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California speaker hopes to expand Medicaid program

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SACRAMENTO, Calif. (AP) — Assembly Speaker John Perez introduced legislation Monday to expand Medicaid in California under the federal Patient Protection Affordable Care Act (PPACA).

The bill could extend Medi-Cal — California’s version of Medicaid, the health care program for the poor and disabled — to include more than 1 million additional people.

At the same time, health care providers escalated their legal fight against the state’s planned cuts to Medicaid reimbursement rates, saying any further reductions to the state’s payments could keep patients from accessing vital care at a time when the state seeks to expand quality coverage for uninsured Californians.

Perez, a Los Angeles Democrat, said the cost of covering the additional recipients is still unknown, but would be paid for by the federal government as part of the health overhaul.

“This legislation is 100 percent covered by the federal government for the first 3 years,” he said at a news conference in Sacramento as the legislature began a special session on health care reform.

Doctors, pharmacies and advocates said Monday that some providers have stopped serving patients who are already enrolled in the insurance program for the poor — called Medi-Cal in California — because the state’s reimbursement rate is so low.

Advocates warned that if the additional cuts go forward, clinics could go out of business and more providers would opt out of caring for low-income patients, just as the state seeks to expand and improve access as part of President Barack Obama’s health care overhaul.

“Patients are the ones who will be hurt if these cuts go through,” said Duane Dauner, president of the California Hospital Association. “Especially at risk are rural and safety net hospitals.”

About 7.1 million Californians currently lack health insurance.

With the new requirement in 2014 that virtually all Americans have health insurance under PPACA, providers believe hundreds of thousands more low-income people will soon enroll.

Perez said his proposal would expand the coverage to people who make up to 138 percent of the federal poverty line, or about $15,400 a year for an individual.

Senate President Pro Tem Darrell Steinberg, D-Sacramento, introduced a similar bill Monday after the special session was convened.

“People need and deserve better health care than what they can get when they’re violently ill in an emergency room,” Steinberg said. “And we also know that investing in coverage, access, prevention and early intervention saves the taxpayers a lot of money.”

Providers, however, have argued for years that taking on new patients will not be financially viable.

Last year, a federal appeals court backed California’s right to cut payments to the Medi-Cal program by 10 percent. State officials at the time said that would save the state more than $330 million each year.

Groups representing doctors, hospitals and pharmacists said they filed a request Monday for a rehearing before the full 9th Circuit U.S. Court of Appeals, rather than a three-judge panel that ruled in the state’s favor last year.

“There is no doubt in my mind that if these cuts are allowed to stand, community clinics will close,” said Tom Hayes, chief executive of Eastern Plumas Health Care, which operates an acute care hospital and medical clinics in rural Plumas and Sierra counties. “Most of our patients are lifelong residents of the area, and to force them to move would be heartbreaking.”

The state’s planned cuts to reimbursement rates would apply only to those hospitals that have skilled nursing units within their acute care facilities, which represents about 25 percent of all hospitals in the state, said Jan Emerson-Shea, a spokeswoman for the California Hospital Association.

Hospitals, which by law must provide emergency care to the uninsured, will increasingly be treating new Medi-Cal enrollees, said Robin Swanson, a spokeswoman for the Assembly speaker. In turn, that could help offset the cost of charity care and ultimately bring down health care costs for all, she added.

Physicians, however, are not required to treat new Medi-Cal patients and could opt out altogether.


Associated Press Writer Don Thompson contributed to this report from Sacramento. Burke reported from San Francisco.