Medi-Cal Cuts Affect the County 2/27/13

Sierraville – A meeting called by the Republican Central Committee and the Democrat Central Committee of Sierra County was held on Monday February 25 to address the looming devastating impact to Sierra and Plumas County’s hospital and skilled nursing facility in Loyalton.

The room overflowed at the Sierraville School building and had to be moved into the gymnasium to accommodate concerned residents.

Overflow audience moved to the Gym

Overflow audience moved to the Gym

Director of Health and Human Services, Janice Maddox gave a good overview of the meeting. – Monday’s meeting in Sierraville regarding the possible closure of the Skilled Nursing Facility was a bi-partisan and bi-county effort hosted by local Democrat and Republican parties. The meeting was attended by both Sierra County and Plumas County supervisors. In attendance were Peter Huebner, Lee Adams, Paul Roen and Jim Beard. Scott Schlefstein was unable to attend. Plumas County was represented by supervisors Jon Kennedy and Lori Simpson. The meeting was well attended by both Plumas County and Sierra County residents including Tom Hayes, CEO of Eastern Plumas Health Care. Attendees were provided an update on the current status of the fight to prevent Medi-Cal cuts and  an overview of the history of the cuts.

A brief history of the cuts:

In 2011 Governor Brown approved a 10% cut in Medi-Cal rates which was passed by the Legislature. The CMS branch of the Federal Health and Human Services agency (CMS – Centers for Medicare & Medicaid Services) approved the decrease in California Medi-Cal rates in their role as the entity that approves state Medicaid plans in the context of approving disbursement of Federal funding to states for healthcare. An injunction was placed against these cuts taking place in the context of an appeal that was filed claiming these cuts were illegal as they denied access to people who are entitled to the services in violation of federal and state regulations. We haven’t heard much about these cuts since they were implemented in 2011 as people were waiting to see what would happen with the appeal. In the meantime, impacted medical providers continued to be reimbursed at the pre-cut rate. The outcome of the appeal was that the court decided the authority to make the decision as to whether or not the cuts were acceptable was at the discretion of the Federal HHS agency (CMS). Now the cuts are retroactive to the time they were first implemented in 2011, meaning now medical providers owe a lot of money. EPHC is stating they will have to repay (to my memory) at least 2.4 million and that thereafter their SNFs will be unsustainable with the money owed and an ongoing cut in future reimbursements.  There is some conflicting information being circulated, and I’m still working on clarifying different versions. Some publications state the cuts were implemented at 10% to everybody impacted. Some sources cite skilled nursing facilities being cut at a higher rate. At the meeting Tom Hayes stated the cuts only applied to skilled nursing facilities that are connected to hospitals, not skilled nursing facilities that are no associated with a hospital. There were various reasons presented as to why it would not be feasible to disassociate the skilled nursing facility from EPHC to avoid the cuts, including the fact upon change of ownership the facility would need to meet current zoning standards.

Good news is Assembly Member Luis A. Alejo (D-Salinas) very recently introduced AB 900 to stop the proposed budget cuts to Medi-Cal reimbursements for medical services provided by hospital-based nursing facilities (see attached). That is a hopeful development. At the meeting all were encouraged to contact state representatives to support AB 900 and to protest the discussed cuts. Eastern Plumas Health Care (EPHC) stated they would post contact information for state representatives to facilitate community response and encouraged those in attendance to contact representatives directly and to contact as many representatives as possible (not just local representatives). That information was to be posted at EPHC.org.

(For the Brown Act record, Supervisors Peter Huebner and Paul Roen did not participate in the meeting but merely observed.   RCRC is not connected to CSAC   but is a completely separate entity. Regardless, there is strength in numbers and it is an important organization for rural representation.)

There was some discussion of various lobbying organizations and associations that are part of this effort, including the Regional Council on Rural Council (RCRC) where we are well represented by Lee Adams [RCRC is a branch of the California State Association of Counties (CSAC)] and the state hospital association.

Plumas County Supervisors Lori Simpson and John Kennedy, Sierra County Supervisor Jim Beard, Tom Dotta and CEO of EPHC Tom Hayes

Plumas County Supervisors Lori Simpson and John Kennedy, Sierra County Supervisor Jim Beard, Tom Dotta and CEO of EPHC Tom Hayes

DCC Chair Cindy Ellsmore, Loyalton City Council Member Pat Whitley, H&HS Director Janice Maddox, Brooks Mitchelland Supervisor Lee Adams

DCC Chair Cindy Ellsmore, Loyalton City Council Member Pat Whitley, H&HS Director Janice Maddox, Brooks Mitchelland Supervisor Lee Adams

Tim Beals, Tim Holabird and Don Russell listen alertly

Tim Beals, Tim Holabird and Don Russell listen alertly

Sheriff John Evans and Supervisor Peter Huebner pay attention

Sheriff John Evans and Supervisor Peter Huebner pay attention

Bill Introduced to Restore Medi-Cal Reimbursement Rates

(SACRAMENTO)— Assemblymember Luis A. Alejo (D-Salinas) introduced AB 900 to stop the proposed budget cuts to Medi-Cal reimbursements for medical services provided by hospital-based nursing facilities also known as Distinct Part/Skilled Nursing Facilities (DP/SNFs).

“Hospital-based nursing facilities care for patients of greater medical complexity and are often the only option for patients with specialized medical or behavioral needs or for individuals living in rural areas,” says Alejo. “The proposed cuts to Medi-Cal reimbursement rates will force a majority of them to close or reduce services, which would jeopardize essential medical care for patients and entire communities. This bill would restore Medi-Cal reimbursements rates to levels adequate to continue to provide quality care”

In 2011, The California Legislature passed and Governor Brown signed AB 97, which included a 10% across-the-board Medi-Cal provider rate reduction. In response, several healthcare organizations filed a lawsuit, forcing the administration to stop the implementation of the cuts. In December 2012, a federal appeals court affirmed California’s right to cut payments made to Medi-Cal providers.

“The 2013-2014 Governor’s budget proposal intends to move forward with the Medi-Cal reimbursement cuts, which will result in an average effective rate decrease of 25% for hospitals that operate skilled nursing facilities.  In addition, the Medi-Cal cuts will be retroactive to June 1, 2011,” says C. Duane Dauner, President and CEO of the California Hospital Association. “If these cuts are implemented, access to care for thousands of elderly, frail patients will be compromised, and some rural or safety net hospitals may be forced to close.”

“This bill eliminates planned reductions in access to long term nursing home care services for our most fragile senior community residents by many rural providers such as Hazel Hawkins, which are already struggling with other Medi-Cal and Medicare cuts,” says Ken Underwood, CEO of Hazel Hawkins. “The proposed Medi-Cal rate reduction would impact many small facilities by several million dollars annually, forcing providers to be reimbursed 20% to 40% below their actual cost to provide long term care services, and it will eliminate hundreds of jobs in areas with economies that cannot sustain full-time benefited job losses by the major employers in that community.”

This bill is eligible to be heard after March 22, 2013 in a California State Assembly policy committee.

Luis Alejo represents the 30th District in the California State Assembly, which consists of the Salinas Valley, Monterey County, San Benito County, South Santa Clara County and the city of Watsonville in Santa Cruz County.

 

 

 

 

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