On Wed., April 24, SB 646, the bill sponsored by Eastern Plumas Health Care was heard in the Senate Health Committee. Tom Hayes, EPHC CEO, Jon Kennedy, Plumas County Supervisor, skilled nursing resident Inez Fagliano’s two daughters, Jan Tew and Jeanne Fagliano, and Linda Satchwell, PR Coordinator, all headed to Sacramento for the hearing.
SB 646 sought to exempt the most vulnerable, rural skilled nursing facilities from the pending Medi-Cal cuts. These cuts would amount to a 23% reduction in payments going forward (approximately $1.3 million per year) and $2.4 million in retroactive cuts. In effect, it would be a large, double hit to EPHC’s already fragile finances. The language of the bill was written to also exempt 26 other fragile hospitals like EPHC.
The California Hospital Association (CHA), the organization that lobbies for hospital interests in the CA legislature also has two bills this session that cover the SNF cuts–AB 900 in the Assembly and SB 640 in the Senate. Originally, AB 900 would have exempted ALL DP/SNFs (distinct part, or hospital, skilled nursing facilities) from the Medi-Cal cuts. That bill and the added twin Senate bill, SB 640, were expanded greatly-they now include exempting Medi-Cal cuts to doctors, dentists, sub-acute facilities, and the new managed care organizations that are currently coming into play, along with exempting all DP/SNFs.
Our feeling was that asking the CA legislature to rescind ALL Medi-Cal cuts was likely to fail, because it would be a huge budget hit-over $500 million. Our bill, SB 646, which exempted only the smallest, most vulnerable hospitals-those that might close if the cuts went through-would hardly affect the budget. If the cuts were implemented, however it would have a devastating effect on health care in our community and others like us. The estimated cost to the state to exempt the 26 rural and vulnerable DP/SNFs is $8 – $10 million.
We learned a lot about politics and political wheeling and dealing on that day in Sacramento. Our lobbyist, Tim Taylor met with Chairman of the Senate Health Committee, Ed Hernandez, along with the rest of the Senators on the Committee. He told us that we had unanimous support for our bill. The day before the hearing we heard, however, that Sen. Hernandez wanted our bill to be amended to cover ALL DP/SNFs (hospital skilled nursing facilities) rather than just the smallest, most vulnerable ones, if he was going to support the bill. We had to have his support for the bill to get out of committee, so we had to agree. Sen. Neilsen, the “author” of the bill (meaning, the senator who has agreed to support and present the bill) agreed to this change when our lobbyist told him about it in a meeting before the hearing. He seemed to think that the $58 million price tag to exempt all 88 DP/SNFs wasn’t too high.
SB 646, as amended, passed unanimously out of committee. Next, I believe it will go to Appropriations, then to the full Senate. It’s likely there will be a decision on the bill between June and August.
We had mixed feelings about the results. Our bill passed unanimously. But, now our bill was what the CHA bill (AB 900) had been-a bill that exempts all DP/SNFs and is much larger and more costly than our original. It comes with a higher price tag but, perhaps, more backing since it helps hospitals in more Senators’ districts. If it passes, it will be wonderful to have helped all DP/SNFs. If it doesn’t because the price tag is now to high, it will be a tragedy that we were forced to accept that amendment.
One thing was clear, there is a lot more to politics than meets the eye, and we are new at the game. Our lobbyist is an old hand, however, and he assured us that we did what we had to do. In two different conversations with CHA lobbyists, we were told, “It’s not logical, it’s politics.” It remains to be seen, though, whether politics will save our hospital’s skilled nursing facilities from these devastating MediCal cuts.