California officials have notified operators of health care facilities that beginning today, Medi-Cal payments will be on hold until a state budget is approved, the Los Angeles Times reports. Medi-Cal is California's Medicaid program.
The move comes because an emergency fund dedicated to making Medi-Cal payments to health care facilities has been exhausted. The order will apply to nursing homes, health care clinics and other businesses or organizations that California categorizes as a health care "institution," according to the Times.
The 1,200 homes for people with developmental disabilities in California will be particularly hard-hit because the facilities rely on Medi-Cal exclusively for funding, the Times reports.
State law requires Medi-Cal to continue paying private physicians who treat Medi-Cal beneficiaries, and pharmacists also will continue receiving reimbursements.
Many organizations affected by the payment freeze are using their reserves or working to secure loans from banks and foundations to maintain operations.
However, the Times reports that the facilities might face steeper costs on loans this year because banks are more reluctant to offer bridge loans to the facilities (Halper, Los Angeles Times, 7/24).
Meanwhile, more than 500 people attended a meeting at the Oakland Asian Cultural Center on Wednesday to discuss Gov. Arnold Schwarzenegger's (R) proposed changes to Medi-Cal as part of his fiscal year 2008-2009 budget plan, the Oakland Tribune reports.
Assembly member Lori Hancock (D-Berkeley) and representatives of outgoing Senate President Pro Tempore Don Perata (D-Oakland) answered questions at the event (Hill, Oakland Tribune, 7/23).
"Getting out of California's chronic budget hole will be a painful process, and cuts in health care and other essential services are going to be necessary," but it is important to consider the implications of those cuts, a Fresno Bee editorial states.
"The cuts in Medi-Cal reimbursements are a case where an exception to the across-the-board approach should be made for rural hospitals and clinics," the editorial states, adding that the cuts could undermine rural health care facilities and further weaken the rest of the health care system (Fresno Bee, 7/22).