SACRAMENTO, Calif.

A budget that passed the California Assembly July 29, and was signed Aug. 9 by California Governor Gray Davis, would cut Medi-Cal providers' rates by 5 percent effective Jan. 1, 2004, according to a bulletin from the California Association of Medical Product Suppliers.

While the budget allows a few exceptions to the rate cut, medical supplies are not among those exceptions, CAMPS explained. “The cut applies to medical supplies and pharmacies; however, it gives Medi-Cal the discretion to apply the reduction to [durable medical equipment].”

Furthermore, the budget eliminates DME providers' ability to bill Medi-Cal for prosthetics and orthotics, and gives Medi-Cal the authority to base DME reimbursements on one of three methodologies: the current Medi-Cal allowable; a rate that does not exceed 80 percent of the Medicare allowable; or the guaranteed acquisition cost, plus a markup.

The budget also outlines “options” for altering reimbursements for unlisted DME, which include custom wheelchairs and modifications, CAMPS added. “CAMPS continues to negotiate with Medi-Cal on a potential reimbursement alternative for unlisted DME,” the association said. “The bill language allows us to continue discussions after the legislation is enacted.”

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