Budget Subcommittee Gets an Earful

by David Gorn

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Even before the Senate budget subcommittee started yesterday, chair Mark DeSaulnier (D-Concord) asked the packed chamber for a little indulgence.

"We're about to have a four-hour hearing on what's going to be a very difficult subject," DeSaulnier said.

"So please don't get cranky with the chair," he said, "I just want to make sure everyone gets heard."

The subcommittee's grappling with how state agencies could cut $1.7 billion out of their budgets made the legislative hearing sound more like crisis counseling.

"It pains me to be in this position where we're looking at reductions to these important services in California," DeSaulnier said.

"We're very willing to look at where we might make changes," Health and Human Services Director Diane Dooley said. "I will be available to listen, and to work with you on it."

"This is probably the most difficult task of all the subcommittees," Elaine Alquist (D-Santa Clara) said in agreement. "We're looking at a $26.4 billion budget deficit, so we're going to be doing things we don't want to do."

Over the four-hour hearing, which remained mostly good-humored, there were tears, jibes, drama and a stateful of concern.

A range of major budget cuts were presented at the hearing, including a big one: a 10-visit hard cap on Medi-Cal physician visits. If enacted, California would be the first state in the nation to place hard limits on the number of times Medicaid patients can see a doctor.

Two other states have hard caps in limited circumstances, for hospital and emergency services overuse, according to Toby Douglas, director of the Department of Health Care Services. Some states have introduced a soft cap, where patients need to pre-approve visits after they hit a certain number of them. "And we have had hard caps on adult dental care in the past," he said.

The proposal would require a state plan amendment under federal law. And it didn't sit well with Vanessa Cajina of the Western Center on Law and Poverty.

"For people with chronic conditions, this will have horrible cumulative impacts," Cajina said. "Radiation is given 5 days a week for 6 weeks. That's obviously beyond the limit. And this is a life or death situation."

According to Beth Capell of Health Access California, the analogy to dental care is not applicable, since that is more of an optional service than seeing your physician for a health condition like kidney disease.

"This will kill people," Capell said. "If kidney patients don't get dialysis, they will die. If cancer patients don’t get chemotherapy, they will die. If people don't get their chronic heart disease treated, they will die."

Terri Thomas of the California Association of Public Hospitals and Health Systems said it's ironic that California has built just the kind of health care system that planners of national health reform had in mind -- and now the state is talking about dismantling it.

"We believe this proposal is particularly counter-intuitive," she said. "This runs counter to what's happening with national reform. Many of our patients don’t just have a single condition, they sometimes have multiple conditions." That means they need to see a doctor many times, she said. The hard cap not only hurts patients, she said, but their providers, as well.

"There's no real way to alert providers about the number of visits to various doctors," Thomas said. "So what it amounts to is, care will be provided, but providers won't be reimbursed."

Many other cost-cutting measures were discussed:

  • Mandatory $5 co-pays for health provider visits;
  • A hard cap on the number of prescriptions, limiting Medi-Cal patients to 6 of them a month. There are exceptions to the cap for children, people in nursing facilities, AIDS patients, mental health patients and others where the drugs are deemed life-saving;
  • Mandatory co-payments for pharmaceuticals -- $3 or $5, depending on the type of drug;
  • Mandatory co-payments for inpatient care -- $100 a day for a hospital stay, with a maximum of $200. And $50 for every visit to the emergency room;
  • Elimination of over-the-counter cough and cold products as a Medi-Cal benefit; and
  • One of the big-ticket items: elimination of Adult Day Health Care services.

"We're one of a handful of states that offers adult day health centers," Douglas said. "Under Medicaid rules, some components are mandatory, and some are optional. Given that it is an optional benefit under federal rules, it was one of the things we could cut."

Eliminating ADHC has come up twice before, as suggested cuts by Governor Schwarzenegger. And it was defeated in the Legislature twice before.

"This is our highest priority," Gary Passmore of the Congress of California Seniors said. "We think this is a dishonest budget proposal. This has been very clearly documented that this does not save money. it will cost the state money."

The ADHC program is designed to keep seniors and people with disabilities in their home environments, so they don't have to go to nursing homes or hospitals, he said.

"This was created in California to reduce the costs of long-term care," Passmore said. "This is the budget solution. Not the budget problem. This is not just bad budgeting, but bad budget policy."

Leona Butler
The cap on physician visits doesn't make sense for most Medi-Cal patients since, with the addition of seniors and persons with disabilities to mandatory managed care, almost all persons on Medi-Cal will be in managed care, the responsibility of a health plan, and services will be capitated. Costs can be saved through good management of the capitation amount for each category of patient. Leona Butler

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