As the costs of healthcare increase and our state continues to face a budget crisis we knew at some point certain types of cuts were going to come. Now we have more of the details. As reported by the LA Times, California plans to reduce rates by 10% to many providers, including physicians, dentists, clinics, pharmacies and most nursing homes, the Centers for Medicare and Medicaid services announced.
The cuts “will have a real impact on Medi-Cal patients” because fewer doctors will be willing to see those covered by the program, which serves 7.6 million poor and disabled Californians, said Anthony Wright, executive director of Health Access, a consumer group. The head of the California Medical Assn., which represents doctors, echoed the concern.
Cindy Mann, deputy administrator of the Centers for Medicare and Medicaid Services, told reporters the action gives California the flexibility it had requested to address its budget shortfall. “We know that the reductions that are being approved today will have significant impact on affected providers, and we regret the very difficult budget circumstances that have led to their implementation,” she said.
The California Medical Assn. expressed frustration over the new cuts, saying that physicians could receive as little as $11 a visit. Doctors will have no choice but to stop seeing Medi-Cal patients, said CEO Dustin Corcoran. “You can’t pay the bills at these rates,” he said. “They are unconscionably low.”
Medi-Cal has a myriad of programs. I’m most familiar with Medi-Cal Long Term Care. It deals mostly with skilled nursing facilities which, according to the LA Times article will also receive cuts. While we can’t control the cuts and may or may not feel badly for the providers being directly affected by this action, we do have control with how we plan as we age.
As there are many Medi-Cal programs there are also a myriad of methods to deal with future long term care costs. Certainly Long Term Care Insurance is one. For those of the middle class that do not have such insurance, Medi-Cal planning is the alternative of choice. Veterans Benefits planning is another option. These planning options often involve transfering assets to special types of trusts to gain eligibility.
Currently there is a 30-month look back period for any assets transferred in an attempt to qualify for Medi-Cal benefits. That look back period is going to be extended to 5 years. When? Well, the state law (required by the Federal Deficit Reduction Act of a number of years ago) was passed but specifically indicated that it would not go into effect until the regulations implementing the law were passed. That was supposed to occur a few years ago, then last year, then this year, and now next year. In other words, no one knows for sure. What we do know is that the law indicates that action taken now will be grandfathered and that action taken after the new law is effective will be more difficult than action taken now!