Schwarzenegger Declares Fiscal Emergency and DHMC Not Listening to Complaints

Thu Dec 16 13:04:22 PST 2010

December 7, 2010
Schwarzenegger Declares Fiscal Emergency, Unveils Deficit Fix

California Healthline

On Monday, Gov. Arnold Schwarzenegger (R) declared a fiscal emergency  
on the first day of a special legislative session to address  
California's estimated $6 billion budget shortfall for the current  
fiscal year, the Sacramento Bee reports
(Yamamura, Sacramento Bee, 12/7).

Schwarzenegger also released a new proposal designed to reduce the  
state's
deficit by about $9.9 billion over the next 18 months. The plan aims  
to decrease
the current fiscal year's shortfall by $1.9 billion and reduce next  
fiscal
year's estimated deficit by nearly $8 billion (Miller, Riverside Press- 
Enterprise, 12/6).

If California lawmakers fail to take action on the budget, the state  
deficit is
expected to reach $25.4 billion by the end of the 2011-2012 fiscal year
(Buchanan, San Francisco Chronicle, 12/7).

Health Care Cuts Included in Governor's Plan

Schwarzenegger's new budget plan calls for $7.4 billion in spending  
reductions,
primarily targeting health and human services programs. The proposal  
also would generate $2.5 billion through funding changes and other  
revenue. The governor's budget plan would cut funding from Healthy  
Families, California's
Children's Health Insurance Program, by:

	* Increasing monthly premiums to reduce spending by $31.2 million;
	* Eliminating vision coverage to reduce spending by $13.6 million; and
	* Raising copayments for emergency department visits to reduce  
spending 	by $6.8 million.

Schwarzenegger's proposal also would cut nearly $984 million in  
spending on
Medi-Cal, California's Medicaid program, by:

	* Capping payment on hearing aids and other medical equipment;
	* Limiting prescriptions to six per month, except in certain cases;
	* Restricting physician visits to 10 annually;
	* Imposing new copayments for physician visits, ED visits and  
hospital 		stays;
	* Eliminating Medi-Cal coverage for newly qualified immigrants; and
	* Ending optional adult day health care benefits.

Schwarzenegger's plan also aims to reduce state spending by $1.4  
billion by
eliminating CalWORKS, California's welfare-to-work program, effective  
July 1,
2011 (AP/San Jose Mercury News, 12/6).

Legislators Unlikely To Act on Proposal

Schwarzenegger declared the fiscal emergency and released his new budget
proposal on the same day that the newly elected class of legislators  
were sworn
in. Lawmakers are required to take action on budget proposals within  
45 days of the declaration of a fiscal emergency.

However, many lawmakers are expected to hold off on budget  
negotiations until
Gov-elect. Jerry Brown (D) takes office, which will be about two weeks  
before
the end of the 45-day period.

Before Schwarzenegger publicly released his new budget plan, Assembly  
Speaker John Pérez (D- Los Angeles) recessed the Assembly and told  
them to return on Jan. 3, the day that Brown will be sworn in as  
governor (Herdt, Ventura County Star, 12/6). Senate President Pro  
Tempore Darrell Steinberg (D-Sacramento) also said he would prefer to  
work on a midyear budget correction with the new governor (Harmon,  
Contra Costa Times, 12/6).

Brown Gearing Up for Budget Work

A spokesperson for Brown declined to comment on Schwarzenegger's  
proposal (Woo, Wall Street Journal, 12/7).

Brown has invited state legislators and local government officials to  
attend a
Wednesday meeting on the state's budget challenges (Goldmacher, Los  
Angeles Times, 12/7). State law requires Brown to present his own  
spending plan by Jan. 10 (Ventura County Star, 12/6).

November 16, 2010
DMHC Not Listening to Complaints?
California Healthline

by David Gorn

What if you gave a legislative oversight hearing, and the object of  
that hearing didn't show up?
That was the case last week, when the Budget Subcommittee on Health  
and Human Services conducted an oversight hearing to deal with  
complaints about the Department of Managed Health Care. Emergency  
department officials, who feel they've been grossly and routinely  
underpaid by some insurance organizations, say the DMHC is supposed to  
adjudicate those conflicts, but has instead been ignoring them.

"This is extraordinarily disrespectful. I'm extraordinarily displeased  
they decided not to participate," Assembly member Dave Jones (D- 
Sacramento) said.

"I have been in this Legislature for six years now, but I have yet to  
see a circumstance where senior officials of an administration refuse  
to participate in a legislative oversight hearing, as was the case  
here," said Jones, the newly elected insurance commissioner of  
California.

An official at the Department of Managed Health Care who spoke on  
background said the department needs time to work out answers to some  
of the complaints that have been raised, and it hopes to meet with the  
subcommittee in January.

When Jones learned from the governor's office that DMHC officials  
would not be able to attend, he tried to reschedule the hearing but  
Jones said he was refused.

To emergency physician Michael Forman, who flew in from Oceanside,  
near San Diego, this was par for the course.

"We all complain and we get no response," Forman said. "As insurance  
companies get more brazen and pay us less and less, the ability to  
have a small-business model is getting worse and worse. When we don't  
get paid, we have to make the staff skimpier and skimpier, so patients  
have to wait and wait."

According to Andrea Brault, a physician representing the state chapter  
of the American College of Emergency Physicians, most of the HMOs are  
pretty good about emergency department payments, but some of the  
delegated payer models routinely down-code procedures, she said, or  
don't pay at all.

"It's at this level that we're having tremendous difficulty," Brault  
said.

Jones is drafting a letter to the DMHC. When he takes over as  
insurance commissioner in January, he said he expects to be dealing  
with that agency on a regular basis.

Anna Parks &
Brian Potts MD, MBA
Managing Editors, CAL/AAEM News Service
University of California, Irvine

Contact us at: calaaem.news.service1 at gmail.com

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