Medi-Cal enrollment success raises budget issues in California

In his revised budget proposal this month, California Gov. Jerry Brown increased funding for the state Health and Human Services Agency by almost $840 million from what he originally proposed in January, but the state hospital and medical organizations are concerned the new amount will not be enough to cover the increase in the state's Medicaid population.

Before Medicaid expansion under the Patient Protection and Affordable Care Act, there were 7.9 million residents enrolled in Medi-Cal, the state's Medicaid program. In fiscal 2014-2015, that is expected to increase to 11.5 million. Much of this increased cost will be covered by the federal government, but the state general fund will contribute $29.6 billion to the overall $136.7 billion HHSA budget while “other funds” will contribute $107.1 billion.

The California Medical Association lamented how the governor has retained a 10% cut in physician reimbursement that was enacted in 2011 when the state was in a more dire economic situation.

“California has one of the nation's lowest Medicaid reimbursement rates and arguably some of the highest practice costs across the country,” Dr. Richard Thorp, CMA president, said in a release. “While California should be proud for the initial success of enrolling people into Medi-Cal, that alone will not ensure that patients will have access to care.”

The revised budget includes an overall revenue increase of $2.4 billion that reflects higher-than-expected inflows from personal income taxes and other sources. California Hospital Association President and CEO C. Duane Dauner made note of this.

“As California's budget picture continues to improve, lawmakers should do their part by restoring specific cuts that protect the most vulnerable among us, and preserve a basic quality-of-life issue: access to quality healthcare for all,” Dauner said in a release.

The state is expected to enact a final budget next month.

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