State budget stalemate squeezes providers

Sunday, August 31, 2008

SACRAMENTO, Calif.--Medi-Cal, the Medicaid program for California, has stopped paying providers because lawmakers haven’t been able to hammer out a state budget.

“The last check write was July 26,” said Bob Achermann, executive director of the California Association of Medical Product Suppliers (CAMPS). “There will be no more money until the budget is adopted.”

California has been without a budget since July 1, as lawmakers try to close a $17 billion budget gap. In February, Gov. Arnold Schwarzenegger proposed cutting Medi-Cal provider rates 10% to help bridge that gap.

Healthcare providers have been lobbying to get the cut repealed, but a hoped-for injunction against the cut was denied July 29.

“We’re looking at other legal avenues, but it’s not looking good,” said Achermann. “We’re not winning.”

A Democratic version of the budget would repeal the 10% pay cut.

Achermann expects most providers will continue to serve their Medi-Cal patients.

“It’s not easy to stop doing business in the healthcare delivery system,” he said. “You can’t just leave these patients to their own devices.”