Gov. Brown backs exempting some nursing facilities from Medi-Cal cuts

Gov. Jerry Brown has agreed to scale back his cut to California’s public healthcare program, endorsing legislation that would exempt some nursing facilities from a reduction in Medi-Cal funding.

A previous effort to protect funding for such facilities stalled in an Assembly committee earlier this year, but the proposal was revived and inserted into a separate bill (SB 239) this week.

The measure is expected to be approved by the Legislature on Thursday.

Jan Emmerson-Shea, a spokeswoman for the California Hospital Assn., said the potential loss of funding would have been devastating to nursing facilities and forced patients into more expensive treatment centers.

“The bill is a win-win, both for the state and for hospitals,” she said.

Administration officials had expected to save $352.7 million annually from reducing Medi-Cal payments to doctors, pharmacists and other healthcare providers by 10%. The cut, which was blocked for two years by a lawsuit, is being phased in over the next several months even though the state’s financial situation has improved.

The exemption for some nursing facilities – specifically, facilities that are part of hospitals but located in separate buildings – is expected to reduce the state’s annual savings by about $62 million.

The state had previously agreed to protect funding only for facilities in rural areas, one of several exemptions from the 10% cut. Other exemptions are being made for extensive dental surgery for children and some pricey prescription drugs.

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Twitter: @chrismegerian