Gov. Signs Repeal of Medi-Cal Cuts

Gov. Arnold Schwarzenegger signed emergency legislation Friday to immediately repeal a 5% cut in payments to doctors and other Medi-Cal providers who treat nearly 3.3 million poor and disabled Californians.

The reduction, which took effect New Year’s Day, cut payments to physicians, dentists and home healthcare agencies that treat patients on a fee-for-service basis.

Schwarzenegger said in a statement that savings generated by the new federal Medicare prescription drug program allowed the state to “provide relief for Medi-Cal fee-for-service providers who deliver critical healthcare services to our most vulnerable Californians.”

But the governor also noted that the rising cost of Medi-Cal, now the second-largest spending program in the state budget, demands attention.

He called on the California Medical Assn. and other healthcare providers to work with him and the Legislature to develop “reasonable and responsible Medi-Cal reforms.”

One of those approaches -- shifting seniors and the disabled to managed-care programs -- has met with resistance. About half of the state’s 6.7 million Medi-Cal recipients are already in such programs.

The governor’s signature on the legislation by state Sen. Denise Moreno Ducheny (D-San Diego) won high praise from Dr. Jack Lewin, chief executive of the California Medical Assn.

“It’s a very positive act,” he said. “The cut ... made access to healthcare worse for seniors, the disabled, children and other low-income people dependent on Medi-Cal.”

Lewin said his organization would work with the governor to streamline the Medi-Cal program and improve the quality of care.

But, he said, “we can’t just snap our fingers and say managed care is the answer.”

The 5% reduction won approval from Gov. Gray Davis and state lawmakers in 2003, but the cut was blocked by a federal court order until last summer.

Schwarzenegger and lawmakers then agreed to postpone the reduction until Jan. 1.