When the California Endowment, a private foundation that promotes access to affordable healthcare, offered the state government $6 million to help prevent poor Californians from dropping out of the Medi-Cal health insurance program, you might have expected officials to smile and say "Thank you." Instead, the Brown administration, which projected that the state would save money if more people dropped out of Medi-Cal, persuaded lawmakers to remove the funds from the budget for the coming fiscal year. That was a bad call. As important as it may be to control healthcare costs, the wrong way to save money on Medi-Cal is to hope that fewer people use it.
Medi-Cal is the state's version of Medicaid, a joint effort with the federal government to insure the poorest Californians. The 2010 healthcare law made single adults eligible for the program for the first time and raised the income limit to 138% of the federal poverty level, which is just under $20,000 for a family of three. Effective this year, it also changed the way a recipient's financial eligibility is calculated, focusing on the gross income a household would report to the Internal Revenue Service. As a result, Medi-Cal enrollees will have to fill out a new and potentially confounding set of forms just to stay in the program. For example, Riverside County's proposed application would require a family of three to submit at least 15 pages of documents to continue their benefits.
The California Endowment, which gave the state $26.5 million last year to help bring newly eligible state residents into Medi-Cal, offered $6 million this year for grants to community groups to guide recipients through the new renewal process. The money would be doubled by a matching grant from Washington. Nevertheless, the Brown administration argued that the counties, which have a huge backlog of Medi-Cal applicants, don't need the help. That's so absurd, it seems like a cynical pretext for cutting Medi-Cal costs by reducing enrollment.
It's reasonable to ask Medi-Cal recipients to prove that they're still eligible for the aid, guarding the public against fraud and reserving Medi-Cal for the neediest residents. But it's just as important not to let the new paperwork requirements cause people who are truly eligible for Medi-Cal to lose their coverage. That kind of churn doesn't save the state money in the long run. When the poor no longer have insurance, they lose access to preventive and coordinated care but not to costly treatments at hospital emergency rooms. State Sens. Mark Leno (D-San Francisco) and Ed Hernandez (D-West Covina) have proposed a bill to take up the California Endowment's offer, and lawmakers should pass it.