Schwarzenegger Calls for Elimination of Some Health-Related Proposals in Federal Budget Package
Gov. Arnold Schwarzenegger (R) on Monday in a letter to the California Congressional Delegation wrote that some proposals included in the federal House Budget Reconciliation package -- including some related to Medicaid funding -- would "disproportionately impact California" and should be revised or eliminated.
According to the letter, the proposals would:
- Eliminate a Medicaid managed care provider tax, a change that would "shift costs from the federal government to California by reducing federal Medicaid funding" to the state by $175 million annually. Schwarzenegger said he supports a Senate version of the bill that would allow California to retain the tax.
- Require hospitals to "accept as payment in full the state Medicaid fee-for-service rate for services provided out-of-network." Schwarzenegger said the state's current system, which "requires negotiated hospital rates to remain confidential," has maintained California's system for reimbursing safety net hospitals.
- "[E]ssentially require states to maintain open formularies for antipsychotic and single source antidepressants." Schwarzenegger writes that the provision will "single out" California and cost the state "$25 million more annually for these drugs," in addition to the "loss of $25 million per year in lost rebates, which increases costs for the federal government as well."
- Limit federal Medicaid reimbursement for targeted case management services. The proposal would "cause critical implementation problems in California," Schwarzenegger stated (Office of the Governor release, 11/8).