The Affordable Care Act presented a vision, and now officials at the State and local levels are working feverishly to adapt and plan for the future. However Obamacare services are ultimately delivered, it could have significant impacts on local governments.
Already, millions in California receive medical services through county agencies. In Los Angeles, more than 821,000 people visited a County medical facility, including 306,000 visits to emergency rooms and trauma centers.
“The County is an essential partner with the State and with the Governor’s administration in ensuring the success of federal health reform,” reads a statement issued by the County of Los Angeles in response to Thursday’s release of the Governor’s budget. “We are providers, hospitals, clinics and health systems; we administer the eligibility systems that will enroll people into coverage programs, and we provide carve-out mental health and substance abuse disorder treatment services.”
The Los Angeles Department of Health Services has an interest in continuing to work with State and Federal parties towards the ultimate expansion of Medicaid – set to take place on January 1, 2014.
Last time federal Medicaid was expanded, the number of patients serviced at County facilities experienced a dramatic reduction – highlighted by the decrease in births at County facilities. Before Medicaid was expanded, 43,000 babies were born at their facilities. Now, fewer than 3,000 are born at those facilities each year.
As explained in a report from the DHS to the Board of Supervisors, Michael Katz, the Director of the Department of Health Services explained that a “decrease in volume of say 30% may result in a decrease in expense of only about 5-10%… but will not affect the big cost drivers of the hospital.”
Those costs include the physical plant, specialized doctors, and internal systems.
Learning from the past exodus of patients in Los Angeles will require reforms, while expeditiously preparing for new responsibilities. Katz’s report recommended 23 different programmatic and operational reforms.
“We are only 13 months away from the Medicaid expansion. Failure to rapidly take the necessary steps… to prepare for the ACA implementation will result in huge financial shortfalls or closure of facilities, or both.”
Now, with less than 12 months left until the Affordable Care Act becomes reality, the Governor has released a state budget that calls for an expansion of Medi-Cal, a healthcare exchange, and other provisions of healthcare reform. But the details of the plan remain to be finalized.
“Counties have a lot at risk,” wrote the California State Association of Counties on their website in response to the Governor’s healthcare budget. “Counties could end up assuming more responsibility, more risk and possibly higher costs with no additional resources to pay for it.”
The cost of expanding Medi-Cal in the Governor’s budget was defined as $350 million, but that number is admittedly a placeholder while the true cost is determined.
The ACA calls for an optional expansion of a Medicare-style service to adults earning up to 138 percent of the Federal Poverty Level. According to CSAC’s Budget Action Bulletin, counties have been invited to participate in a dialogue to determine how Medi-Cal could best be.
There appear to be two options for realizing such an expansion. First would allow the state to administer a program, where “Counties would assume programmatic and fiscal responsibility for various human services programs.”
The other would be to expand the current Low Income Health Programs operated by counties.
Whichever approach is adopted, time ticks away as the state, counties, hospitals, and their respective officials, scramble to design and implement massive reforms with direct impacts on millions of Californians.
11 months, 17 days until the Affordable Care Act is operational.