Brown, lawmakers hunt Medi-Cal money

Hoping to fill a “billion-dollar hole,” lawmakers were poised to gather in a special session Friday to figure out new sources of funding for the state’s complex health care programs – including Medi-Cal.

Gov. Brown called for the session to cover losses caused stemming from the way taxes are levied on managed care organizations, or MCOs, that focus on providing services for reducing health care costs and improving benefits. The governor announced the session this week after reaching a $115.4 billion budget agreement with legislative leaders.

The announcement came on the same day that State Auditor Elaine Howle issued a report that criticized Medi-Cal.

The Legislative Analyst reported earlier that the managed care organization tax failed to comply with new Medicaid law and regulations. That regulation stated that the tax must be broad-based and not limited to Medi-Cal, the program that provides health care services for millions of low-income people.

Brown had proposed in February that the managed care organizations tax be restructured to comply, following the Legislative Analyst’s report. The current structure, which generates over $1 billion, is set to expire at the end of the 2015-16 fiscal year.

“If we don’t find a substitute for the MCO tax, then we’re looking at a billion-dollar hole next year,” said Brown during the Tuesday conference.

This announcement came on the same day that State Auditor Elaine Howle issued a report that criticized Medi-Cal for failing to ensure that health care providers are accessible to their patients and able to respond to all inquiries or requests.

In 2011, Medi-Cal providers such as doctors, hospitals and dentists had their payment rates cut by 10 percent, as a way to balance the state’s budget.

Howle noted that up to 45,000 calls a month to the Medi-Cal Managed Care Office of the Ombudsman were rejected this past year, which included January 2015. Of those calls that did manage to go through, only a small fraction were handled each month.

“This audit confirms longstanding concerns about the oversight of Medi-Cal managed care plans,” said Anthony Wright, executive director of Health Access, an advocacy group that seeks to expand quality health care.

“These Medi-Cal managed care plans are how we are promising to deliver care to millions of Californians, but we need stronger oversight to ensure these commitments are being met,“ he added in a press release.

Additionally, Howle’s audit said that an average of 12,500 phone calls went unanswered between February 2014 and January 2015.

Jennifer Kent, director of the Department of Health Care Services, responding to Howle, said that a new phone system to properly direct those unanswered calls  will be in place by September. Public health care providers have often seen these issues as a result of poor state funding in previous years.

“We put $10 million of that money toward television, radio ads, also outdoor advertising to really talk about the issue of Medi-Cal underfunding.”

In 2011, Medi-Cal providers such as doctors, hospitals and dentists had their payment rates cut by 10 percent, as a way to balance the state’s budget.

The state now has one of the lowest payment rates in the country, with doctors receiving as little as $16 for a Medi-Cal patient visit, according the California Medical Association. This makes it difficult not only for patients to get in contact with their providers, but also for providers to get compensation for their work.

The underfunding of California’s public health care system has become a central issue of several rallies since the 2011 decision

The California Hospital Association teamed up with organized labor groups on June 2 to rally against the cuts. At the same time, the group Caring for Californians put forth $100 million to spend on television ads over the next two years.

“We put $10 million of that money toward television, radio ads, also outdoor advertising to really talk about the issue of Medi-Cal underfunding,” said Jan Emerson-Shea, a spokeswoman for the California Hospital Association.

On Wednesday, a rally was held by advocates for the developmentally disabled outside the Capitol, which raised concerns after a legislature proposed $100 million provider rate increase was left out of this year’s final budget deal.

Rally attendees attempted to stage a sit-in in front of Brown’s office, but were blocked from entering the building, Capital Public Radio reported.

The announced budget deal would also extend public health care coverage to first-in-the-nation immigrant children, some of which are residing in California illegally. That expansion would begin in May 2016, and is expected to cost $40 million in the next budget.

Senate President pro Tempore Kevin de Léon, who spoke during the press conference along with Brown and Assembly Speaker Toni Atkins, said that this decision was a smart move in the long run.

“First and foremost, this budget makes another down payment on the more stable, sustainable fiscal future,” said de Léon, “with billions in reserves to further ensure that California’s boom-bust budget roller coaster is a thing of the past.”

The session is also expected to address the funding of In-Home Supportive Services, additional rate increases for the providers of Medi-Cal and ways to increased funding for developmental disability services.

During the Tuesday press conference, Brown also announced a budget agreement and a second special session on transportation and infrastructure funding.

“The work never ends,” said Brown. “And in the coming months we’ll have to manage our resources with the utmost prudence and find more adequate funding for our roads and health care programs.”
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Ed’s Note: Virginia McCormick, a journalism student at Sacramento State University, is a Capitol Weekly intern.