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Medi-Cal cuts threaten pharmacy access

Community Voices

The Bakersfield Californian | Sunday, May 18 2008 6:05 PM

Last Updated: Sunday, May 18 2008 6:09 PM

Gov. Arnold Schwarzenegger's 10 percent Medi-Cal provider cuts are expected to go into effect on July 1. They will negatively affect the profession of pharmacology and the patients it serves. The governor instituted these cuts as part of the "solution" to California's ever-growing budget deficit.

This solution will have unintended negative consequences that will further inflate California's budget deficit. California's reimbursement rate for Medi-Cal providers is already among the lowest in the nation. These cuts would further amplify the problem. The total cuts on Medi-Cal reimbursement account for $544 million out of the entire $20 billion deficit; however, pharmacy bears nearly a third of these cuts at $172 million.

Through these cuts, pharmacists gets hit twice through the dispensing fee that pharmacists receive for filling the prescription and through a lower reimbursement level on the cost of the drug. In fact, pharmacists will be reimbursed at a lower price than it costs to buy the drug. Essentially, pharmacies will be losing money on every Medi-Cal prescription they fill. This certainly isn't a viable business model.

Pharmacists, or those in any profession for that matter, cannot be expected to provide services at a loss. Yet, that's exactly what the state is asking of the industry. In fact, these cuts are so severe that a wide range of health care organizations filed a lawsuit against California, contending these cuts, among other things, violate state and federal laws (42 C.F.R. §447.204), which essentially says that Medicaid (Medi-Cal) payments must be sufficient to enlist enough providers to ensure that these services are available to recipients.

If the cuts take place, pharmacists will have some tough decisions to make in the days ahead.

Do we stop accepting Medi-Cal and turn away patients in need? Do we continue taking Medi-Cal at a loss until we are forced to close our doors? Do we reduce staffing and business hours, thus resulting in further access issues?

California is home to more than 6.5 million Medi-Cal beneficiaries. By enacting cuts to all providers you would think there would be a huge savings to the state. However, that's not the case. Access issues will become a real problem.

Patients will become sicker, and will need more expensive forms of medical treatment, such as emergency room visits or hospitalizations. These emergency room visits and hospitalizations will cost the state and taxpayers significantly more money.

Can we really afford this during these hard economic times? Even the Legislative Analyst's Office recommended a repeal of the 10 percent cut, saying that "... the proposed reductions might reduce patients' access to care or cause patients to obtain care through other, more costly access points ..."

If pharmacies in rural areas, such as Kern County, close their doors, patients will have to find Medi-Cal-accepting pharmacies that are distances away. And, what about our ethnic communities? They would certainly have a difficult time finding pharmacists that speak their languages.

Many patients rely on their local pharmacist and their Medi-Cal benefits to survive. California cannot afford to pursue a policy that will irreparably harm the health of our children, seniors and the disabled citizens.

The governor and the Legislature need to work on a long-term solution to the budget deficit that doesn't put patients and an entire profession at risk.

Andy Stout is a pharmacist and the owner of El Tejon Drugs in Bakersfield. Community Voices is an expanded commentary that may contain up to 500 words. The Californian reserves the right to reprint commentaries in all formats, including on its Web page.