Legislators Continue Work on Legislation To Implement Medi-Cal Funding Agreement
Legislators have until the end of the week to write and pass a bill that would restructure distribution of Medi-Cal funds to hospitals and possibly shift beneficiaries to managed care plans as part of an agreement that Gov. Arnold Schwarzenegger (R) made with the federal government, the Sacramento Bee reports.
According to the Bee, lawmakers are drafting legislation that would put in place Schwarzenegger's proposal to shift more than 500,000 beneficiaries to managed care plans. However, lawmakers and hospital officials are still debating the best way to restructure Medi-Cal funding to hospitals, the Bee reports.
Lawmakers and hospital officials expect to have draft legislation written by Tuesday -- just three days before the end of the legislative session (Benson, Sacramento Bee, 9/3).
Under the agreement, which Schwarzenegger announced on June 22, federal matching funds for Medi-Cal would be increased by as much as $3.3 billion over five years.
The federal government would provide the state with an additional $671 million annually for Medi-Cal over five years, with $360 million of those funds allocated for the shift of low-income beneficiaries to managed care plans. According to state officials, Medi-Cal would shift 554,000 elderly, blind and disabled beneficiaries to managed care plans between January 2007 and mid-2008 under the agreement (California Healthline, 8/22).
The state could lose $180 million of the proposed federal funding if it does not pass a plan to shift beneficiaries to managed care (Sacramento Bee, 9/3).
In addition, California would receive a five-year waiver from federal rules related to Medi-Cal hospital reimbursements. The waiver would allow the state to continue to contract with 230 hospitals for Medi-Cal services, rather than pay the 600 hospitals statewide (California Healthline, 8/22).
Hospital officials and county governments have expressed concern that the Bush administration's proposals to restructure hospital reimbursements to control Medicaid spending will limit funding to public hospitals. Under the new policies, hospitals are required to spend money directly on Medi-Cal before they can qualify for federally matched funding.
Some hospital officials are asking lawmakers to draft separate bills for the restructuring of hospital funding and the enrollment of beneficiaries in managed care. They say the measures should be approved separately to prevent hospital funding from becoming tied up in legislative debates over managed care (Sacramento Bee, 9/3).