California Bill Could Increase Payments to Rural Medicaid Providers

A California lawmaker has introduced a bill that addresses payments to providers under the state's Medicaid program, known as Medi-Cal, the Fresno Bee reports. Low payments have prompted some doctors to cut back or eliminate services to Medi-Cal beneficiaries. A 1998 Urban Institute study found that the state's program paid participating doctors about half of what Medicare pays, placing California near the bottom of the 50 states in terms of Medicaid reimbursement rates. In 2000, the state raised Medi-Cal payments by 17%, the first increase since 1985. But Gov. Gray Davis (D) has proposed reducing the Medicaid payment rates by about 50% to trim a $20 billion deficit in the state's budget this year, Steve Thompson, a lobbyist for the California Medical Association, said. To provide some relief to Medicaid providers, particularly those practicing in rural areas, state Sen. Chuck Poochigian (R) has proposed a bill (SB 1644) that would change the way the state Department of Health Services reviews reimbursement rates. Current law requires the department to examine the rates annually and periodically adjust them. Poochigian's measure would require the department to "include an analysis of how the rates affect the accessibility of doctors in rural parts of the state where there are higher concentrations of Medi-Cal patients." Doctors in rural areas often treat a disproportionate number of Medicaid beneficiaries compared with physicians in "more affluent, urban parts of the state," the Bee reports. While a state Senate health committee has unaminously approved Poochigian's bill, it still would face an "obstacle" if passed by the full Legislature in the Department of Health Services, which "[f]or years" has "failed to produce" the reimbursement rate review, the Bee reports. Department spokesperson Lea Brooks said that budget troubles in the early 1990s led to the elimination of members who conducted the reviews. She did note, however, that the state Legislature has the authority to alter reimbursement rates "regardless of when the reviews are conducted" (Maxwell, Fresno Bee, 4/28).