Medi-Cal Provider Reimbursements To Decrease in 2006
The administration of Gov. Arnold Schwarzenegger (R) on Monday announced in a mailed bulletin to health care providers that it will temporarily reduce Medi-Cal reimbursement rates by 5% through 2006, the Los Angeles Times reports.
The Legislature under Gov. Gray Davis (D) approved the rate cut, but legal challenges prevented its implementation. The state faced a projected $38-billion budget shortfall when the reduction was approved.
Some Democrats are questioning the need for the reduction after an unexpected revenue surplus this year will allow the state to balance the budget next year.
Schwarzenegger administration officials say the rate reductions are necessary to keep the state budget in balance. Officials said the governor will not demand back payments from providers for the years the reduction was delayed in court.
Officials also said that they would consider alternatives to the rate reduction, which is expected to save the state about $60 million, but that no feasible solutions have been suggested.
California Medical Association officials said they will work with the administration to develop an alternative to the cut, which could include rule changes to reduce the number of tests for Medi-Cal patients for which a physician could be reimbursed. CMA also launched an e-mail campaign to members on Monday protesting the rate cut (Halper, Los Angeles Times, 12/13).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.