Medi-Cal Cuts Could Lead to Spikes in Charity Care, Bankruptcy for Several California Hospitals

Last week, CMS approved California's plans to reduce Medicaid rates by 10 percent for physicians and providers, and the repercussions could be far-reaching and deep for several hospitals across the state.

Matt Rees, CEO of Mayers Memorial Hospital in Fall River Mills, Calif., said the cuts in Medi-Cal, the state's Medicaid program, could force the hospital to lay off 50 employees and cut all or part of several different hospital programs, according to a Record Searchlight report. The cuts could even drive the hospital into bankruptcy, he said in the report.

Lindsay Mann, CEO of Kaweah Delta Health Care District in Visalia, Calif., said his hospital's charity-care burden will probably reach $29 million this year, according to a Fresno Bee report. In 2008, that total was $13 million.

The California Hospital Association criticized CMS last week, saying the Medi-Cal cuts will exacerbate the number of uninsured patients and may force droves of physicians to stop accepting Medicaid patients altogether.

Related Articles on Medi-Cal:

Obama Administration Allows California to Cut More Than $600M From Medicaid Program
Finances in the Era of Population Health: Q&A With Kevin Lang and Steve Mohr of Loma Linda University Medical Center
California's Medi-Cal Proposals Would Increase Co-Payments, Cut Hospital Payments

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