Bay Area Reporter - October 2, 2008
Seth Hemmelgarn, s.hemmelgarn@ebar.com

The budget for the state Office of AIDS this year is $462,538,000, up from $427,993,000 in fiscal year 2007-08.

But some pieces of the budget could bring problems when it comes to Medi-Cal reimbursements. Dispensing fees will be combined with the cost of each drug, and 5 percent will be cut from this combined amount. This means some pharmacies may have to deliver the drug below cost, some pharmacies may not take Medi-Cal patients, and some pharmacies may not be able to make high-cost drugs available.

As of December 2007, 36,320 of the state's 6.6 million Medi-Cal beneficiaries - or .0055 percent - were living with HIV/AIDS, according to June Iljana, assistant associate secretary of external affairs for the state's health and human services agency.

However, there's already a limited number of physicians "seeing people with HIV/AIDS, so if this further narrows the pool, that becomes an issue," said Courtney Mulhern-Pearson, policy and legislative associate for the San Francisco AIDS Foundation.

Mulhern-Pearson said a particular concern involves "share of cost."

Share of cost

Californians with a Medi-Cal share of cost have incomes that are too high to receive free or no cost Medi-Cal, but too low to pay for their necessary medical care. They must incur a share of cost each month, which is the difference between the person's income, less any allowed income deductions, and the maintenance need level for the family size before Medi-Cal begins to pay for any of their health care services for the remainder of the month.

Typically, seniors and people with disabilities who have a share of cost must incur over $500 in medical expenses in a month before Medi-Cal coverage kicks in. Few medically needy beneficiaries are able to meet this share of cost each month, so they can't benefit from their Medi-Cal coverage, according to the fact sheet according prepared by AARP, Project Inform, SFAF, and other groups.

The state currently pays the Medicare Part B premiums of these and others who qualify for both Medi-Cal and Medicare. Medicare Part B premiums are almost $100 each month.

In the recently approved budget, the state could stop paying the Part B premiums of the 57,000 seniors and individuals with disabilities who qualify for Medi-Cal with a share of cost above $500. Many of these people would lose access to health care as a result, the groups stated in the fact sheet.

Other changes

A 10 percent reduction to Medi-Cal reimbursements for providers, including doctors and pharmacies, is currently in effect. However, an August 18 court order blocked reductions for six categories: dentists, optometrists, physicians, pharmacies/prescription drugs, adult day health centers, and clinics.

The state expected to reduce rates for non-contract hospitals in open areas by 5 percent on Wednesday, October 1. On November 1, non-contract small and rural hospitals will be exempted from the current reductions. Then, on March 1, 2009, rates will be reduced for providers by nothing, 1 percent, or 5 percent, depending upon their category.

Also under the budget, the cost-of-living increase will not happen for the California portion of the Supplemental Security Income payments to the blind, elderly, and disabled that was supposed to take affect this October.

In addition, there was a net reduction in education and prevention funding from last year of $5.85 million, according to Iljana. Most of this cut came from Schwarzenegger.

H.D. Palmer, state finance spokesman, said this "should in no way, shape, or form be construed as meaning that the governor thinks that this is not a worthwhile or worthy program, but it represents one of the literally several dozens of decisions that the governor had to make" to build the state's budget reserve.

Also, HIV programs including housing assistance and HIV counseling and testing, and early intervention have budget balancing reductions totaling $922,000. On top of that, epidemiological studies and surveillance program activities and the case management program will both be cut by $400,000.

The budget also stops funding for the state's methamphetamine awareness campaign, which for the past several months has blanketed parts of the city with "Me Not Meth" ads targeting men who have sex with men. This was the first year of the campaign. The second year was to have been directed at women of childbearing age.

Some cuts avoided

A proposal had been made to remove classes of drugs from the AIDS Drug Assistance Program, but money was found to cover the costs and the drug assistance program formulary will be fully funded.

The therapeutic monitoring program, which provides viral load and resistance testing for people who don't have coverage, had received a $4 million augmentation last year but initially hadn't been included in this year's budget. However, that augmentation is included in this year's budget.

According to Dr. Michelle Roland, chief of the state Office of AIDS, "On average, state funding for the AIDS-related programs ... were reduced by approximately 6 percent." In an e-mail, Roland wrote that in many cases the reduction in total funding was less than 6 percent, since many of the programs are also supported with federal funds. "No programs were eliminated," she wrote.

However, "Many difficult choices had to be made this year because there was just not enough money to fully support all of the services that the state provides," Roland wrote. "Although the programs that have been reduced are definitely valuable and improve people's lives, it's important to note that California still provides a high level of care for people living with HIV/AIDS."

She noted, "The 2008 Budget Act includes more than $160 million from the state's general fund for HIV/AIDS programs. Including state, federal and special funds, more than $441 million will be devoted to AIDS" this year, she wrote.

Governor signs AIDS-related bills

In recent days, the governor signed several bills related to HIV/AIDS.

Tuesday, September 30, Schwarzenegger signed Assembly Bill 1894 by Assemblyman Paul Krekorian (D-Burbank). The bill makes California the first state in the country to require every health care service plan and health insurer to provide coverage for HIV testing, regardless of whether the testing is related to a primary diagnosis.

"With the governor's signature of AB 1894 today, California once again has demonstrated its global leadership in developing innovative policies to fight the HIV pandemic," Krekorian said in a statement. "This legislation will set the standard throughout the nation by making HIV screening a routine part of ordinary preventive health care."

In his signing message, the governor highlighted the data by the Centers for Disease Control and Prevention showing the underestimation of the HIV epidemic in the United States over the last decade.

Another piece of AIDS-related legislation that Schwarzenegger signed on Sunday, September 28 was Assembly Bill 2899. The bill, authored by Assemblyman Anthony Portantino (D-La Canada Flintridge), will give state-funded HIV testing sites flexibility in the services they provide to clients. The bill allows publicly funded HIV test sites to advise people who've been tested before and are following appropriate public health risk reduction measures that they don't need more education services. The legislation also allows testing sites to determine whether a person should be allowed to self-administer data collection forms required by the department, and to provide prevention education through video, small groups, individual interaction, or other methods to small groups or couples.

The bill should increase the capacity of HIV test sites to screen more individuals by streamlining test site services.

On Friday, September 26, the governor signed SB 1184, by state Senator Sheila Kuehl (D-Santa Monica). This bill requires physicians providing insemination or advanced reproductive technologies to, among other things, verify and document in the recipient's medical record that the donor of sperm who tests reactive for HIV or human T lymphotrophic virus-1 is under the care of a physician to minimize the risk of transmission during the course of insemination or advanced reproductive technology services.

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