Legislature Deals Fatal Blow to Trial Medi-Cal Program

If the state’s experimental Medi-Cal program, called Expanded Choice, were to be given a proper burial, the date of death on the tombstone would read June 8, 1986.

The proposed health delivery plan officially died that Sunday afternoon after six legislators, who had been bombarded with hundreds of telegrams, letters and phone calls from opponents, voted to kill the project during a budget conference committee meeting.

The plug was pulled about a year after the state’s California Medical Assistance Commission proudly unveiled Expanded Choice, which would have drastically altered the way 250,000 Medi-Cal recipients in the San Fernando Valley and San Diego County receive their health care. At that time, John Silberman, then the commission’s chairman, boasted that the proposed Medi-Cal system would become a “model for the nation.”

Expanded Choice would have required most Medi-Cal recipients to receive their medical care from health maintenance organizations.

In January, the Valley’s experiment was postponed until at least 1987 after its creators decided to wait and see whether the San Diego prototype would work. But the San Diego experiment never got off the ground.

While the state remains committed to seeking ways to lower Medi-Cal costs, the prospects of a comeback for the controversial pilot project seem bleak.

The participating health plans, which lost millions of dollars in start-up capital, are angry and incredulous regarding the state’s future commitment.

“There is profound disillusionment that the state would lead us down the path and then abandon us,” said Norman Greene, spokesman for San Diego’s Mercy Hospital and Medical Center, which formed a health plan.

“I would find it very hard to believe that all 10 (San Diego) plans that worked so hard to meet the state’s rigid requirements . . . would be willing to do it again without ironclad assurances and funds to pay for the incurred expenses,” Greene added.

Also one of the experiment’s skeptics, Assemblyman Burt Margolin (D-Los Angeles), who heads the Joint Committee on Medi-Cal Oversight, has promised that any attempt to revive Expanded Choice in any form will be rigorously scrutinized by the Legislature.

The Legislature gave the state authority to devise an experiment like Expanded Choice in 1982 when lawmakers, facing a fiscal crisis, were eager to find a cheaper way to provide health care to the poor, elderly and disabled. When officials with the medical assistance commission and the Department of Health Services concluded that they had devised a plan to cut costs by 5% and provide better physician access to patients, the most enthusiastic cheerleaders were Gov. George Deukmejian and David B. Swope, then health and welfare secretary.

So what happened?

In the final analysis, the Valley and San Diego experiments failed for dramatically different reasons--one was the victim of politics, and the other failed because of a lack of cooperation in the medical community.

“The biggest problem in the Valley was that we didn’t have all the providers we needed,” said John Rodriquez, the health services department’s deputy director of medical care services, who is in charge of the state’s Medi-Cal programs.

State officials were shocked by the savvy grass-roots opposition they encountered in the Valley, which never materialized to the same degree in San Diego. Activists representing the developmentally disabled, the deaf, the elderly, the speech impaired, the brain damaged and others formed a coalition to kill the experiment.

After the Valley experiment was postponed, Valley legislators took steps to make sure the state would never implement Expanded Choice.

Assemblyman Richard Katz (D-Sepulveda) and state Sen. Alan Robbins (D-Van Nuys) got language inserted in the governor’s 1986-1987 budget that would have prevented the medical assistance commission from using any of its funds to start the program in the Valley. And Assemblyman Tom Bane (D-Tarzana) introduced a bill that would have prevented the state from forcing the disabled, elderly and blind in the Valley and San Diego into the program.

The chances of success were considered much better in San Diego. Many of the largest HMOs, including the Greater San Diego Health Plan, Kaiser Foundation Health Plan and Ross-Loos Health Plan of Southern California, had agreed to participate, and 70% of the doctors presently treating Medi-Cal patients had signed up.

The 10 participating HMOs had invested at least $3 million in the program and were preparing to accept their new patients next October. Last week, notices were to have gone out notifying recipients that they had three months to choose one of the HMOs.

Apparently last-minute developments in Sacramento, however, doomed the project.

Perhaps most important of these was that the powerful California Medical Assn., which rarely loses a battle in the Legislature, ultimately made the elimination of Expanded Choice one of its top priorities. San Diego pharmacists and their national association also vigorously lobbied against it.

Dr. Joseph W. Joyner Sr., a San Diego pediatrician with several thousand Med-Cal patients, encouraged his patients’ mothers to contact the legislators. Other doctors did the same.

A second highly important development was that state health officials privately said that the governor no longer viewed Expanded Choice as a priority.

Sen. John Seymour (R-Anaheim), a committee member, observed, “The Administration did not lobby real hard. Had they really put the full-court press on it, I certainly would have sat down and taken another look at the data.”