Medi-Cal cuts could snip safety net for poor
By Barbara Anderson The Fresno Bee
Saturday, Oct. 29, 2011 | 10:27 PM
California got federal permission last week to cut Medi-Cal payments, a decision that doctors and pharmacists say will make it harder for thousands of low-income residents in the central San Joaquin Valley to get care.
The Obama administration's decision to allow a 10% cut in reimbursements to doctors, pharmacists and hospitals could save the cash-strapped state millions.
State officials say they were careful to preserve access to care. But health-care providers disagree, saying
California's reimbursements already are the lowest, and payment reductions will unravel an already torn safety net for the poor. Impoverished and rural areas, such as in the Valley, would suffer the most, they say.
"We are most worried about our rural pharmacists because they serve a higher proportion of Medi-Cal patients. And they do not have the large corporate structure to spread out those costs," said Jon Roth, chief executive officer of the California Pharmacists Association.
Roth said Friday he had fielded at least 25 calls from pharmacists in the state. Many told him they would have to close their doors or stop seeing Medi-Cal patients, he said.
The Obama administration's decision to allow a 10% cut in reimbursements to doctors, pharmacists and hospitals could save the cash-strapped state millions.
State officials say they were careful to preserve access to care. But health-care providers disagree, saying
California's reimbursements already are the lowest, and payment reductions will unravel an already torn safety net for the poor. Impoverished and rural areas, such as in the Valley, would suffer the most, they say.
"We are most worried about our rural pharmacists because they serve a higher proportion of Medi-Cal patients. And they do not have the large corporate structure to spread out those costs," said Jon Roth, chief executive officer of the California Pharmacists Association.
Roth said Friday he had fielded at least 25 calls from pharmacists in the state. Many told him they would have to close their doors or stop seeing Medi-Cal patients, he said.
About 637,000 Valley residents rely on Medi-Cal, the state's version of Medicaid, for their health care. Often, Medi-Cal is the biggest insurer. In Tulare County, for example, more than 35% are enrolled, and in Fresno County, more than 30% are Medi-Cal recipients.
In Firebaugh, many of Dr. Oscar Sablan's patients have Medi-Cal. With provider pay cuts, appointments for patients who need care from specialists will be harder to get, he said. "I think this is going to be the last straw for the different sub-specialists to accept Medi-Cal referrals from primary-care physicians," he said.
The cuts most certainly will be challenged in court. Health-care providers have been successful at blocking rate reductions. And a challenge to pay cuts in 2008 and 2009 is before the U.S. Supreme Court. The case will decide if medical professionals have a right to sue under the Constitution.
A Supreme Court decision, however, isn't expected before spring. In the meantime, providers such as the California Medical Association say litigation may be the only option to stop the new cuts.
The state said it's confident the latest cuts will stand up in court.
"We don't see any reason why a court would enjoin or prevent us from implementing reductions that have followed all federal rules," said Toby Douglas, director of the California Department of Health Care Services.
The state looked at availability to providers by speciality type and geography, Douglas said. "We determined where we could make reductions and where it was not advisable to make reductions," he said.
The department also plans to monitor access, Douglas said. If access drops, the state could take steps to rectify it, including modifying the payment reductions or eliminating the cuts, he said.
But health officials in poverty-stricken counties with doctor shortages say provider cuts will push more people into hospital emergency departments.
As people have lost jobs in the sputtering economy, Kaweah Delta Hospital in Visalia has seen more people with Medi-Cal or no insurance, said Lindsay Mann, chief executive officer at Kaweah Delta Health Care District. His hospital's charity-care burden (care delivered without reimbursement) will be $29 million, Mann said. In 2008, it was $13 million.
The doctor provider cuts have Mann worried. Because fewer doctors will accept Medi-Cal, more patients will show up at Kaweah Delta's emergency department. And every time the hospital admits a Medi-Cal emergency patient, it has to subsidize the care by 8%, he said.
The hospital's already busy emergency department also will be busier, making it harder to get people in and out in a timely manner.
The emergency department had 82,000 patients visit last year, Mann said. "I anticipate we'll see another 2,400 visits per year in the emergency department based on the reductions."
Douglas of state Health Services said decisions to reduce provider payments were made carefully. The state withdrew a request to cut provider payments for children's and home health care because of concerns about the affect on access, he said.
California had estimated Medi-Cal payment cuts would save the state's general fund $623 million. With children and home health services carved out, it will be less than that, Douglas said. The state should have a new estimate soon, he said.
The decision to not cut provider rates for children and home health services is commendable, said Norma Forbes, executive director of Fresno Healthy Community Access Partners, a non-profit organization working to improve health access in the Valley.
But Forbes said Valley residents will have a harder time finding doctors willing to see them.
"In reality, access to Medi-Cal providers in the communities in the Valley most likely will decline. It's inadequate currently, and this will make it worse."
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