Terminator eliminates further cuts

Wednesday, June 30, 2004

SACRAMENTO, Calif. - After a year of bad news, California Medicaid providers received some good news in May when Gov. Arnold Schwr-zenegger eliminated a plan to reduce reimbursement by 10% across the board.

“I think he really is the terminator,” said Bob Achermann, executive director of the California Association of Medical Product Suppliers.

Last year, California’s Medicaid program, Medi-Cal, slashed DME reimbursement by millions, including reducing payment for power wheelchairs from MSRP to 80% of MSRP.

An increase in revenue during the first five months of 2004 allowed the governor to scale back planned reductions in healthcare programs for fiscal year 2005, which begins July 1.

As part of last year’s budget, then Gov. Gray Davis approved a 5% across-the-board cut in provider reimbursement that would have saved the state $462 million. A federal judge ruled that the state could not legally reduce the rate it pays providers to care for Medi-Cal beneficiaries. The Schwarze-negger administration is appealing the decision.