Medi-Cal patients could be charged a fee to fill a prescription, see a doctor and go to the hospital under changes the state is asking the federal government to approve this year.
The proposed rules — which also include caps on doctor visits and a 10% cut to doctors’ pay — come as more residents than ever rely on the state-federal insurance program for the poor.
Medi-Cal co-payments and limits on doctor visits would have a bigger effect in Valley counties than elsewhere in the state: In Tulare County, 35.6% of people were enrolled in Medi-Cal in 2009, the highest rate in the state, according to the latest figures available. Fresno County’s rate at 31.3% was the second highest. More than 600,000 low-income Valley residents were enrolled.
Many on the program are low-wage workers and their families who are without employer-provided health insurance. Others are disabled adults, seniors and pregnant women.
The state wants them to pay a share of the costs for services: $5 for doctor visits, $3 to $5 for prescriptions, $50 for non-emergency visits to the emergency room and $100 a day for a hospital stay, up to a $200 maximum. Doctor visits would be limited to seven per year unless a doctor certifies more.
State officials say the changes to Medi-Cal are necessary to help balance California’s budget: Medi-Cal draws more from general-fund dollars than any program except education.
Health professionals say the changes will result in higher health-care costs. Patients will delay care and be seriously ill before seeing doctors, they say. And cutting doctors’ pay will drive more primary-care doctors to drop Medi-Cal, leaving patients with only emergency rooms for care, they say.
Medi-Cal recipient Kelly Raley, 49, of Fresno said paying for food and rent takes most of the $800 a month she receives in disability income for a severe hearing loss and physical disability. “I can’t even buy hearing-aid batteries,” she said.
Recently, Raley waited to see a doctor at Clinica Sierra Vista on Elm Avenue. A dislocated hip was causing her pain. She sees a doctor at least a dozen times a year and takes 10 medications for asthma and other health conditions. She would have to skip doctor visits and not fill prescriptions to avoid co-payments, she said. “I’d probably just try to suffer it out.”
Difficult choices
California’s proposals for cutting Medi-Cal, the state’s version of Medicaid, are not revolutionary. Across the country, cash-strapped states are trimming costs.
According to a survey by the National Association of Budget Officers, 24 states either are planning or already have reduced provider rates in fiscal year 2011, and 33 states propose to reduce rates for fiscal year 2012.
Toby J. Douglas, director of the California Department of Health Care Services, said the proposed Medi-Cal cuts reflect the state’s need for immediate savings.
“These are really tough actions and really focus on the enormity of the current budget situation and what we face in this current environment,” Douglas said.
More than 7 million Californians depend on Medi-Cal. The $46 billion insurance program includes $14.7 billion in state general funds — or 16.7% of the total $88 billion state fund. Savings from co-payments would be about $511 million. The 10% cut to providers would be another $614 million in savings.
Changes to the Medi-Cal program must be approved by the federal Centers for Medicare and Medicaid Services. California plans by Thursday, which is the end of the fiscal year, to submit a plan for provider rate reductions and limiting doctor visits. The state submitted a waiver request for co-payments this month. If approved, the cut in provider reimbursement would be retroactive to June 1, Douglas said. Patient co-payments would take effect later.
The state recognizes co-payments will affect Medi-Cal beneficiaries, Douglas said. “But we needed to make sure there was shared participation in the cost of services.”
Health experts say delays in care will be common under a system of co-payments and limitations on doctor visits.
History has proven rationing care doesn’t work, said Stephen Schilling, executive officer with Clinica Sierra Vista, which operates the Elm Avenue community health center among others in Bakersfield and Fresno.
California tried limiting doctor visits years ago, Schilling said. “Each Medi-Cal card came with sticky coupons — labels you pulled off. You had so many labels and so many visits per month,” he said.
“All that ever did was defer a few people,” Schilling said. “It resulted in a ton of extra work for the provider community, and I’m guessing for the state. And it didn’t hold back over-utilization and slow costs.”
The co-payment burden
Doctors, pharmacists, dentists and hospitals would be expected to collect co-payments from Medi-Cal patients under the plan.
The co-payments, while small in comparison to what people with private insurance pay, will mostly go unpaid, providers said. And uncollected co-payments will increase the bad debt doctors and hospitals already carry to care for low-income patients, they said.
Kaweah Delta Health Care District in Visalia would have to write off millions in uncollected co-payments, said Gary Herbst, senior vice president and chief financial officer.
Medi-Cal patients had about 33,000 emergency-room visits and 6,600 admissions this fiscal year, he said. Co-payments for all those visits would have been almost $3 million.
Community Medical Centers, the region’s biggest provider of Medi-Cal services, estimates uncollected co-payments at outpatient clinics, the downtown Fresno regional trauma center and Clovis Community Medical Center would be about $4 million or more a year.
“All the state is doing is shifting the burden to the hospitals, and we’re going to recognize it as bad debt,” said Stephen Walter, senior vice president and chief financial officer at Community Medical Centers.
Douglas hopes providers will continue to participate in Medi-Cal, but the state anticipates a fight over the proposed pay cut.
Providers successfully stopped the state’s attempt to cut reimbursement rates by 10% in 2008, and they are determined to block a cut again.
Doctors argue California’s reimbursement rate — $24 for a doctor’s office visit — ranks among the lowest among the states, and many physicians already refuse to participate in the program.
A 10% cut in reimbursement would further reduce patient access to care, said Elizabeth McNeil, vice president of federal government relations for the California Medical Association. “Even more doctors will get out of the program,” she said.
The medical association is among a group of provider organizations that belong to the California Alliance for Patient Care, which is advocating for denial of the proposed Medi-Cal changes.
The alliance said a lack of access to Medi-Cal doctors contributes to overcrowded emergency departments, and overcrowding would be made worse by the state’s Medi-Cal plans.
One-third of all emergency department visits are Medi-Cal patients, while 18% are the uninsured, the alliance said. By law, hospital emergency departments cannot refuse treatment to anyone, regardless of their insurance status or ability to pay.
Many of the Medi-Cal patients in emergency rooms have conditions that could have been prevented or treated in doctor offices, McNeil said.
Raley, the Fresno Medi-Cal patient, went to the emergency room twice last year. She had acute bronchitis, but she couldn’t get in to see her doctor, she said.
Oscar Sablan, a Firebaugh family physician who accepts Medi-Cal, said he tries to keep patients out of emergency rooms when possible, but it can take six months to get an appointment in some specialities. A doctor shortage in the Valley compounds the problem, he said.
“There is no doubt there’s an abuse of the emergency room, and part of it is there is not enough primary-care physicians to see the patients,” he said.
The state’s plans for cutting costs by charging patients for services and reducing doctor pay are shortsighted, said Herbst of Kaweah Delta.
“I question the thinking of the state here,” he said. Sending more patients to hospitals “more than wipes out the short-term savings.”
By Barbara Anderson / The Fresno Bee
Judd Matsunaga of Elder Law Services is a qualified attorney who has helped hundreds of California residents with Medi-Cal Planning. Mr. Matsunaga can be reached for a free consultation by calling 1-800 403-6078.