Reduced Costs Questioned in Medi-Cal Pilot HMO Project

Times Staff Writer

A member of a state commission overseeing the implementation of a controversial Medi-Cal pilot project said Wednesday that the experiment probably will not cut the state’s Medi-Cal costs.

“I don’t think we’ll save one nickel, but I think if we’re successful we’ll prevent the costs from going up,” said Nick Starr, one of seven members of the California Medical Assistance Commission.

However, that is not what state officials were saying in June when they unveiled the program. The commission announced that it expected to trim Medi-Cal costs in the Valley by 5% annually and cited that as one of the main reasons for the experiment. Last year the state spent $7.6 million to provide health care to Valley beneficiaries.

Public Hearing


Starr made his comments after a public hearing in Burbank on the pilot project, which will dramatically change the way most of the 87,000 Medi-Cal recipients in the San Fernando Valley receive their medical care.

During the meeting, Michael W. Murray, executive director of the commission, similarly announced that he “would not anticipate large savings” from the program.

State officials now are de-emphasizing the savings and instead emphasizing another chief aim of the program--providing quality care to poor people who they say have been denied access in the past because most doctors do not accept Medi-Cal patients.

At the hearing, a steady stream of speakers urged the state to scrap the experiment or at least delay it until dozens, if not hundreds, of questions about it are answered.


Safeguards Questioned

Among those questioning the readiness of the pilot project scheduled to begin in January was a spokesman for another branch of the state government that represents all the developmentally disabled in the state. Carolyn Eddy, a representative for the state Developmental Disabilities Area Board in Los Angeles, said the program is missing safeguards that would ensure that beneficiaries receive acceptable health care.

Eddy and several others at the hearing asked the commission to set up an ombudsman program to investigate complaints that recipients might have about all aspects of the program.

“Such an outside grievance panel is a key link in the assurance of quality of care,” Eddy said.


Under the program, dubbed Expanded Choice, most of the Medi-Cal beneficiaries in the San Fernando Valley and 165,000 beneficiaries in San Diego County will be required to enroll in a participating health maintenance organization as of Jan. 1. Starting April 1, beneficiaries will no longer be able to see their own physicians or such other health care providers as speech pathologists, or to get prescriptions filled by their neighborhood pharmacists.

Organized Opposition

As the starting date for Expanded Choice draws nearer, the feeling of disbelief at first experienced by those who favor the status quo in the Medi-Cal program has evolved into organized opposition. Twenty professional, civic and social organizations, which say they represent a million people in the state, formed a coalition last week in the Valley to block Expanded Choice.

Barbara Samuels, one of the coalition’s organizers and the director of the Center for Communication Disorders in Canoga Park, told the commissioners: “We are not out to modify but to stop Expanded Choice. We feel Expanded Choice is bad health care.”


The commissioners were bombarded with many suggestions offered by about two dozen people who spoke against various aspects of the pilot program. The 100 or so people who attended represented such groups as the elderly, the developmentally disabled, the blind, nursing home owners, pharmacists and physicians. No one spoke in favor of the experiment as proposed.

Jim Foley, director of the Valley project, said many of the concerns raised at the hearing were being reviewed in Sacramento but that many answers would have to wait until the commission announces next month which HMOs it has tentatively selected to participate.

“The commission feels . . . the design of the program can respond to many of the concerns and issues raised,” Foley said.

Among those speaking at the hearing were several Medi-Cal beneficiaries who relied upon wheelchairs and crutches to get to the microphone. The room grew quiet when some of them told their stories.


Oscar Kessler, who has diabetes and many other medical problems, pleaded with the commission to let him keep the physician who he said has saved his kidney and provided treatment that has forestalled amputation of a limb.

“I don’t think these rights should be taken from me, the right to choose a doctor that is saving my life,” Kessler said.

The commissioners did not comment on Kessler’s plight, but later, Starr said, “We sit there stone-faced and don’t say anything back, but that doesn’t mean we were not impressed with what we hear. . . . The beneficiaries’ complaints were overwhelming.”

Starr said some people with complicated disabilities who would suffer by switching doctors will receive an exemption. The guidelines on who will be eligible for an exemption, however, have not been completed, he said.


Assemblyman Richard Katz (D-Sepulveda) will hold a public hearing on Expanded Choice at 9 a.m. Nov. 15 at the Sepulveda Recreation Center, 8801 Kester Ave., Sepulveda.