Health Cuts Hearing a Harbinger for Nasty Budget Battle

 In a forestate of the ugly battle over California’s cash-strapped budget, a packed sente hearing room was told by more than 100 witnesses Monday afternoon that the Schwarzengger adminsitration’s proposed cuts in medical services to the poor would be devastating.

While no vote on the reductions was taken by the Senate Budget Committee, the back-and-forth between witnesses, lawmakers and the administration was a good indicator of how sides will align as the Legislature tries to meet a mandatory February 23 deadline set by the GOP governor to cut $872 million from the current year budget, nearly half from public school spending.

At Tuesday’s hearing, administration officials detailed parts of Schwarzenegger’s plan to reduce health and welfare general fund spending by $2.7 billion in the 2008-2009 fiscal year. The reductions would close about one-sixth of the $14.5 billion gap between revenues and spending commitments the state faces, as estimated by the governor’s Department of Finance. 

“We agree these (cuts) will be tough. There will be impacts. (But) we spread the impacts as much as we could,” said Toby Douglas, assistant deputy director of Medi-Cal Services at the state Department of Health Services. 

Douglas caught most of the verbal javelins thrown by lawmakers who focused on the $139 million the governor wants to save in next year’s budget by reducing the services offered under Medi-Cal, the state’s health care program for the poor. 

Nearly $115 million of that would come from eliminating dental care for adult patients. California is one of seven states that offer dental care, Douglas told the committee. 

Under the proposal, examinations, cleaning, restorative care, crowns and fillings would become the responsibility of the patient. Of the 2 million poor who use the dental program, about 40 percent are adults, Douglas said. 

“For every $1 spent in a clinical setting saves $4 in an emergency room setting,” said Jo-Linda Thompson, a lobbyist for the California Association of Dental Plans. 

Thompson was one of more than 100 people who testified against various aspects of the governor’s proposed health spending reductions. A line of witnesses – some in wheelchairs, some with guide dogs — stretched along one wall, around the back and part way down a third wall of Room 4203, the largest Senate hearing room in the Capitol. 

Also contentious is the governor’s proposal to reduce by 10 percent the reimbursement rate paid doctors and hospitals that treat Medi-Cal patients. 

California already has some of the lowest rates in the country. Both health care providers and advocates for the poor worry driving the rates even lower will discourage more doctors from caring for the poor – driving more to far more expense emergency rooms. 

But what provoked the most ire from Democrats – and at least one GOP lawmaker – were minimal savings proposals to end the state’s payment for incontinence creams and washes, audiology and speech therapy, optometry and podiatry. 

“Some of these savings are so small we’re probably spending more time talking about them than they’re probably worth,” Sen. Denise Ducheny, the San Diego Democrat who chairs the budget committee. 

Ducheny repeatedly probed the administration, asking if their proposed Medi-Cal cuts – which trigger and equal reduction in federal matching funds — considered additional state costs that would be incurred when the federal money was lost. 

In some cases, the administration’s savings did not, officials admitted. 

When Douglas said the administration wanted to end the state’s more than 30 year practice of paying for incontinence creams and washes to save $4.7 million out of a nearly $130 billion budget, one Bay Area senator boiled over.

“At some point you have to come to the point and say, What the hell have we come to?” said Sen. Joe Simitian, a Palo Alto Democrat. “I know that’s not a terribly helpful observation. But is this what we aspire to as a state?” 

In response to the administration’s proposal to eliminate podiatry services for the poor, Sen. Bob Margett, a Monrovia Republican, noted “people realize they have diabetes through the feet.” 

The administration also would end optometry services to Medi-Cal recipients, saying they should get treatment from ophthalmologists instead. Glasses would also no longer be paid for even though that means an $18 million revenue loss to California’s Prison Industry Authority, which makes lens and frames for Medi-Cal patients.

Administration official said they didn’t know if that revenue loss was factored into their $12.3 million Medi-Cal savings estimate. 

Lawmakers questioned how patients would better get eye care under the plan since there are few ophthalmologists than optometrists and, usually, ophthalmologists cost more. 

But even if patients were able to find treatment, the state would not pay for glasses, interjected Sen. Mike Machado, a Linden Democrat. “So you kick them off,” Machado said to Douglas. 

“We’re not kicking them off,” Douglas replied. “We are changing utilization patterns.” 

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