Budget Plan Called Unfair to Poor

Health advocates said Tuesday that Gov. Gray Davis’ plan to balance the state budget would obliterate the safety net for poor adults and have a devastating effect on an already teetering health system.

The governor has proposed cutting $758.3 million in general fund payments for Medi-Cal, which provides medical services primarily to poor children, pregnant women, senior citizens, and blind and disabled people.

Because Medi-Cal is jointly funded by the state and federal governments, the state’s cutback would lead to the loss of an additional $350 million in federal matching funds.

“It’s not reasonable to put the burden of the budget cuts on the backs of the working poor, of the working families,” said Anne Marie Flores, co-chairwoman of the PICO California Project, a faith-based group that advocates increased government support for the poor.

Physicians said their colleagues are likely to stop taking Medi-Cal patients because the average reimbursement rate will fall from $20 per office visit to $16, the same rate as 1985. That is the lowest rate in all 50 states, according to the California Medical Assn.

“I just don’t see how physicians are going to be able to continue to see these patients, unless they get a miraculous increase from someplace else,” said Dr. John Whitelaw, president of the doctors group.

State officials said they could not please everyone with their cuts.

“We’ve had a very rich package of benefits under the Medi-Cal program, and we’ve tried to sustain that as long as we can,” said Grantland Johnson, secretary of California’s Health and Human Services Agency.

“When you’re faced with this daunting revenue shortfall, you have to take measures that you otherwise would not take in better economic times,” he said.

In total, the changes would reduce the Medi-Cal enrollment by 490,600, or about 7% below what Davis had previously estimated, state officials said. The proposed cuts in health care would:

* Postpone an expansion of health coverage for 300,000 adults.

Earlier this year, the Bush administration approved a plan to expand coverage beginning in July for parents of low-income children who are currently eligible for government health programs. The adults involved would be working parents earning up to twice the federal poverty level, which equals about $35,300 for a family of four.

* Postpone “express lane eligibility,” slated to begin July 1, in which the state would have allowed school districts to automatically enroll children in Medi-Cal through the free and reduced lunch program.

* Reinstate procedures in which adults need to fill out forms every quarter to remain enrolled in Medi-Cal. Adults currently need to fill out paperwork annually. Added paperwork has been shown to reduce enrollment in public insurance programs because people forget to re-enroll or consider it too cumbersome.

The state expects this change to remove 247,000 adults from Medi-Cal rolls next year.

* Eliminate dental, chiropractic, acupuncture and podiatry services for adults in the Medi-Cal program.

* Reduce the number of covered dental exams for children from two per year to once a year.

* Increase the income requirements for two-parent families to enroll in Medicaid if their children are enrolled. Families would not be allowed to enroll unless they earn less than 67% of the federal poverty level. Currently, all families earning less than the poverty level are eligible. A family of three would now need to earn less than roughly $9,800 to be eligible.

That would prevent enrollment of 146,000 parents who otherwise would have joined in the next year.

* Increase by $86 million, to $136 million, the fee the state takes from hospitals that provide health services to large numbers of low-income and uninsured patients.

The response from health groups was near-universal disappointment. They agreed that the governor had to make difficult decisions, but said he should have opted to raise taxes or fees in order to spare cuts for the poor.

“It’s an ugly day,” said Anthony Wright, organizing director for the health-reform group Health Access. “We’re going through it [the budget], and it looks very ugly. At the end of the day, children, seniors and working families will not have access to the health care they need under these cuts.”

Hospital officials said the increased take-aways from safety-net hospitals would cause some facilities to close services. The cuts come in addition to $184 million in cuts expected later this year from the federal government.

At Arrowhead Regional Medical Center in San Bernardino County, administrator Mark Uffer said he might have to close nine primary care centers, which attempt to prevent emergency room visits.

“Unfortunately, I think this is a game of chicken,” Uffer said. “You’re taking a system that’s very fragile, and you’re going to make it more fragile, and sooner or later, it’s going to collapse.”

Dr. Dinesh Ghiya, a Whittier pediatrician who sees Medi-Cal patients, said he may drop out if the lower rates are approved.

“I can’t afford to see those patients,” he said. “It costs me at least $35 to $36 to see each patient. If I’m already subsidizing [the cost], it’s going to get worse.”

Dentists likewise complained about the elimination of dental benefits for adults. If adults can’t get their dental exams covered, they are unlikely to take their children to the dentist, said Liz Snow, director of public policy for the California Dental Assn. In addition, she said, poor dental health has been linked to other ailments, including heart disease and diabetes.

“The entire focus of dental care is prevention, and that focus would be entirely eliminated,” Snow said. “That is the devastating approach.”