Health care column: Understanding Medi-Cal a headache
| Tuesday, Jun 30 2009 07:38 PM
Last Updated Tuesday, Jun 30 2009 07:38 PM
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Finally. Someone out there understands us. Or at least, somebody empathizes with our confusion over what’s going on with Medi-Cal and state budget talks.
All we wanted to know was how Medi-Cal cuts proposed by the Schwarzenegger administration would affect Kern’s health-care industry. The consensus seems to be — and we’re paraphrasing here — “Have a seat. This is going to take a while.”
Or, as explained by one brave soul who tried to put the answer into e-mail form: “If you are confused, you probably understand the situation quite well.” (That’s from Kern Medical Center CEO Paul Hensler.) Validation!
Medi-Cal, so you know, funds the medical care of 208,602 Kern County residents, or about 3 percent of California’s program beneficiaries, according to the state. It says the county has 2,345 Medi-Cal providers, which is 1.6 percent of the state total.
As near as we can tell, Schwarzenegger’s number crunchers were working on a multi-pronged approach to saving Medi-Cal money. Note the word “were”: When this was being written in mid-June, budget proposals were coming and going daily.
It appeared as though the governor’s much-bemoaned plan to eliminate the Healthy Families program, which insures children of some working adults, was halfway out the window. A key legislative panel moved June 15 merely to scale back the program and hope private donors would cover the rest.
That’s important because doctors get paid a “reasonable amount” for rendering services under Healthy Families, a spokesman for the California Medical Association said. Also, fewer people with health insurance increases chances that someone will show up in an emergency room looking for free services, a situation that makes it hard for hospitals to stay in business.
Then there’s the matter of Schwarzenegger’s request for federal flexibility on Medi-Cal. His May 18 letter to the White House states that the governor would like to tighten eligibility restrictions as a means of saving as much as $1 billion, but that he was unable to do so because of existing federal guidelines.
The CMA spokesman, Andrew LaMar, said President Obama is unlikely to approve the flexibility, which would seem to run counter to his push for universal health coverage.
But when we asked for the state’s Plan B, Toby Douglas, the state’s chief deputy director of health care programs for the Department of Health Care Services, said: “At this point we’re focusing on federal flexibilities.” Whoops — sorry we asked.
Other Medi-Cal cuts may be more likely. Douglas said that, starting this month, adult Medi-Cal beneficiaries soon will be ineligible for the following services: dental, podiatry and chiropractic.
On top of that (and here’s where our eyes really start to glaze over), the Medi-Cal program is reducing rates paid to:
• physicians, dentists, pharmacists, optometrists, adult health-care centers and clinics, by 1 percent;
• pharmacies (for services other than prescription drugs and durable medical equipment), by 5 percent;
• non-contract hospitals providing inpatient services, by 10 percent.
That may look clear, except that some rate cuts approved last year for some of the same provider categories — including a 10 percent cut in payments to doctors and hospitals — have been held up in court. Is this all headed for the lawyers’ offices?
If all the proposed cuts go through, LaMar said Kern could feel a disproportionately heavy impact, given our low per-capita physician population and relatively high number of Medi-Cal beneficiaries.
Oh, and just in case you’re able to follow all of this so far, consider the situation of Hensler, who was trying hard to turn a profit at KMC by June 30.
In a June 15 e-mail, Hensler noted that the hospital had just gotten a boost to its Medi-Cal rates, good for two years and retroactive to Oct. 1, thanks to the federal stimulus package.
KMC also received an increase in its Medi-Cal managed care rates, the e-mail said. That’s because although the state decided not to pay its half of the maximum federal Medicaid allowance, the hospital was able to front some of the state’s share, which amounted to several million dollars. This allowed KMC to maximize its reimbursements, for a net additional $8.1 million, which Hensler called a “permanent increase.”
“Much of the confusion is due to the feds increasing payments to providers to help offset some of the loss caused by the economy while the state is decreasing payments due to their fiscal crisis also caused by the economy,” Hensler wrote.
Somehow it’s beginning to make sense.
