Expected Lawsuit Seeks To Block Cuts to Medi-Cal Provider Pay
San Francisco Mayor Gavin Newsom (D) is expected to announce today that a coalition of local governments and health care providers plan to file a lawsuit seeking to roll back a 10% reduction in Medi-Cal payments to providers that the Legislature approved in February, the Los Angeles Times reports. Medi-Cal is California's Medicaid program.
The rate reduction will not take effect until summer, but doctors already have started dropping out of Medi-Cal, explaining that reimbursements from the program no longer cover the cost of care.
Warning of such a move, the Legislative Analyst's Office said the budget cuts would push more people to seek treatment in hospital emergency departments, where it is far more expensive to deliver care.
In addition, the state would lose hundreds of millions of dollars in matching federal funds for Medi-Cal.
State officials say the cuts will save the state more than $500 million annually, but health care experts argue that other costs to taxpayers will increase by more than what the state will save in Medi-Cal reimbursements.
Sandra Shewry -- director of the Department of Health Care Services, which administers Medi-Cal -- said, "This is not being done lightly," adding, "It is not a preferred policy direction so much as responsible management given the resources of the state."
Officials for Gov. Schwarzenegger's administration said the move is not a long-range solution but defended it as a better option than dropping hundreds of thousands of beneficiaries from the program and limiting services that the program covers (Halper, Los Angeles Times, 3/24).
If the cuts continue into the next fiscal year, the San Francisco Department of Public Health could lose about $9 million in revenue, Jim Soos, assistant director of policy and planning for the department, said.
San Francisco's universal health access program, Healthy San Francisco, also would be indirectly affected by the cuts because the lost revenue would limit enrollment in the program, Soos said (Smith, San Francisco Examiner, 3/25).
Beyond doctors opting out of the program, Medi-Cal also is being hit with delays in approving some services, the Sacramento Bee reports.
Stan Rosenstein, chief deputy director of DHCS, said that the program aims to approve treatment requests within a day but that a high demand for services has resulted in delays of up to 10 days in some cases.
He said, "We have an obligation to do the best we can to manage this workload with the resources we have" (Griffith, Sacramento Bee, 3/23).
KPCC's "Patt Morrison" on Monday featured a discussion about physicians opting out of Medi-Cal because of declining reimbursement rates. The segment includes comments from:
- Allison Diamant, associate professor of medicine at UCLA; and
- Dylan Roby, a research scientist at the UCLA Center for Health Policy Research (Morrison, "Patt Morrison," KPCC, 3/24).