On Tuesday, thousands of California doctors, nurses, hospital representatives, patient advocates, and Medicaid beneficiaries stormed the state Capitol to protest Gov. Jerry Brown’s (D) proposed cuts to the health entitlement program for the poor. Brown included cuts of up to 10 percent for Medi-Cal providers’ reimbursement rates in his most recent budget.
Providers sued to prevent the cuts from taking place, but were denied a full hearing by a federal appellate court in May. Unless plaintiffs appeal the issue to the U.S. Supreme Court, the provider cuts will likely begin taking effect sometime this summer.
Critics warn that the lower provider payments could be devastating to clinics and hospitals that service poor or uninsured Californians — despite extra federal funding that the state will receive for expanding its Medicaid pool under Obamacare.
“We are trying to expand access to care under the Affordable Care Act, when they are trying to cut reimbursement for Medi-Cal providers, which is already pathetic,” Mary Ellinger, executive director of the Tuolomne County Medical Society, told the Sacramento Bee. “We are the biggest state, with the biggest population, and the lowest reimbursement rate. It’s going to be very hard to sustain the cuts.” Ellinger has fought to keep her local clinics open in the face of low Medi-Cal reimbursement rates and the additional planned cuts.
In California, some residents — particularly Spanish-speaking immigrants — have to resort to underground, cash-only “clinica bodegas” in order to get medical treatment due to the state’s dearth of primary care physicians in poor communities. These clinics provide services to both legal and undocumented immigrants, no-questions-asked — but have very little regulatory oversight. If low Medicaid reimbursements force more medical clinics to shut down, poor Californians may have to choose between forgoing care, an expensive emergency room visit, or using alternative facilities such as the clinicas.
Brown’s Medi-Cal cuts reflect his dogged pursuit of putting California on sounder fiscal ground after years of runaway deficits. Through a combination of tax increases and cuts to education and other public services, Brown led California from a $60 billion budget deficit three years ago to an over $1 billion dollar surplus this year.
With that extra money in hand, Brown has eased — and even reversed — the austerity measures for education and the Golden State court system.
Health care appears to be one area that the governor is still willing to scrape away at in a cautious effort to guard the state’s new-found fiscal security. Brown proposed denying Californians who would newly gain Medicaid coverage under Obamacare’s expansion of the program all of the benefits afforded to current beneficiaries — a position he has since reversed.
He has also asked community clinics to return $300 million in funding to the state to help pay for the Medicaid expansion. Although Brown argues the clinics won’t need that money once more uninsured Californians gain access to Medi-Cal under Obamacare, providers aren’t so sure.
By slashing California’s already-low reimbursements even further, Brown is forcing Medi-Cal providers in the state to choose between shutting down, or continuing to serve their patients while being paid a pittance. The former could lead to worsened health and higher medical costs for poor Americans; the latter could discourage clinics who would otherwise want to help implement the Medicaid expansion from following through.