Senate Budget Committee OKs Medi-Cal Reimbursement Cuts

On Wednesday, the Senate Budget Committee approved a 10% cut in Medi-Cal reimbursements to doctors and hospitals as part of a package of emergency spending cuts to rein in a growing budget deficit, the Sacramento Bee reports.

Medi-Cal is California's Medicaid program (Lin, Sacramento Bee, 2/14).

The $1 billion in spending cuts to health, education and other services are intended to help reduce a $14.5 billion state budget deficit over the next 18 months (Halper, Los Angeles Times, 2/14).

Gov. Arnold Schwarzenegger (R) declared a fiscal emergency on Jan. 10 and proposed $800 million in cuts to the current fiscal year's budget, giving lawmakers until Feb. 23 to act (Sacramento Bee, 2/14).

Lawmakers also plan to make additional cuts in coming months as they negotiate the rest of the FY 2008-2009 budget.

According to the Times, those cuts likely will be influenced by a report next week by the Legislative Analyst's Office that is expected to reveal a significant increase to the deficit, perhaps by billions of dollars (Los Angeles Times, 2/14).

The reduced Medi-Cal reimbursement rates would cut about $577 million from the program, the Times reports (Los Angeles Times, 2/14).

The committee agreed to $1.2 billion in savings in the FY 2008-2009 budget by reducing and delaying reimbursements.

Lisa Folberg of the California Medical Association noted that California would lose twice as much as it cuts in state spending for Medi-Cal because of a loss of federal matching funds.

Folberg argued that the cuts will reduce "access to care from physicians and specialists ... including longer waiting times in the emergency [departments] for patients" (Sacramento Bee, 2/14).

The Senate committee passed the spending cuts without any votes from Republicans, who said they did not have sufficient time to review the package (Sacramento Bee, 2/14).

Committee Vice Chair Dennis Hollingsworth (R-Murrieta) said the package should include additional cuts but added that Republicans likely will vote for the reductions when they are considered by the full Senate.

An Assembly committee is expected to approve the cuts on Thursday, and a vote from the full Legislature could happen as early as Friday (Los Angeles Times, 2/14).