Latest Morning Briefing Stories

Medi-Cal Cut Could Force Some Rural Hospitals To Close Nursing Units

Medi-Cal providers are anxiously waiting to see if federal courts uphold a 10% reimbursement cut. Some skilled nursing facilities face even deeper cuts that might be enough to put some rural hospitals out of business.

Healthy Families Savings Goes from $13M to $137K

At a legislative hearing yesterday, state officials said the estimates for savings have been reduced for the Healthy Families transition to Medi-Cal managed care.

According to the Legislative Analyst’s Office, the original estimated general fund savings for the Healthy Families transition was $13.1 million in 2012-13. The estimate has shrunk to $137,000. Savings for next fiscal year — 2013-14 — were estimated at $52 million and that estimate has been revised to $43 million.

Scott Ogus, who represented the Department of Finance at yesterday’s hearing, said there were several factors contributing to the revision. Delays in implementation by the Department of Health Care Services led to caseload changes. DHCS officials have said the department slowed down some of the early phases of the transition so children would have less disruption in continuity of care.

Public Involvement in Managed Care Licensing?

Thirteen bills came before the Assembly Committee on Health yesterday and all 13 were approved, but not all them got a red-carpet reception.

One of the bills that stirred up opposition from health plans was a proposal by Assembly member Roger Dickinson (D-Sacramento) to open the managed care licensing process to public scrutiny and input.

“We know that millions more Californians will attain coverage under the Affordable Care Act, along with millions more in the impending Medi-Cal expansion, and [the effort] to move current enrollees in Healthy Families and other programs into Medi-Cal managed care,” Dickinson said, “making it an opportune time to apply for managed care licensure.”

New Survey Offers First Data on Managed Care Shift

A survey released yesterday revealed strengths and weaknesses in the state’s 2011 transition of about 172,000 seniors and persons with disabilities into Medi-Cal managed care plans.

Two-thirds of the responding beneficiaries said their care was the same or better than it had been before the transition but the survey raised concerns on several fronts, most notably a lower level of notification and communication, according to Carrie Graham, assistant director of research at  Health Research for Action at UC-Berkeley School of Public Health. Health Research for Action conducted the survey in partnership with the California HealthCare Foundation, which publishes California Healthline.

The survey reached 1,521 Medi-Cal-only respondents who transitioned into managed care between June 2011 and April 2012. Graham said there was a 59% response rate to the survey.

Duals Demonstration Gets Green Light

CMS and California health officials yesterday announced they agree on a framework for the launch of the duals demonstration project starting as soon as October.

About 456,000 Californians who are dually eligible for Medicare and Medi-Cal coverage in the eight demonstration counties will be qualified to participate in the duals project.

State officials announced yesterday the project will be launched under the name Cal MediConnect.

Douglas Updates Legislators on Health System Changes

California’s health care system is undergoing its biggest changes in almost 50 years. Toby Douglas, director of the agency at the eye of the health care storm, updated legislators on the progress of some of the changes in a hearing last week in Sacramento.

Access at Issue in Provider Cut

A new Assembly bill would exempt one type of skilled-nursing provider from state-imposed Medi-Cal reimbursement cuts. The 10% reduction is being challenged in federal court and has not taken effect.

The new bill, AB 900 by Assembly member Luis Alejo (D-Salinas), would exempt hospital-based, acute-care skilled nursing facilities from the cut. Other providers could be included in the legislation, but so far the bill deals only one kind of provider.

Hospital-based skilled-nursing facilities were singled out because the cuts will affect them more than other Medi-Cal providers, according to Jan Emerson-Shea, vice president of external affairs for the California Hospital Association.

Concern Over Retroactive Medi-Cal Cut

State lawmakers last week got a reply to their long-held question about a 10% Medi-Cal provider reimbursement rate reduction — and they didn’t much like the answer.

At an Assembly budget subcommittee hearing last week, the testimony turned to what would happen if a federal appeals court rules in favor of the state’s effort to cut Medi-Cal reimbursement rates to providers by 10%.

Assembly member Holly Mitchell (D-Los Angeles) asked the director of the Department of Health Care Services, Toby Douglas, a question that has haunted provider groups facing the large rate reduction.