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Proposed Changes in Medicaid Rules Could Cost California Millions in Federal Funding

In a California Healthline Special Report, state and federal officials, a hospital industry representative, and an attorney for a patient advocacy group discussed how proposed changes to Medicaid regulations could affect funding and delivery of health care in California.

Medi-Cal, California’s version of Medicaid, could lose as much as $1 billion annually if the changes are fully implemented.

The Special Report includes comments from:

  • Dan Brzovic, an associate managing attorney at Protection and Advocacy;
  • Stan Rosenstein, director of Medi-Cal;
  • Dennis Smith, director of the Center for Medicaid and State Operations at CMS; and
  • Melissa Stafford Jones, president and CEO of the California Association of Public Hospitals.

Smith said the regulations are needed to reign in states that are using inappropriate accounting and budgeting procedures to milk more federal matching funds for their Medicaid programs.

“It’s a vitally important program but should not be used simply as an open-ended bank account for other programs,” Smith said.

One proposed change would cut Medicaid funding for training of new physicians.

Stafford Jones said public hospitals would lose $86 million for physician training, adding, “And since half of California’s new physicians are trained in public hospitals, clearly, this would have an impact, not only within public hospitals, but a ripple effect into the entire health care community” (Rebillot, California Healthline, 12/10).

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Audio Report Insight Insurance Medi-Cal The Health Law