Legislation Would Require On-Time Medicaid Payments

Sarane Baker-Collins remembers the time well. “We went for months without a [Medi-Cal] payment. We kept doing our work, and the state didn’t pay us for months. It’s almost criminal what the state did to us.”

Baker-Collins runs three small homes for residents with developmental disabilities in Santa Rosa. In the wake of the budget impasse of 2008, California had to shut off payments to Baker-Collins and other health care providers until a budget could be agreed upon.

Some Medi-Cal providers went as long as 60 days without reimbursement. For a small not-for-profit on a thin margin like the one run by Baker-Collins, that’s a cost hard to bear.

“We don’t have much of a margin,” Baker-Collins said. Basically all we had was credit cards for credit. I had four of them at the time. We were backed by my credit, and by my mom’s credit. If we didn’t have that, we would’ve gone out of business.”

That kind of delay in payment ends up putting health care services in jeopardy for many Californians, according to Deborah Pacyna of the California Association of Health Facilities.

“It becomes an access issue,” Pacyna said. “There aren’t many other places for these patients to go. And it’s just not right to ask these small nonprofits to pick up the slack.”

CAHF is pushing national legislation to change that. U.S. House members Anna Eshoo (D-Palo Alto) and Brian Bilbray (R-San Diego) have proposed legislation called the Fair Pay to Medicaid Providers Act (HR 3587), which would require Medicaid (Medi-Cal in California) to reimburse all providers in a timely manner. Currently, physicians do have that guarantee, but not other health care providers.

Under the American Recovery and Reinvestment Act, hospitals and nursing homes received that guarantee of prompt payment — but when enhanced Federal Medical Assistance Percentage ran out in July of last year, that guarantee went with it, Pacyna said. She pointed out that the state budget has only been signed on time five times in the past 16 years, so this funding uncertainty is something Baker-Collins and other providers deal with constantly.

“We say that I’m the major bailer of the sinking ship,” Baker-Collins said. “Up at the state level, they argue and fight over the budget way past the deadline, but they never think about what that does to the people, how it affects people. I guess I feel like, if we’re willing to do the work to take care of these [severely disabled] people, then the people up in Sacramento should do their part, too.”