Medi-Cal & Primary Care Payments

July 3, 2013

With the expected increase in Medi-Cal enrollment in January 2014, California’s healthcare providers will see from 600,000 to a million new Medi-Cal patients. As the state prepares to implement the controversial 10% reduction in Medi-Cal payments, it will be challenging for some providers to treat both current Medi-Cal patients and the expected new enrollees. California’s physician payments are already among the lowest in the nation.

The reductions will not only affect physicians, but dentists, and other health care professions as well. This could be devastating for the underserved Medi-Cal population and may further limit their access to providers, and create a greater barrier for those private physicians who provide care to Medi-Cal patients. The question still remains for state policy makers, how will current Medi-Cal and over 1 million new patients receive treatment from private doctors and how will children access dental services.

California is one of the leading states that has opted to embrace the Medicaid expansion and implement expanded health care coverage. The timing for the Medi-Cal rate cuts could not have occurred at a more inopportune time, as California is preparing for up to one million new enrollees joining the program.

According to state officials, the 10% decrease was necessary to control healthcare spending during the recent recession that severely reduced state revenues. However, for those impacted, the expected cuts are retroactive from 2011, so providers will retroactively owe a two-year 10% cut. The cuts are projected to save the state $459 million in the fiscal year that started July 1.

At the same time, the Affordable Care Act is scheduled to increase Medi-Cal payments to doctors for primary care services up to the Medicare rates. This will be retroactive to January 1, 2013. The anticipated payment increase was scheduled to begin earlier this summer and has now been delayed until the fall of 2013 – new Medi-Cal enrollment begins October 1 and coverage begins January 1, 2014.

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