Medi-Cal Expansion Floated as New Policy Shift for California

Posted on 13 December 2012

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By Christopher Allen
California Progress Report

Yesterday, the Los Angeles Times published an editorial on expanding the Medi-Cal program as a way to help California meet, or exceed, the requirements of the 2010 health care reform law now being phased into effect. Since part of the Affordable Care Act's primary purposes was to extend health coverage to the uninsured, the 2010 law requires states to find a way to add low-income individuals to the rolls of the insured. In most states, this would be done through the federal Mediaid program, with individuals earning less than 133% of the federal poverty line - or, effectively, 138% due to new methods of calculating eligibility - being covered under the new system.

The Times argues that expanding Medi-Cal to do this in California would be a win-win for the state and its residents:

Expanding Medi-Cal would be a boon to providers that treat a large number of the uninsured and to county health programs, which now provide insurance (with federal help) to indigent adults without children. But the entire healthcare system would benefit too. Fewer uninsured patients means fewer costly trips to the emergency room. Doctors and hospitals would have fewer unpaid bills, and those with insurance would absorb less of those costs. And giving more people access to immunizations and other preventive care should improve public health and productivity.

State Insurance Commissioner Dave Jones has echoed this opinion in an op-ed at the San Francisco Chronicle, pointing out, as the Times did, that the federal government would pay for the entirety of the expansion through 2017, and that the state would only need to fund 10% of the new cost after that. He also argues that this is an opportunity to shift an existing cost to California society on to the books where federal money can be used to mitigate the cost to Golden State policyholders:

The simple fact is Californians are already paying for the uninsured - without any help from the feds. Right now, every uninsured Californian is paying annually about $500, and each family is paying approximately $1,400, in extra health insurance premiums to cover the uninsured. Because the uninsured often get their health care through hospital emerency rooms - where the cost to provide care is much higher - those costs are shifted by the hospitals to the health insurers, who then shift the cost to policyholders.

Meanwhile, Kevin Yamamura at the Sacramento Bee also reported that lawmakers are now looking at ways to restore funding to social programs gutted during the depths of the recession, including expanding Medi-Cal to help deal with the state's rising number of uninsured or under-insured citizens, not that "the buzzword around Democratic circles these days is 'investment.'"

However, Yamamura also reports that there are concerns within the Brown administration that California must not be reliant upon federal support to continue social programs, such as a Medi-Cal expansion, after 2017. And with a budget deficit still looming for the state, the restoration or expansion of many social programs is still very much up in the air.

Nonetheless, there seems to be at least a growing discussion supporting the realigning of Medi-Cal as a stronger structure through which the state could deal with its uninsured in the new health care framework.

Medical is too expensive. Low-income people don't need to be given insurance; they only need medical care. That could be obtained at public hospitals or clinics.It would save billions nationwide. As it now, poor people receive better government paid insurance (Medical)than many working people can afford. A typical family has to pay about $16,000 a year for insurance that will provide what people on Medical get free.