Medi-Cal is expected to face considerable strain resulting from the expiration of federal stimulus funds, state budget cuts and requirements under the federal health reform law, the Orange County Register reports. Medi-Cal is California's Medicaid program.
Rising Costs
Over the past 10 years, state spending on Medi-Cal has increased by about 40%, rising from about $9 billion in 2000 and 2001 to about $12.7 billion this year.
The total cost of the program -- which is shared between the state and federal government -- is expected to hit about $53 billion this year.
Expiration of Stimulus Funds
In 2009, the federal government increased its share of Medi-Cal spending as part of the federal economic stimulus package. However, that assistance is scheduled to run out in July.
As a result of the expiration of stimulus funds, state spending on Medi-Cal was projected to increase by about 40% to $17 billion next year. However, the projection does not account for spending cuts recently passed as part of a state budget package for the upcoming fiscal year.
Medi-Cal Cuts
State lawmakers recently approved measures to cut Medi-Cal spending by about $1.6 billion.
The program changes will establish new copayments for hospital visits, physician appointments and prescriptions. In addition, the cuts will affect In-Home Supportive Services, mental health programs and other services.
Coming Challenges Under Reform Law
Some advocates have expressed concern that the recent Medi-Cal cuts might jeopardize the state's ability to qualify for assistance from the federal health reform law.
The reform law requires states to expand eligibility for Medicaid programs and provide coverage for certain health services. Although the federal government will reimburse states for most of the costs of implementing the changes, California likely will need to undertake initial improvements to Medi-Cal to qualify for the federal funds (Chaussee, Orange County Register, 4/13).