Key Newsom Advisor Abandons Healthcare Initiative Amid Infighting

By: David Donovan | Published: Jun 14, 2024

During tense discussions about the November ballot and state budget, California Gov. Gavin Newsom’s growing dissatisfaction with a proposed ballot initiative sponsored by leading healthcare groups is spilling out into the public.

POLITICO received confirmation on Thursday from Jim DeBoo, a prominent Sacramento consultant and former chief of staff to Newsom, that he has resigned from his leadership position in the campaign to use a tax on some health insurance to fund Medi-Cal enhancements.

MCO Tax Measure

The MCO tax measure, as it’s known, is a significant priority for doctors, hospitals, Planned Parenthood, and health insurers. 

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Prevention Park, is the largest Planned Parenthood administrative and medical facility in the nation. It also serves as the headquarters for 12 clinics, located in Houston, Texas

Wikimedia Commons user Hourick

Newsom has proposed utilizing cash from the tax to cover the state’s vast spending plan shortfall. 

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Doctor Salary Increase

The related ballot measure, on the other hand, would mandate that the money be used to raise doctor salaries in Medi-Cal, the state’s Medicaid health care program.

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Doctor woman with a white coat and stethoscope.

Unsplash user JESHOOTS.COM

The coalition supporting the ballot measure is upset with Newsom for not sticking to the budget agreement from last year, which would have kept the money secure. 

Internal Conflict

Additionally, these bitter feelings have spilled over into the ballot fight, where supporters of the measure are concerned that Newsom’s personal issues with the initiative will turn into outright opposition.

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Jim DeBoo with Gavin Newsom and family posing with a bear statue in a corridor

X user JimDeBoo

DeBoo emphasized that he did not want to be associated with a proposal that Newsom has expressed concerns about which is cutting ties between close political allies and even personal friends.

An Act of Loyalty

DeBoo stated that he took the action out of loyalty to the governor and his staff, pointing out that he had been in the negotiating position as the chief of staff and is still very close to Newsom and his top advisers.

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Jim DeBoo with family and a friend outdoors in front of a row of houses

X user JimDeBoo

DeBoo stated in a text message, “My agreement with the coalition from last March was always [that] if the Administration and coalition couldn’t reach an agreement, I wouldn’t continue working on the measure.”

Newsom’s Inner Circle

DeBoo and others in Newsom’s internal circle were maddened by reports — including a post for social media late Wednesday, that the governor constrained DeBoo to step away. 

Jarrod McNaughton posing with young adults in front of a blue wall.

X user JarrodMcNaug

DeBoo responded to Inland Empire Health Plan CEO Jarrod McNaughton’s claim that Newsom forced him to resign by stating that his reasons were entirely his own decision.

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DeBoo’s Response

DeBoo stated, “The accusation from someone I’ve never met that the Governor forced me to do anything is offensive to me as a professional.”

Brandon Castillo posing for a photo with the back of a woman's head in the foreground

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Another top Sacramento expert on ballot measures, Brandon Castillo, who coalition members claimed had been working with DeBoo, is taking over the campaign.

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Departure Significance

The significance of DeBoo’s departure was downplayed by Dustin Corcoran, CEO of the California Medical Association and leader of the ballot initiative coalition, who attributed it to a staffing issue.

CMA conference with a speaker at a podium and four people sitting in chairs on stage

CMAdocs

“We’re moving into the last phase of this which is a distinct and particular part of the campaign and it makes sense for there to be one clear general consultant,” Corcoran stated.

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Corcoran’s View

According to Corcoran, there is “no daylight” between the coalition’s and Newsom’s objectives for enhancing Medi-Cal; the only difference is how they will get there.

McNaughton posing for a picture with four young women in a lobby

X user JarrodMcNaug

Regardless, he stated that Newsom is not attempting to force anyone to leave contrary to McNaughton’s claim.

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Corcoran added, “He never made any commitment to support the ballot measure, so he hasn’t broken any promises or commitments at all.”

Newsom with two doctors posing in front of a US flag and California flag

X user CMAdocs

Many members of the close-knit Capitol political community have been taken aback by the standoff between the governor and some of his closest allies in Sacramento. 

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Newsom’s Advisers

A spokesperson for the MCO ballot measure is Anthony York, a former senior adviser in Newsom’s office.

Akilah Weber posing with three other people holding degrees

X user asmakilahweber

Meanwhile, Akilah Weber, the chair of the Assembly’s health budget subcommittee told Playbook that she “was shocked by the governor’s new proposal on the MCO tax.”

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Change of Plan

The additional $7 billion from the state’s latest tax on some health plans was earmarked for raises in the pay for healthcare workers.

Newsom shaking hands with an elderly man while his wife stands next to him

X user GavinNewsom

Last year a $19 billion package to improve Medi-Cal was created by some of California’s biggest health industry players.

As Newsom is facing criticism for recent legislation regarding the increase in the minimum wage this latest schism is sure to increase pressure on the governor.

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