Medi-Cal Comes to Main Street

When Amber Truong came to California from Vietnam, she couldn’t afford to buy health insurance or see a doctor when she was ailing. While generally in good health, Amber feared she was one accident or illness away from the kind of financial disaster that could damage her and her boyfriend’s business, a nail salon in suburban Sacramento.

After years of anxiety about being uninsured, Amber was surprised and relieved to learn in 2014 that the Affordable Care Act had expanded eligibility for Medi-Cal, California’s Medicaid program for people with physical or mental disabilities, long-term care needs, or limited incomes. She eagerly joined the more than two million Californians who signed up for Medi-Cal under the new law. Now her savings are safe, and she knows that medical bills will not drive her into bankruptcy or threaten the family’s business. The 27-year-old’s enrollment was followed by a pregnancy, and she is now receiving prenatal care for her first child, due in September. The health benefits provided by Medi-Cal make it more likely that Amber and her baby will enjoy long, healthy, and productive lives.

Medi-Cal’s embrace of Amber Truong illustrates Medicaid’s remarkable evolution over a half-century from its origins as an adjunct to government “welfare” benefits. The numbers are impressive: Total US Medicaid enrollment has surged more than 10 million in the past year to surpass 70 million, and today Medicaid is the nation’s largest health insurer. In the Medicaid world, Medi-Cal is first among equals — the biggest state program with more than 12.2 million members. Nearly one of every three residents is covered by Medi-Cal. The Medicaid safety net has truly become a Main Street program, serving vast new populations of enrollees like Amber, including small-business owners and the self-employed, who make California’s economy so dynamic.

Like all Medicaid programs, Medi-Cal faces numerous challenges in delivering the right care at the right time. These challenges are opportunities to leverage the program’s size and significance to improve the entire health care system. Medicaid has grown even larger than its sister program Medicare, which Congress also created 50 years ago this month.

The California Health Care Foundation was pleased to support the July issue of Health Affairs, which focused on Medicaid’s 50th anniversary by featuring 15 articles on how Medicaid is shaped by — and has reshaped — care delivery. CHCF’s staff is focusing on Medicaid too, by tackling several key clinical areas in which Medi-Cal is one of the nation’s largest purchasers.

Maternity Care

Medi-Cal pays for half the births in California, and this gives it the influence to address alarming disparities in maternity care by applying financial pressure to encourage evidence-based and high-value care delivery. For example, Medi-Cal managed care plans are testing new payment arrangements for perinatal care to remove perverse financial incentives that reward hospitals for performing more cesarean sections. C-sections increase the risk of complications for mothers and babies and cost considerably more than vaginal deliveries. Doctors and hospitals are collaborating on initiatives to reduce the rates of unnecessary c-sections and to strengthen postpartum care for California’s moms. Medi-Cal will need to continue pushing for payment reform to align financial incentives with optimal clinical care and enhancing its quality monitoring systems to track performance.

Addiction Treatment

Medi-Cal is changing to cover an expanded range of drug and alcohol disorders for new and existing enrollees. A pending federal waiver for the Drug Medi-Cal program promises an organized delivery system for substance abuse disorder treatment and an expansion of medication-assisted treatment (MAT) and residential care, among other modalities. Medi-Cal needs to coordinate care across physical and behavioral domains, and between county behavioral health agencies and Medi-Cal managed care plans. This is work that will require new partners and creative thinking.

Palliative Care

As the primary payer for nursing home and long-term care services in California, Medi-Cal serves seriously ill patients and those near the end of life. Palliative care reduces pain and emotional distress, helps patients focus on what matters most to them, and often leads to reduced use of unnecessary and unwanted interventions. Medi-Cal plans to expand adults’ access to palliative care by establishing care standards and providing technical assistance to Medi-Cal managed care plans by this fall.

Other Challenges

There will be other challenges to address as well — especially to ensure access to care. For example, Medi-Cal must guarantee that its enrollees have equal access to services, including those for whom the gaps in access are greatest: people in poor health, enrollees with disabilities, and non-English speakers, among others. To achieve this, Medi-Cal will need to respond to workforce shortages, reimbursement concerns, and unwarranted variation in care quality. And Medi-Cal needs to foster accelerated change in the safety-net institutions that provide care to its enrollees.

This year, Medi-Cal will spend more than $90 billion caring for a huge number of Californians, including the most vulnerable among us. Medi-Cal has the dual responsibilities of ensuring high-quality care and wisely spending our limited tax dollars. Can it rise to so many challenges?

When the story of Medi-Cal’s next half-century is written, it will be more than a tale about health care systems and policies. It will be the story of California itself.