Capitol Weekly

Prescription for health care system — money, flexibility

September 29, 2015

Experts in  California health care agree: The present system is unsustainable.   It needs more money and flexibility.

But that’s where agreement ends.  There are conflicting ideas about where the money should come from and where it should go.

The problems are not difficult to find:  Health care in the Golden State is under increasing pressure because of an aging population, the addition of some four million people to the state’s already-vast MediCal system serving the poor and there are pockets of the medically underserved across the state, particularly in rural areas.

Physicians are reluctant to take on many additional MediCal patients because per-patient reimbursement isn’t high enough to keep the office lights on.

It was all brought into sharp focus Sept. 23 at an all-day California Health conference sponsored by the Capitol Weekly and the University of California’s Sacramento Center.

The day was filled with idealism voiced by various interests who wanted to see improvements in California health care. But turf protection was critical, too, as many wanted to make sure that their organizations did not suffer financially from any of those improvements.

High among the panelists’ concerns is the Affordable Care Act’s impact, putting those greater-than-expected four million additional patients into MediCal and boosting the total MediCal patient load to 12.5 million, roughly one out of three Californians.

“They still keep coming,” said Jennifer Kent, the Brown Administration’s head of the Department of Health Care Services. “It’s like watching a python digest– a big lump coming through.”

Physicians are reluctant to take on many additional MediCal patients because per-patient reimbursement isn’t high enough to keep the office lights on, said Janus Norman, chief lobbyist for the California Medical Association.  So will millions of MediCal patients continue to use emergency rooms as their clinics, perpetuating a very expensive form of health care?  Or will policy makers find a way to bring them into mainstream medical care?

While infant mortality in the United States is declining, the disparity in outcomes between the well-off and the poor remains constant

Another complication is finding a way to match the feds’ $1.1 billion in MediCal funding to meet a 2016 requirement that the state’s matching funds come from a broader base, not merely from health care plans that accept MediCal patients.  A special session of the legislature called to deal with the problem continues — and so does the problem.  There is the possibility that if no agreement is reached, the $1.1 billion could come out of the state’s general fund — $1.1 billion is a great deal of money, but the state has a $108 billion budget, pointed out Felix Su of the Legislative Analyst’s Office

Anthony Galace of the Greenlining Institute faulted the ACA’s failure to include health care for the “undocumented community.”  Asked in a post-panel interview how inclusion could be politically possible when virtually all of the Republican presidential hopefuls are making illegal immigration a central feature of their campaigns against the illegal alien community, Galace held out hope that something might be accomplished at the state level, here in California, never mind national action.  The question here is whether any California Republicans could be peeled off from the national stance to make anything happen.

Undocumented immigrants aren’t the only underserved population, said Richard Figueroa of the California Endowment.  Income and location are factors as well, he said, pointing out that the average life expectancy in South Central Los Angeles is 75 years, while a few miles away in Beverly Hills, it’s 85 years.

While infant mortality in the United States is declining, the disparity in outcomes between the well-off and the poor remains constant, said state Sen. Richard Pan, a Sacramento pediatrician.  At the other end of the spectrum, we use more and more health care as we age, Pan said, with 5 percent of patients accounting for 50 percent of health care spending.

Behind all of the discussions of cigarettes and money lurked the possibility of a formal coalition quickly coming together behind a November 2016 initiative that would impose such a $2-per-pack tax.

In his keynote address, Pan said that change has to happen first, before savings become apparent — and making change happen before the benefits are in hand is difficult.

Nonetheless, despite imperfections, difficulties and bumps in the road, California “is a shining example of what can be done under the ACA compared with other states,” Pan said.

Pan has one answer to the problem of raising additional money for health care in California:  He is the sponsor of legislation that would impose a $2-per-pack tax increase on cigarettes.  Not only would the steeper price cut down on smoking, the proceeds could be used in some fashion for health care, he argues.

Janus, of the CMA, said his organization had been willing to sit down with the tobacco industry to seek a legislative answer — perhaps a compromise $1-per-pack tax, but the tobacco representatives were reluctant to enter such negotiations.

There shouldn’t be any negotiations between physicians and tobacco interests anyway, argued Daniel Zingale of the California Endowment.  Tobacco, he said, should be whacked with the $2-per-pack tax, period.

Behind all of the discussions of cigarettes and money lurked the possibility of a formal coalition quickly coming together behind a November 2016 initiative that would impose such a $2-per-pack tax.

The California Hospital Association is sponsoring its own 2016 ballot initiative, aimed at keeping intact a hospital fee system the CHA says brings $18 billion in federal money to the state’s health care system.

The CMA’s Janus, in an observation that could have come from Jerry Brown, nicely summed up the state’s health-care financing challenges.

“The amount of money available to the legislature to do good things,” Janus said, “is limited.”