Hospital Officials Voice Skepticism About Federal Medi-Cal Agreement
Gov. Arnold Schwarzenegger's (R) agreement with federal Medicaid officials to rework the Medi-Cal program "could leave many hospitals critically short of cash," according to hospital officials who attended a legislative hearing on Wednesday, the Stockton Record reports. There are "many unanswered questions" about the details of the plan, and "both hospitals and counties fear the worst," according to the Record (Stockton Record, 7/14).
The Schwarzenegger administration on June 22 announced an agreement with the federal government that would increase federal matching funds for Medi-Cal by as much as $3.3 billion over five years and enroll about 500,000 beneficiaries in managed care plans.
Under the plan, California would receive a five-year waiver from federal rules regarding hospital payments for Medi-Cal. The waiver would allow the state to continue contracting with 230 hospitals for Medi-Cal services, rather than pay the 600 hospitals statewide. State officials say the agreement would save California money and help it to comply with federal accounting requirements.
The federal government would provide the state with an additional $671 million annually for the program over five years. Of that money, $360 million has been earmarked to shift low-income beneficiaries to managed care plans. According to state officials, 554,000 elderly, blind and disabled state residents would be moved to managed care plans between January 2007 and mid-2008 under the plan.
The plan to shift beneficiaries to managed care plans is similar to a Schwarzenegger proposal that the Legislature rejected in May, saying that HMOs in some areas are not prepared to accept additional members (California Healthline, 6/23).
"Time is running short to ratify the deal," the Record reports. Lawmakers must approve the plan before the legislative session ends on Sept. 9. The Legislature begins a month long recess on Friday, meaning that it will have less than three weeks to consider the plan when it reconvenes (Stockton Record, 7/14).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.