequities, and improving health outcomes. The CalAIM 1115 demonstration & 1915(b) Waiver, as well as relevant Medi-Cal State Plan and contractual changes, will aim to improve health outcomes for Medi-Cal enrollees by providing benefits to high-need and hard-to-reach groups, as well as increasing alignment across delivery systems, and reducing barriers and complexity, while also increasing flexibility. Key components of the waiver include Whole Person Care Pilots, the Health Homes Program, the Coordinated Care Initiative, and public hospital system delivery transformation.

Structural Changes to Achieve Health Equity

To help move California toward health equity, structural changes on both the supply side and the demand side are needed.

On the supply side, California needs to address disparities in the health care workforce. More than 60% of physicians/surgeons are white, and just over 25% are Asian or Pacific Islander, while only 5% are Latino, 3% are African American, and fewer than 1% are Native American. Meanwhile, among health care support occupations, one in three workers are Hispanic or Latino and a large proportion are African American. Currently, the ethnic composition of medical students will not overcome this disparity, as it was estimated in 2019 that 8% of California medical students are African American, 14% Latino, 40% Asian, and 36% white. A recent study in Oakland, California found that physician/patient racial concordance improves a patient’s likelihood of utilizing preventive services. Moreover, the mortality gap between Black and white men in cardiovascular disease was reduced with increased racial concordance. More needs to be done to match the supply of physicians and other health workers to the ethnic and racial diversity of California.

On the demand side, The Healthy California for All Commission is working on a proposal for a single payer financing system or a unified financing system (putting all sources of health care financing into one state pool) to recommend to the legislature and the Governor. If this approach were to be adopted, it could lead to significant structural improvements in health equity. All Californians would have access to the same basic health care benefits provided by the State, and providers would receive the same payments for every patient and would have no incentive to treat them differently.

By making each patient equally valuable to providers, personal characteristics such as socioeconomic status would not advantage one person over another. Eliminating the overly complicated paperwork to sign up for benefits and to access care will also be crucial in reducing disparities. Moreover, if the system were financed by a progressive tax, it would improve the distribution of income and enhance financial equity as well. Finally, California’s ability to measure health disparities would improve dramatically if claims were uniform and clinical data systems could follow individuals over the life course. A single electronic health record system would improve interoperability for data exchange among providers and enhance the quality of health care for all.

If California were a country, it would have the fifth largest economy in the world. California spends over $122 billion annually on health care, giving it enormous market power. There is little doubt that California has the economic resources necessary to address health equity. We urge other states to develop and implement their own unique health equity agenda to achieve substantive change without delay. A good starting point for states would be to look at the recently released rankings in the Commonwealth Fund’s “Achieving Racial and Ethnic Equity in U.S. Health Care: A Scorecard of State Performance” report.


We would like to thank Paula Braveman, Professor of Family and Community Medicine and Director of the Center on Social Disparities in Health at the University of California, San Francisco (UCSF); Sherry Glied, Dean of New York University’s Robert F. Wagner Graduate School of Public Service and Professor of Public Service; and Thomas Rice, a faculty associate in the UCLA Center for Health Policy Research and a distinguished professor and vice chair of the Department of Health Policy and Management in the UCLA Fielding School of Public Health, for their helpful comments and suggestions.

We would also like to thank Vishaal Pegany, Assistant Secretary at the California Health and Human Services Agency, for his helpful comments and suggestions.

Finally, we are grateful for the editorial assistance of Crystal Haryanto, Undergraduate Research Assistant at the Petris Center at the University of California, Berkeley.


Scheffler R, Shane O. Health Equity: California Style. Milbank Quarterly Opinion. December 2, 2021.

About the Authors

Richard M. Scheffler is a Distinguished Professor of Health Economics and Public Policy at the Graduate School of Public Health and the Goldman School of Public Policy at the University of California, Berkeley. Dr. Scheffler is the director of The Nicholas C. Petris Center on Health Care Markets and Consumer Welfare as well as the director of the Global Center for Health Economics and Policy Research. He has been a visiting professor at the London School of Economics, Charles University in Prague, the University of Pompeu Fabra in Barcelona, and at Carlos III University of Madrid. He has been a visiting scholar at the World Bank, the Rockefeller Foundation in Bellagio, and the Institute of Medicine at the National Academy of Sciences and a consultant for the World Bank, the WHO, and the OECD. Dr. Scheffler has been a Fulbright Scholar at Pontifica Universidad Catolica de Chile in Santiago, Chile, and at Charles University, Prague, Czech Republic. He also served as the president of the International Health Economists Association 4th Congress in 2004. In 2018, Dr. Scheffler was awarded the Berkeley Citation, among the highest honors the campus bestows on its community, presented on behalf of the Chancellor to individuals whose contributions to UC Berkeley go beyond the call of duty and whose achievements exceed the standards of excellence in their fields. In 2019, Dr. Scheffler was appointed by Governor Gavin Newson to the Healthy California for All Commission, charged with developing a plan to guide California toward a unified health care system.

See Full Bio

Olivia Shane is a senior at UC Berkeley, majoring in Public Health and minoring in Data Science. She is currently an undergraduate Research Assistant at the The Nicholas C. Petris Center on Health Care Markets and Consumer Welfare at The UC Berkeley School of Public Health. This summer she worked at Analysis Group, an economic consulting firm, as a Healthcare Analyst and she plans to get her MPH in the near future.

See Full Bio