Medi-Cal Rate Cuts Could Hit This Summer

Sacramento Business Journal by Kathy Robertson –

June 5, 2013:

As health care providers rallied in protest at the Capitol on Tuesday, officials said Gov. Jerry Brown’s proposed cuts to the Medi-Cal program could start this summer.

The cuts will start at $917 million for fiscal year 2013-2014 and grow to $1.4 billion a year later. But these figures include both state and federal matching funds, cautions H.D. Palmer, a spokesman for the California Department of Finance. Actual savings to the state general fund in ongoing cuts and retroactive collections are projected to total $458.8 million in fiscal 2013-14.

Exactly when the cuts will be implemented — barring an appeal by critics to U.S. Supreme Court or approval of legislation to stop them — is unclear. The state assumed a favorable ruling in the courts, but not so soon. In May, a federal appeals court denied a request by California providers to have a full panel of judges rehear their lawsuit to block the cuts, leaving the U.S. Supreme Court as the only avenue for further appeal.

“It won’t be July 1,” that cuts could be made, Palmer said. ”Perhaps late summer.”

The rate cuts are up to 10 percent, not a flat 10 percent, Palmer added, and not all providers are included. If a rate cut is deemed a potential barrier to access to care, state health officials have authority to scale it back or withdraw it entirely.

The California Department of Health Care Services has proposed exemptions for three provider groups due to access issues; two have been approved by the federal government, while the third is under review, department spokesman Tony Cava said.

In addition, the agency recently withdrew a proposed cut to rates at freestanding pediatric subacute facilities when it was determined that access would be harmed.

Source: John & Rusty Report via Choice Admin