California budget deficit could mean big Medicaid cuts

Monday, May 26, 2003

May 27, 2003

SACRAMENTO, Calif. - To help close a $38 billion budget deficit, California Gov. Gray Davis has proposed eliminating Medicaid DME/medical supplies benefits for anyone 21 or older who is not in a skilled nursing facility.

The state spends about $70 million a year on that population.

“It’s not going to happen,” said Bob Achermann, executive director of the California Association of Medical Product Suppliers (CAMPS). “Who has the stomach to do that? I think the legislature will reject that - but that there is more.”

By “more”, Achermann means that the legislature is considering: 1. Cutting provider rates across the board by 15%; 2. Dropping the reimbursement rate for unlisted custom wheelchairs and accessories to the Medicare rate or MSRP minus 20%, which ever is less. California Medicaid currently reimburses customer wheelchairs as MSRP; 3. Reimbursing DME at 80% of the Medicare rate for listed items. The state now reimburses most DME at the Medicare rate.