California Gov. Arnold Schwarzenegger announced plans to cut Medicaid payment rates to physicians 5% Jan. 1 in a controversial move designed to save the state $60 million in 2006. Administration officials say the cut is needed to keep the state's budget in balance. The California Medical Association contends it will damage the state's already fragile Medicaid program, known as Medi-Cal, by reducing the number of physicians willing to treat the program's 6.5 million enrollees. The state Legislature authorized the 5% cut in 2003, but the CMA won a federal court injunction blocking implementation. The 9th U.S. Circuit Court of Appeals in San Francisco overturned the injunction in August. The CMA has launched an aggressive lobbying effort and said it plans to sponsor emergency legislation to stop the cut. California already has among the lowest Medicaid reimbursement rates, and as of 2003, 45% of the state's doctors refused to accept Medi-Cal patients, according to the California HealthCare Foundation. -- by Laura B. Benko
Calif. to implement 5% Medicaid cut for doctors
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