Brown signs bill cutting $1.5 billion in health spending

March 24, 2011

By Daniel Weintraub

One of the budget bills Gov. Jerry Brown signed Thursday seeks to make more than $1.5 billion in cuts to state spending on health care for the poor, mostly in Medi-Cal and the Healthy Families insurance program. Most of the cuts will be achieved by reducing by 10 percent the reimbursement for doctors, hospitals and other providers that care for the poor. The bill will also increase premiums in the Healthy Families program, implement co-payments in Medi-Cal and limit doctor visits and the reimbursement for over-the-counter medication.

The health care bill was among several Brown signed Thursday which together were estimated to achieve about $11 billion in savings, including $8.2 billion in spending cuts.

Among the cuts in health care:

Increased premiums in the Healthy Families insurance program. For families with incomes from 151 percent to 200 percent of the federal poverty level, premiums will nearly double from $16 per month to $30, with a family maximum of $90 per month. For families with incomes above 201 percent of the federal poverty level, premiums will increase from $24 per child to $42 per child, with a family maximum of $126. The budget also increases co-payment for emergency room visits from $15 to $50, while hospital stays would carry a co-payment of $100 a day and a maximum of $200.

Reduced reimbursement for facilities caring for people with developmental disabilities. Rates for these 24-hour care facilities will be reduced by up to 10 percent.

Cap on doctor visits. The legislation limits doctor visits paid for by Medi-Cal to seven per year per person unless a physician certifies that a visit will prevent the need for emergency care, prevent the need for inpatient hospital care, avoid disruption in ongoing medical therapy, or constitutes a diagnostic work-up that would prevent the need for hospital care.

Medi-Cal providers rate reduction. Rates for doctors and hospitals that care for low-income people in Medi-Cal will be reduced by 10 percent.

Long-term care rate reduction. Rates for long-term care facilities that care for low-income people will be reduced by up to 10 percent.

Hearing aids. Caps Medi-Cal spending on hearing aids at $1,510 per person per year.

Non-prescription medications. Eliminates coverage under Medi-Cal for non-prescription cough and cold medicine.

Co-payments. Requires $5 co-payments in Medi-Cal for doctor visits, $3 per prescription for generic drugs and $5 for brand name drugs. Also imposes a $50 co-payment for non-emergency ruse of the emergency room, $50 for emergency room use and $100 per day for hospital stays with a maximum co-pay of $200. The budget also implements a $5 co-pay for dental office visits.

Adult day health care. The bill eliminates adult day care as a service under Medi-Cal and provides funding to transition clients of these programs into other state-funded programs when possible.

The cuts are detailed in Assembly Bill 97. To see the entire bill, go here.

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One Response to Brown signs bill cutting $1.5 billion in health spending

  1. Pingback: Brown Signs Bill Cutting $1.5 Billion in Health Spending « Health Justice Network

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