Jerry Brown dropped a significant little factoid into his state-of-the-state/inaugural address to the Legislature this month.
Noting that California had fully embraced the expansion of medical insurance known as Obamacare, including the option to expand access to Medi-Cal, the state’s health care program for the poor, Brown added, “The state will enroll 12.2 million people during this new budget year, a more than 50 percent increase.”
It is, he continued, “the right thing to do, but it isn’t free.”
The federal government is initially footing the bill for much of Medi-Cal’s expansion, but state costs are rising and, Brown says, “will run into the billions.”
Those 12.2 million Medi-Cal recipients, one should note, are almost a third of the state’s 38 million residents. The fact that so many Californians qualify is a statistical clue to the state’s evolution into a two-tier society.
The costs, as Brown warned, will be immense and will compete with a multitude of other demands for state funds, ranging from schools to colleges to state employee salaries.
That said, California’s spending on Medi-Cal, however immense it is and will be, could be too little because adding so many to the rolls of the medically insured puts a massive strain on our health care delivery systems.
Gaining Medi-Cal coverage is one thing, while obtaining care is another, because the state’s reimbursement rates to doctors, hospitals and other providers are among the nation’s lowest.
Obamacare provided a brief “bump” in provider rates, but it is expiring and Brown is refusing to restore previous cuts in the rates that the state decreed during years of fiscal strain. For treating Medi-Cal patients, doctors receive only a fraction of what they get for those covered by Medicare, the health insurance program for the elderly.
Elements of the health care industry that often work at cross-purposes – unions and hospitals, for instance – have formed a new coalition to press for increases in reimbursement rates, saying that otherwise the new recipients will be unable to find the care for which they now have insurance.
When Brown’s budget aides appeared before legislative committees to outline his 2015-16 budget, they were peppered with pointed questions from lawmakers about provider rates, but did not offer any plans to improve them.
Rather, the administration officials said, they would grant case-by-case rate waivers in areas where obtaining care is clearly lacking.
It is a continuation of a philosophy that has permeated California’s public services for decades, whether they are health care, welfare payments, in-home supportive services or higher education slots.
The state makes access to public benefits relatively easy, but keeps their value relatively low – a quantity-over-quality attitude.