It's a temporary victory as we await the inevitable appeals by the state, which approved the cut earlier this year, and which started on July 1st. The Budget Conference Committee proposal sought to restore those cuts in September, but that is in the context of a proposal with over $8 billion in revenues: the Governor's budget did not make those restorations.
The court agreed that the Medi-Cal cuts would reduce access for the 6.5 million children, parents, seniors and people with disabilities that depend on Medi-Cal coverage. Many providers already don't take patients with Medi-Cal coverage, given that the reimbursement rates are among the lowest in the nation.
But this doesn't means the fight over health care cuts is over, not by a long shot. We need to be as vigilant as ever.
This suit was only about the provider cuts. Other cuts sought to reduce the benefits provided to Medi-Cal patients. Others--including ones adopted by even the Conference Committee, and voted for by the Assembly Democrats on Sunday--seek to reduce the number of Californians, particularly children, on Medi-Cal coverage.
What this court decision makes clear is the stark choice for the budget negotiators: we need to raise the revenues needed to prevent the cuts that are so drastic, they may be illegal.
The vote wasn't a surprise, but it's still disappointing. The budget vote, largely along the Conference Committee framework, but with a rainy day fund, lottery securitization, and other elements, was voted on Sunday night.
While getting more than a majority of vote a long partisan lines with Democrats voting in favor(45-30, those not voting including Parra, Torrico, Aghazarian, and the medically excused Runner and Soto), the budget failed to get the Republican votes needed to pass the 2/3 threshold for passage for a budget and taxes.
We appreciate the Assembly leadership’s attempt to raise the revenues needed to prevent the worst of the proposed cuts to health care and other vital services—cuts that not only will make a millions of Californians pay more and get less care, but also harm the health system we all rely on. The cuts would also hurt our economy--resulting in lost federal matching funds, wages, and jobs into the billions.
But let's be clear: the budget considered tonight already has tough cuts—including denying a quarter-million children health care—and yet it is being held up, by those who want more cuts now, and a deceptive, arbitrary ceiling that will force ongoing cuts into the future. That’s the wrong direction. But that's the direction it looks these negotiations are going.
Steve Lawrence at the Associated Press writes about the new, troubling unemployment numbers released yeaterday. There was an attempt to make a connection with the budget, but some legislators came to the wrong conclusion.
Republicans said the jobless figures provided more evidence that lawmakers shouldn't consider tax increases to help eliminate a $15.2 billion state budget deficit.
"Our unemployment rate will grow far worse and more Californians will lose their jobs if we pass a budget that increases taxes," said Assembly Minority Leader Mike Villines, R-Clovis.
But health care advocates said state budget cuts would also lead to more job losses, partly because the state would be unable to put up seed money needed to attract hundreds of millions of dollars in federal aid. "The worst thing you can do for the economy is make cuts, especially to health care," said Anthony Wright, executive director of the nonprofit advocacy group Health Access California. "I think it's very clear that health care cuts specifically would have three times as great an economic impact as an increase of taxes on the upper income."
The Bakersfield Californian also has a quote from a Republican Senator, one we wholeheartedly agree with.
“Reductions in Medi-Cal causes increases in costs in other places,” said Sen. Roy Ashburn, R-Bakersfield, who wants the 10 percent cuts restored in the budget. “The fact is that the state underfunds the program.”
By raising the revenues needed to prevent cuts to health care, legislators can BOTH restore crucial funding to our health care system, and help stimulate our economy.
NEW STUDIES: PROPOSED HEALTH CUTS WOULD SIGNIFICANTLY HARM CALIFORNIA'S ECONOMIC HEALTH
*Study Reveals Over $2 Billion in Lost Business Activity, Shows County Breakdown of Lost Federal Matching Funds, Lost Wages, and Lost Jobs As Result of Budget Cuts * As Legislators Weigh Budget Choices, Study Shows Health Cuts Would Have Three Times Economic Impact as Compared to Upper-Income Tax Increase
*Study Shows $290 Increase in Private Insurance Premiums Due to Health Cuts
Click for What's New on the Health Access WeBlog: More on Budget Negotiations; Spending Cap Proposals; Pending Health Legislation in Sacramento; The Health Reform Discussion
SACRAMENTO--On the day the California Employment Development Department released jobless statistics showing unemployment rates reaching 7.3%, with 15,000 Californians losing their jobs in July alone, two new Health Access reports exhaustively detail the significant economic impact of proposed health care cuts.
As California lawmakers debate budget cuts, taxes, and the economy, the two studies shows the proposed $850 million in health care cuts would lead to over $2 billion in lost business activity and 16,500 jobs lost as a result of budget cuts -- three times the economic impact of an equivalent increase in upper-income taxes -- and families facing a $290 increase in private insurance premiums to make up for the lost revenue in the health care system. The reports are available at: www.health-access.org.
One report utilizes standard economic tools to show the significant economic impacts of the proposed health services budget cuts, of jobs, lost wages, and lost business activity on a county-by-county basis. Another report includes new data by researcher Peter Harbage that shows that costs for insured families will rise due the need to make up for the lost revenue in the health care system as a whole.
The reports suggests that if policymakers are concerned about the economy, the worst choice would be to approve these health care cuts, which would force California to lose hundreds of millions of dollars in federal matching funds--which then has ripple effects throughout the economy, impacting jobs, wages, and even health insurance costs.
Key findings of the report include:
· More Than a $2.1 Billion Economic Loss Statewide in the First Year, including 16,500 Lost Jobs: By cutting nearly over $800 million billion in health care spending, California will lose its dollar-to dollar federal matching funds. The loss of these dollars in circulation had additional economic consequences of more than $2 billion, in lost commerce, lost wages and lost jobs.
· Severe Reverberations in Both Urban & Rural Counties: Fifteen counties in California are expected to see losses in economic activity in excess of $30 million. Areas severely impacted by the proposed cuts include the Central Valley, with Kern, Fresno, and San Joaquin counties losing an estimated total of $183 million in business activity and $64.8 million in wages.
· Increased Health insurance Premiums Rise by $290: The budget cuts propose to deny coverage to around one million more Californians, leading to a cost shift from medical providers will end up treating more patients who cannot pay for services.
This paper also shows how, due to federal tax deductions and matching Medicaid dollars, preserving California's health care budget would have three times the positive economic impact as preventing an equivalent amount of increased taxes for upper income Californians.
Additionally, the report "Significant Side Effects: The Economic Impacts of Health Care Cuts in California Communities," by Hanh Kim Quach and Anthony Wright, also describes other economic impacts from the cuts and from the additional uninsured, including lost productivity, lapses in school attendance and education funding, and increased instability of family finances.
The other report, "Adverse Reaction: Proposed Health Care Budget Cuts Would Lead to Increased Health Insurance Premiums," was written by Harbage Consulting. Both studies were commissioned by Health Access Foundation, the statewide health care consumer advocacy organization. Earlier this year, Health Access had released a report detailing the coverage impacts of the health care budget cuts, which would deny over one million Californians coverage when the cuts were fully implemented.
With all the rumors swirling about, let's be clear: Spending cap? Unless the details can address several key issues, we're opposed. And a temporary tax increase is not an incentive to change that position.
Health Access California has been devoting significant effort to working to prevent devastating health care cuts. But it wouldn't make sense to prevent some of those cuts now, in return for a spending cap that would force those cuts, and more, in the future.
There may be reforms to the budget process that do make sense--I'll mention that we were a leading voice and organizer in the campaign for Proposition 56 which had several ideas in it--since some policymakers are in the mood of resurrecting the provisions past ballot measures.
But most spending cap proposals I've seen have been fundamentally destructive to the health care system we all rely on. All Californians who care about health care should be wary, if not outright opposed.
* A spending cap is unlikely to take into account medical inflation, so when health care costs rise as a faster clip, that would create even more pressure to make cuts.
* Other areas of the budget have voter-approved protections and dedicated revenue streams that health and human services largely do not, making these vital services at greater risk of cuts.
* Finally, and most importantly, a spending cap condemns us to the health care system we have. It may keep us at 49th in the nation in Medicaid per patient spending, and having one of the largest uninsured rates in the country. It may prohibit coverage expansions and health reform in general.
When these budget issues occur, there are choices to be made to make the budget balance: make cuts? raise taxes? both? But we shouldn't pre-suppose to make those choices now, and to top the scales to force cuts, now and into the future.
With a budget still not in place, and devastating health care cuts hanging in the balance, a coalition of health care stakeholders are extending a run of TV ads in the Central Valley, Central Coast, Inland Empire, and Palm Springs areas--all to highlight the issues that are at stake.
Regions that will be hit particularly hard by proposed state health care cuts--Bakersfield, Fresno, Modesto, Riverside/San Bernardino, San Luis Obispo and the Coachella/Imperial Valleys--will continue to see the ads as part of an evolving campaign (of which Health Access California is involved).
Here's the script:
“In Sacramento, cutting funding for doctors and hospitals is just a number on a spreadsheet. But around here, you’re going to see fewer nurses, and fewer hospital services for patients. Cutting back on ambulances will mean slower response times. More time in the waiting room and higher costs we can’t afford. But if the legislators we send to Sacramento do their job, we can keep doing ours. Stop the health care cuts, or we’ll all pay the price.”
Ed Mendel at the San Diego Union Tribune reports that our protracted, though expected, budget stalemate is leaving lots of rural hospitals in a bind. Many of these hospitals, which run on really thin margins as it is, are having to seek emergency loans from banks, which are also stretched thin because of larger economic issues -- like that mortage thing.
To exacerbate health care access, beginning next week, the state will not be paying Medi-Cal to the state's 600 community clinics. The clinics, which serve 3.6 million people annually, are the most efficient way to deliver regular preventive care to the Medi-Cal and uninsured population.
Ironically, the rural areas that are experiencing the most immediate problems are represented by Republicans, who have talked about how they don't want to cut provider rates and make sure health care access is preserved, but in conference committee voted against all of the rate reimbursement increases for providers who care for Medi-Cal recipients.
* Families would also feel the mulitple impacts of the cuts: the same family that loses Medi-Cal coverage for a child, or dental benefits for an adult, may also lose a cost-of-living increase in other types of assistance, from child care to in-home assistance for the elderly or disabled. Wes Woods at the Inland Valley Daily Bulletin reports about the impact in San Bernardino county.
* Kids would get the "triple whammy," according to reporting by Sarah Arnquist at The Health Care Blog. State budget cuts would only exacerbate the situation with counties that are being forced to drop children from coverage--some that has already been announced in Alameda County and could be done soon in counties like Los Angeles. This is under the backdrop of declining employer-based coverage for kids, and these state and county public programs would no longer be able to pick up the slack.
These are different regions, and there are multiple ways the cuts get felt (providers getting decreased funding but increased demand, families getting cut in multiple services, and cuts at the state and county level as well as the private sector), but it's clear that without a budget that prevents these cuts, Californians will feel them--from many different directions.
They will need to take out lines of credit until a budget is passed, when they can finally get reimbursed. The cash crunch by the State of California, will, in effect, cause cash crunches at clinics and other health providers up and down the West Coast.
So we need a budget passed urgently--but we also need the right budget passed. The clinics and health providers won't be too happy if the reimbursements they will eventually get back are cut, this year and into the future. Or if it means that a million more uninsured Californians are showing up at their door.
On the budget: Do it. Do it right. Do it right now.
Who gets impacted by the Medi-Cal cuts? Everybody. It impacts the health system on which we all rely.
Barbara Anderson of the Fresno Bee reports on the challenges to the Medi-Cal program, and in a separate article, solicits potential solutions from some key leaders in the Central Valley, where the system is so stretched already that the consequences of the cuts could be dire. I stated that we need to raise the revenues needed to prevent cuts as a first step; I also agree that then we need to pursue health reform, as put forward by Dr. Kratzer and Dr. Maffeo in the write-up.
The article mentions an ad campaign against the cuts sponsored by an unusually large spectrum of health care stakeholders: doctors, hospitals, insurers, health care workers, as well as seniors and consumers (including Health Access California). These are groups that usually don't agree on much--we are actively supporting bills this year opposed by one of these groups or another--but we agree on the severity of the cuts to the whole health system. These are deep, systemic cuts that would undermine the health system for the uninsured and insured.
The most explosive, least reported story of the week--the equivalent of children getting pink slips:
Alameda Alliance for Health to close Healthy Kids Program, blames state funding woes San Francisco Business Times
A lack of permanent funding from public and private sources, and the failure of health-care reform in California is forcing the public Alameda Alliance for Health to close its Healthy Kids program, officials said Tuesday.
The closure, which will affect 1,000 poor children in Alameda County, is scheduled to take place Sept 30.
The Alliance is a non-profit, state-licensed health plan that attempts to make high quality health care services "accessible and affordable" to poor residents of the county, officials said, including children from families that don't qualify for other public programs, due to income requirements or residency status.
The Alameda County plan, started in 1996, provides services to 92,000 Alameda County residents through programs such as Medi-Cal, Healthy Families, Alliance Group Care and Alliance CompleteCare.
County officials called the pending closure "an act of last resort" and Lamirault added that some children who are losing their Healthy Kids coverage may be eligible for Kaiser Permanente's Child Health Plan.
The Alliance was one of 10 counties statewide that began its Healthy Kids program in the fall of 2005, officials said. Today 30 counties offer the program, which provides comprehensive health care coverage to more than 80,000 children each year.
Some funds from the nonprofit California Endowment were committed for the older participants, but significant funding from Alameda County's Tobacco Settlement Funds have been "redirected to support other county priorities," due to the state's budget crunch.
Alameda isn't the only county where this will happen. It's a shocking thing, for California counties to drop kids from coverage, but that's exactly what is happening.
The Legislative Budget Conference Committee just approved Semi-Annual reporting for children on Medi-Cal.
Right now, children renew their eligibility annually, and adults twice a year. But periodic status reporting is a *passive aggressive* way for the state to reduce the number of people in Medi-Cal by hoping they don't "report'' their status on time. Under Gov. Arnold Schwarzenegger's original -- more draconian -- proposal requiring reporting every three months, the administration assumed 471,500 children (a drop off of 24%) would be eliminated from the rolls.
We don't have officials numbers yet on how many children would lose coverage under semi-annual reporting. But let's just slice the Quarterly number in half -- just to give us a working number -- and say about 235,750 children would lose coverage under semi-annual reporting.
The compromise attempts to soften the blow by saying the semi-annual status reports will sunset (for children only, adults will continue to be semi-annual) by December 31, 2011. But what does the sunset really mean for the child who needs asthma inhalers this year. Who falls of his bike, next year. Who gets pneumonia, in two years?
They'd be in line, to get back on Medi-Cal. Long-suffering counties, who will not receive extra funding to process the additional paperwork as a result of Semi-Annual Status Reports, will have a hard time handling the extra load, meaning it will be harder for kids to get coverage.
Assemblyman John Laird, who sadly will be departing the Legislature this year, gave a fantastic speech about how he hated having to support this compromise.
"I'm extremely unhappy about this...it's not the right direction to go....I'm kicking and screaming, but going to vote for this. But, if there is a hint that people want to move toward something more draconian, I will wage a full-pitched fight and advocate to go back to where it is now (annual reporting.)"
Soon-to-be Sen. Mark Leno reiterated Laird's position also.
"I think we need to be honest about this. We're shifting the responsibilities of children to county hospitals and emergency rooms. It's not an efficient way to have health care provided."
Also part of the compromise: an assessment on the effects of semi-annual status reporting. But we won't get to see the results of it until December, 2010 -- when we have just a year left until the sunset.
Republicans got to dodge a vote. They wanted more kids to drop off rolls with quarterly status reports.
Overall, this is a really profoundly troubling budget and a really pathetic statement of our priorities when we let more than 200,000 children -- who otherwise would be eligible for coverage -- just fall off and go without healthcare.
And it's really sad that the choice had to come between cutting already inadequate Medi-Cal reimbursement rates for doctors who care for these kids -- or letting really low-income kids (living in families that earn less than $17,600 a year for three) go without health insurance.
This should not be the choice... of worse and worse. This should not be the state we are fighting for.
I meant to call attention to this story last week:
A bunch of employees were laid off at Children's Hospital in Oakland. Mayhem ensued. Appointments, surgeries cancelled. Uncancelled. Patients stranded everywhere. The culprit: 10% Medi-Cal rate reductions, which went into effect Tuesday July 1.
While the budget conference committee on Thursday mostly restored these cuts, those restorations are *contingent* on there being more revenues. So if we don't have more revenues -- we can expect more of this....
BUDGET CONFERENCE COMMITTEE CLOSES OUT MOST HEALTH ITEMS * Democratic-supported budget would largely restore Medi-Cal rate reductions * California Discount Prescription Drug Program continues * Semi-Annual Reports and Healthy Families premium increases still in negotiations * Conference Committee could close down as early as this Sunday, July 6th
Click Here for What's New on the Health Access WeBlog: More on the Health Care Budget Cuts; the Onion on Kids Coverage; Update on MA; Provider Rates; A Clear, Stark Choice; Missed Budget Deadlines; Reporting "Never Events"; How Many More Uninsured Under the Legislature's Budget?; Where Our Premium Dollars Go; Patients, Not Paperwork; Blog Watch
The Budget Conference Committee, led by Senator Denise Ducheny and Assemblyman John Laird, met this Thursday afternoon and reached agreement on a number of items of note to health advocates.
These decisions largely reflect current agreement between the Democratic majorities in the legislature; no budget decisions are final until the Legislature approves a budget by a two-thirds votes, which requires Republican votes, and the Governor signs the budget. However, these decisions shape the parameters of the budget negotiations this summer. The issues addressed today include:
PRESCRIPTION DRUG DISCOUNTS: The California Prescription Drug Discount Program, AB 2911 (Nunez), supported by Health Access California and a broad "Rx Coalition" of consumer, labor and senior groups, was passed and signed into law in 2006. The program would allow up to five million Californians with no or inadequate prescription drug coverage to buy prescription drug at prices 40 to 60 percent below the sticker price. The discounts would be achieved through contracts with pharmacists and negotiations with drug manufacturers.
The program, though, has not yet been implemented due to budget constraints. The program was in danger of being deferred yet another year until a compromise on the measure was reached Thursday. Under the compromise, the program would be started and implemented in the budget year, but the state would defray the costs to administer the program with a small portion of the manufacturer rebates.
MEDI-CAL RATE REDUCTIONS: The Committee also voted to restore most of the 10 percent rate reductions which took effect two days ago. The higher rates will take effect September 1, 2008. Any services provided between July 1 and August 31 will be reimbursed at the lower rate. The partial rate restorations are all contingent upon a budget agreement that includes revenues.
Following is an accounting of how each individual cut was restored and how the committee votes:
* Providers: Restored most of 10% payment reduction ($158.3 million); Vote: 2-1, 2-1, Republican members voting no * Pharmacies: restored half (5%) of the payment reduction ($76.3 million); Vote: 2-1, 2-1, Republican members voting no * Pediatric Sub Acute Care: restored all of payment reduction ($1.8 million); Vote: 2-1, 2-1, Republican members voting no * Long-term Care: restored half (5%) of the rate restoration ($24.6 million); Vote: 2-1, 2-1, Republican members voting no * Managed Care rates: restored half (5%) of the payment reduction ($99.2 million); Vote: 2-1, 2-1, Republican members voting no * Breast and Cervical Cancer treatment: restored full amount of payment reduction ($1.2 million); Vote: 2-1, 2-1, Republican members voting no. * Non-Contract Hospitals: Compromise would treat small, rural and children’s hospitals as contract hospitals. Vote: 3-0, 3-0
CHILDREN SERVICES: Rates paid under the California Children’s Services (CCS) and Genetically Handicapped Persons Program (GHPP) would be mostly restored by September 1, contingent upon revenues. The governor had originally proposed a 10 percent rate reduction for these programs’ services. In both cases, the vote was 2-1, 2-1, with Republican voting against the partial restorations.
ITEMS REMAINING OPEN: Still in negotiations remain the Semi-Annual Status Reports and additional county administrative funding should those reports be approved. Healthy Families premium increases also remain open. Both would not only place paperwork and additional costs onto families with children on Medi-Cal and Healthy Families coverage, respectively, but would also cause a reduction in enrollment and an increase in California children without coverage.
The children's groups that make up the 100% Campaign are urging health advocates to call members of the Conference Committee to urge them to reject these additional barriers to kids' coverage. Their most recent alert is listed here: http://www.100percentcampaign.org/resources/updates/2008/update-080624.html
CALENDAR: The Budget Conference Committee is expected to return July 6th, Sunday evening to close out the remaining items. Legislative leaders hope to have a vote on the budget by mid-July.
The Senate plans to hold Appropriations hearing the upcoming week and Monday July 14th and then take summer break until August 4th. The Assembly plans to hold its last Appropriations before break on July 16th before leaving and returning on August 4th.
Health Access will keep advocates abreast of these activities. For information, please contact the author of this report Hanh Kim Quach, policy coordinator, at hquach@health-access.org.
As we await to see what the Budget Conference Committee does about imposing more paperwork burdens to have hundreds of thousands of children fall off coverage, here's something for your holiday weekend amusement. From the Onion News Network, it's the only support I've seen for cutting children's health care:
As July 1st, today got a lot of attention for being the start of the state's fiscal new year... and get another year where the budget is not done on time.
Presumably, a budget will be agreed to and signed into law later this summer. What's more important is that this is the first day that the 10% Medi-Cal provider rate cuts go into effect.
This doesn't just impact doctors, hospitals, and other providers. It hurt patients who find it harder to get a doctor, or specialist. (One study indicated that more than half of California doctors don't take Medi-Cal.) It is a major cut to the health care system on which we all rely. And unlike the delay in the budget, it is permanent, unless the Legislature reverses the cuts.
Let's be clear: the Democratic majorities are offering to restore these cuts. But that won't happen unless the Democrats in the Legislature are able to get their fellow Republican legislators to support the taxes needed to restore those cuts. And until such a decision is made, patients and providers will have to suffer with the cut and its consequences.
Editorial: Budget deal will do real damage to health care
The choice is clear: Increase taxes or let the impact fall on children and the elderly
...Faced with a $17 billion deficit, the governor and state lawmakers are considering cuts that would likely drop tens of thousands of children from the Medi-Cal program, the state's version of Medicaid. They also are considering restricting adult eligibility requirements for Medi-Cal, hurting families trying to transition from welfare to work.
Elderly patients would also take a hit. As part of a 10 percent cut scheduled to take effect today, the state plans to reduce payments received by pharmacists who serve Medi-Cal patients. Pharmacists say it would force them to lose money on commonly prescribed drugs, and to choose between taking fewer Medi-Cal patients or cutting staff and limiting hours...
Legislators, particularly Republicans who have taken a vow not to raise taxes under any circumstance, need to consider the consequences.
Start with children. Currently, about 3 million children in California receive health care through Medi-Cal, and eligibility for the program is determined annually. To save $92 million in the budget, Schwarzenegger wants to reinstate a rule that families on Medi-Cal submit paperwork every three months to prove their eligibility, instead of every 12 months.
About 150,000 children are expected to lose coverage this year – and 470,000 eventually – because their families either fail to file the required forms or they can't meet the program's eligibility rules. The quarterly reporting requirement will also add to the burdens of counties, who will have to process all the extra paperwork.
For these reasons and others, the Assembly rejected the administration's proposal, while the Senate has come back with a "compromise" – requiring Medi-Cal recipients to file paperwork twice a year, instead of four times.
This is hardly a compromise. As senators and Schwarzenegger are well aware, kicking poor people out of the Medi-Cal program will only force them to go to the emergency room, or avoid treatment for diabetes, high blood pressure and other chronic diseases.
While campaigning for health care reform last year, Schwarzenegger often talked about the "hidden tax" that uninsured people impose on hospitals, businesses and local governments. It would be revealing for the governor to calculate the hidden tax he will impose on this state if these Medi-Cal cuts are fully enacted.
A better option would be a modest, broadly distributed levy – yes, a tax – to prop up this state's health care program for the poor. Consider it a down payment on a once-and-future goal: a more universal system of health coverage
For those following the budget, we have one-sheet on the proposed health cuts in the 2008-09 Health Care Budget on our home page.
The Budget Conference Committee is expected to come back on Monday, and perhaps close out in this week. Our website also has an often-updated Budget Cuts Scorecard where you can follow along to see--item by item--what the Assembly has done, what the Senate has done, and what the Conference Committee had done on a specific cut.
The scorecard answers the relevant question: where is the Legislature on the proposals that would deny coverage to one million Californians?
Our report details four cuts that lead one million Californians to be denied: * One of the biggest and most direct cuts, to directly close eligibility for 430,000 low-income working parents, has been rejected by both the Senate and the Assembly. * Two of the smaller cuts have been accepted by both the Senate and Assembly: the increase in premiums for Healthy Families, and the suspension of key reforms to streamline eligibility for children. Together, that potentially would prevent as many as 160,000 children (and some parents) from getting coverage. * The Assembly rejected the other big cut, to impose paperwork requirements through quarterly status reports, which would by 2010 deny coverage to 470,000 children. The Senate, however, is looking at imposing the additional paperwork every six months, which would have from a third to half the impact, but it would still be significant. We'll see what they decide.
In short, the Legislature has indicated that, in the best case scenario, the budget will contain health cuts to leave roughly 150,000 more Californians without coverage. The Conference Committee will determine if that number could go to 300,000 or more... and if the "Big 4" negotiations between the Democrats and Republicans don't yield the necessary revenues to prevent these cuts, the number of uninsured Californians could grow by over one million.
Let's also not forget two other major categories of cuts: the provider rates, which were cut 10% and the Legislature is considering making some restorations; and the proposed elimination of dental and other key benefits to Medi-Cal patients, the impacts of which are detailed in this fact sheet, entitled "Vital Medi-Cal Benefits on the Chopping Block ".
Decisions made in the next weeks will determine the fate of care and coverage for hundreds of thousands, if not millions. The stakes are high.
Great editorial in the LA Times today: should we spend on healthcare, or on paperwork? That's the proposal in the Governor's budget, and while the Assembly rejected it, the Senate is still considering a modified version of the proposal. Read the whole thing, but here's the final paragraph:
The semiannual applications are projected to save California $25.6?million while taking medical coverage away from tens of thousands of children. Meanwhile, the costs of doubling the paperwork would erase much of the savings. The health of poor children is a vital social interest; more paperwork is not.
Earlier this week, Governor Schwarzenegger called the number of uninsured in California a "moral crisis"--and he was right, both about that and the need for concerted action on health reform.
Unfortunately, the Governor's cuts-only budget goes in completely the opposite direction, making our health care system even more broken, and leaving more people uninsured. Today, we are releasing a report that reveals the full magnitude of the cuts the Governor proposes--with over one million more Californians uninsured. While the Legislature has adopted some of these cuts and rejeced others, all of these proposals are on the table until a budget solution is agreed to. There's early press from Aurelio Rojas at the Sacramento Bee and Jordan Rau of the Los Angeles Times.
HEALTH ACCESS UPDATE Thursday, June 26th, 2008
New Analysis Reveals Full Impact of Governor’s Health Cuts: One Million More Californians Would Lose Health Coverage
* Permanent Policy Changes, Not One-Time Cuts, Would Hinder Reform * Magnitude of Cuts Would Have Ripple Effects Through System * Health Consumers and Providers Urge Alternative to Cuts-Only Budget
Over one million more Californians would lose health coverage, with significant impacts throughout the state’s health system, if the Governor’s budget and health cuts were passed, according to a new analysis today.
The study, by the health care consumer advocacy group Health Access Foundation, uses information from the Schwarzenegger Administration, but shows a much greater magnitude than earlier estimates, which only looked at the impact of the cuts for less than a year, and not at full implementation.
The study shows that these health care budget cuts are of a magnitude that will impact every Californian, as they place huge burdens on the health system we all rely on. These are permanent, not just one-time cuts, to leave more than one million more Californians uninsured, and over three and a half million having to pay more and get less.
Previous summaries of the Governor’s budget proposals, including the May Revision, show the impact of the cuts in only the first year – with tens of thousands losing coverage or being barred from enrollment. But the impact is much greater, in three ways:
The Governor’s budget is not proposing one-time budget savings, but lasting policy changes and coverage reductions for the health care system.
A snapshot of the savings in the budget year does not reveal the full impact in the following years, once the reductions have been enacted and all the administrative changes have occurred to continue the reductions.
Finally, the cumulative impact of all the proposed cuts, when added up together, suggests that the magnitude of the cuts—with more than a million moreuninsured—will have impacts not just on specific programs but on the entire health care system on which we all rely.
The permanent policy changes reflected in the budget will be in place long after the 2008-09 budget year comes and goes. Of note, these policy changes are contrary to health reform proposals the governor previously put forward.
The cuts include: * A roll-back of eligibility for basic Medi-Cal coverage for low-income working parents to well below the poverty level. (429,000); * Additional paperwork burdens for children and adults, requiring reports every three months in order to avoid disenrollment (471,500); * Suspension of already-passed legislation to streamline child enrollment (97,000) * Increased premiums for children’s health coverage, leading to decreased enrollment (60,000).
The cuts represent a reversal for the Administration, reducing programs that just a few months ago were being considered for massive expansions to provide coverage to millions more people. Rather than shrinking the number of uninsured, the Schwarzenegger budget would increase the number of uninsured substantially.
The report includes appendices that include: * a county-by-county breakdown indicated the increase in the uninsured by county by 2010, the last year of the Schwarzenegger Administration; * a chart comparing the policy changes in the Governor’s budget that would restrict coverage, to the health reform proposal supported by the Governor earlier this year to expand coverage; and * a further detailing of the populations that under the proposed cuts would be forced to pay more or get less benefits, totaling 3.5 million Californians.
Allowing one million more California children and parents to go uninsured creates ripple effects throughout the entire health care system. It includes:
an increased burden on “safety net” providers, from emergency rooms to hospitals to community clinics—many of which are dealing with direct cuts of their own;
a cost-shift, from both the uninsured and reduced Medi-Cal provider payments, to private purchasers of health care—which likely means increased premiums; and
worse health and economic impacts for California communities, from the destabilizing impact of more children uncovered and getting sicker, to more families facing medical debt and bankruptcy for being uninsured.
As a result, all Californians—not just the million more uninsured—will be impacted these cuts. The report makes clear the stark choice the budget debate this summer presents for California policymakers, between allowing these devastating cuts to move forward and to make these structural policy changes to our health care system, or to find the revenues needed to prevent these cuts.
BUDGET CONFERENCE COMMITTEE DEBATES HEALTH ITEMS * Budget Conference Committee attempts to reconcile Assembly, Senate decisions * Drug discount program, QSRs, and provider rates debated; Most items left open. * These and other cuts dependent on final budget resolution and revenues
Budget season is in full swing as the bi-cameral Budget Conference Committee began meeting this past Thursday.
The conference committee is made up of six members -- three from the Assembly and three from the Senate. The Senate conferees are Senators Denise Ducheny (the chair), Bob Dutton, and Mike Machado. The Assembly conferees are Assemblymen John Laird (the vice-chair), Mark Leno and Roger Niello. Together, their task is to pore through a 439-page agenda contains all the differences between the Senate and Assembly version of the budget and reconcile them.
Health programs sit right in the middle of that agenda and came up Saturday afternoon. Health Access tracked discussions on the health budget on our blog in real time at: www.health-access.org/blogger.html.
Some of the most severe cuts, like direct cuts to Medi-Cal eligibility for working parents, were rejected by both the Assembly and Senate majorities and those are not "in conference." However, the legislators again repeated today that those cuts are still pending, unless the budget includes revenues to offset those cuts.
The conference committee focused on items where the Assembly and the Senate took different actions. That includes: * the start of the California Discount Prescription Drug Program, where the Senate voted to defund the program and delay the start of it for a year, and the Assembly (along with the Governor) allowing the program to get underway, to start negotiating with drug companies. * the question of imposing additional paperwork burdens for children on Medi-Cal, through quartely status reports. the Assembly voted against the proposal; the Senate put forward a modified proposal to have children's families renew their coverage every six months, rather than on an annual basis. * the biggest dollar amounts considered were whether to restore the 10% provider rate cut made this February for doctors, hospitals and others who care for patients with Medi-Cal coverage.
Most items heard today, including these three areas, remained open while lawmakers directed staff to work out compromises or gather more information about the programs. Before leaving the items "open," lawmakers debated quarterly status reporting for children and adults, and the 10% rate cut for providers, as well as the frustration that many of these cuts mean losing federal matching dollars as well.
"We can talk about all we want to about restoring cuts, or we can defer the consideration of cuts, but until we can put focus as to where we are going to go with revenues, we are creating a false document,'' said Sen. Mike Machado, urging lawmakers to look realistically at the state's fiscal problems. "I think it's very difficult to talk about this if we're not going to talk about the revenue side. We're creating a budget in a vacuum.''
One cut that was made was to accept the Governor's proposed reduction to hospitals who do not contract with Medi-Cal.
The committee ended Saturday afternoon on an up note, with some federal funds identified that could be applied to California Children's Services, which pays for medical care for children with chronic illnesses and disabilities. The committee approved a compromise measure between the two houses on this issue.
Again, no decisions are final until a final budget is passed and signed into law.
Health Access will continue to track the Budget Conference Committee, which will resume Monday, June 16th at noon to continue discussion of health-related items, including to clinics and the Healthy Families program.
In the meantime, Health Access keeps a scorecard of items of interest to health advocates. For more information, contact Hanh Kim Quach, the author of this report, at hquach@health-access.org.
Sen. Denise Ducheny corrected Assemblyman Niello's assertion that the budget debate has not included all the ways Medi-Cal could be reduced. The problem is, she said, cuts to benefits save so little.
Sen. Bob Dutton, R-Inland Empire, had a few interesting comments that I hope he'll remember in the future:
"I don't want to cut things that are going to get matching dollars from the federal government.'' In the Medi-Cal program, the federal government matches eligible expenses dollars for dollar. It means that for every dollar California cuts, we lose an additional dollar in federal investment. Duh. This logic should be applied anytime he looks at a Medi-Cal cut.
Dutton also made a logical argument for why provider rates ought not be cut: because it would discourage providers from taking more patients in certain areas and drive patients to the emergency room. Bingo.
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