Oakland Hospital Says Lower Medi-Cal Pay Pushed Service, Job Cuts
On Tuesday, Children's Hospital Oakland announced it will lay off 84 full-time employees, prompting criticism from Alameda County officials for announcing such a major decision so suddenly, the San Francisco Chronicle reports.
The layoffs and the planned reduction of outpatient services are expected to save $10 million annually. The changes to outpatient services include eliminating the hospital's rheumatology program and scaling back its audiology program and an initiative for obese children.
Frank Tiedemann, the hospital's president and CEO, said the primary motivation for the layoffs and changes to outpatient services is a 10% cut to Medi-Cal reimbursements that was scheduled to begin on July 1. Medi-Cal is California's Medicaid program (Fernandez, San Francisco Chronicle, 7/3).
Tiedemann said the hospital is hit with a greater share of the cost of providing services to Medi-Cal beneficiaries each year because of inadequate reimbursements. He said, "If the only thing that we cared about was money, we would have canceled the Medi-Cal contract. We are making some minor adjustments" (Hogarth, East Bay Business Times, 7/1).
Anthony Iton, head of the county public health department, said the service reductions could affect care for children enrolled in Medi-Cal, adding that the sudden announcement of the changes was "inappropriate."
Doctors at the hospital also voiced concerns that some patients would lose access to care (San Francisco Chronicle, 7/3).
Tiedemann said that about 67% of the hospital's patients are covered by Medi-Cal (AP/Stockton Record, 7/2).