Governor Jerry Brown’s updated budget proposal includes more than $1 billion in additional spending on Medi-Cal, yet health advocates are criticizing the governor's plan because it does not restore a 2011 cut the state made to the reimbursement rate for doctors who treat Medi-Cal patients.
"Right now the amount we pay doctors to serve people with Medi-Cal coverage is 49th in the nation," said Anthony Wright, director of the nonprofit Health Access California.
Wright said those low rates discourage doctors from treating low-income patients.
Now that the state budget is emerging from the recession, Wright and other health advocates want Medi-Cal rates restored to pre-recession levels.
But when Brown released his revised budget on Tuesday, he stressed fiscal prudence and competing priorities.
"There’s a lot more things than just Medi-Cal fees, provider rates," Brown said. "There are lots of other ways to spend money."
The $1.2 billion in additional Medi-Cal funding in Brown's latest proposal will cover the state's share of the cost to cover hundreds of thousands of people who have newly signed up for Medi-Cal and whose coverage won't be fully paid by the federal government.
But Wright argued that simply covering those people won’t be enough if it becomes harder for them to see a doctor.
A study by the California Healthcare Foundation found that while about 90 percent of doctors in California treat patients on private insurance, only about 60 percent treat Medi-Cal patients. The study said the surge in new Medi-Cal enrollments under the Affordable Care Act could make it harder for those patients to find care.
Richard Thorp, the president of the California Medical Association, told KQED that that's because the low reimbursement rates may also drive many providers to stop seeing Medi-Cal-insured patients.
"There’s overhead costs and employee costs, and just running the business costs," Thorp said. "So when you’re getting paid significantly less than it costs to actually keep your business open, there’s a certain amount of that where you can’t just continue to do that."
On Wednesday, State Senate Pro Tem Darrell Steinberg (D-Sacramento) said restoring Medi-Cal rates is important, but he stopped short of calling it a top priority in his upcoming negotiations with the governor over the budget.
"That’s on the list," Steinberg said. "Can we afford it? I don’t know. I don’t know at this point."
Health Access California estimates that restoring the earlier Medi-Cal rates would cost the state about $250 million. Wright said his group and others will be pushing the legislature to restore the rates as it finalizes the state budget in the coming weeks.