California Gets OK to Proceed with Medi-Cal Rate Cuts
California has received federal approval to enact up to $623
million in cuts to the state’s Medi-Cal program, including
reductions to the rate the state pays to Medi-Cal providers.
The state Department of Health Care Services (DHCS) made the
announcement yesterday that the Centers for Medicare and Medicaid
Services (CMS) had approved three key elements of the state’s
2011-12 budget plan, including a 10 percent provider rate
reduction for outpatient services. This rate reduction will
affect the amount the state pays to physicians, clinics,
optometrists, therapists, and laboratories, as well as for
services like dental, durable medical equipment, and pharmacy.
CMS also approved new 10 percent provider rate reductions for
freestanding nursing and adult subacute care facilities as well
as rate freezes for certain nursing homes.
However, CMS has yet to rule on other components of the state’s
2011-12 budget, including adding co-pays for Medi-Cal recipients
and limiting the number of times people can see a doctor each
year. The state also withdrew a request to cut rates to hospitals
and children’s medical providers earlier this year.
The DHCS also announced yesterday a “groundbreaking” program to
monitor the effects of the provider rate cuts on providers and
access. The state took steps to develop ways to measure and
monitor provider access in 23 ways. The monitoring measures
assisted the state in deciding which rate cuts to withdraw from
CMS.
The state’s Medi-Cal program serves more than 7.6 million
enrollees, and California spends more than $14 billion on the
program annually. However, even before the CMS ruling yesterday,
the state already spent less per beneficiary than any other
state.
