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recommended by the Council on Graduate Medical Education of 60 to 80 per 100,000 people.41  Physicians tend to be concentrated in urban areas of the state, meaning that rural counties tend to have greater shortages of both primary care and specialist physicians. 42  The growth in California’s physician supply in 2015 is estimated to be 4.7 percent, much lower than the estimated 15.9 percent growth in physician demand.43

Existing workforce shortages in California are compounded for Medi-Cal beneficiaries by Medi-Cal provider rates.  Provider payment rates in Medi-Cal have long been among the lowest in the nation,44 and in recent years have grown worse in relative terms.  Between 2003 and 2008, Medicaid rates across the country grew by 15 percent – still less than inflation, but much higher than the 2 percent increase seen by Medi-Cal providers in California.45  On average, Medi-Cal fees are 83 percent lower than the national average for Medicaid programs.  For some services – such as office visits for established patients – Medi-Cal reimburses at less than 70 percent of the national Medicaid average and approximately 40 percent of Medicare rates.46  

Reform Options

Historically, Medi-Cal waiver work has focused on strengthening the nursing workforce.  Some of the work being done in Los Angeles is the most innovative in the country.  As part of health reform, there is a growing understanding that primary care physicians and allied health professionals must be added to the workforce.

Renew and expand workforce training for nursing.  Review and assess existing California efforts funded currently (or initially) by Medi-Cal to determine what can be expanded.  Efforts should be expanded to allied health.

Debt forgiveness for certain providers willing to work in Medi-Cal.  To help grow the number of providers, Medi-Cal could initiate debt forgiveness for physicians who meet a certain level of volume in Medi-Cal FFS or who work exclusively in Medi-Cal managed care.

41 Grumbach, Kevin, MD, Andrew Bindman, MD, and Arpita Chattopadhyay, PhD, “The California Physician Supply Re-Count: Fewer and More Specialized,” University of California San Francisco for the California HealthCare Foundation and the University of California Program on Access to Care,” October 2008.  Available at http://www.chcf.org/documents/MPM-Sacto10-30-08Grumbach.pdf.

42 Ibid.

43 Center for Health Workforce Studies University at Albany, SUNY (2004). “California Physician Workforce Supply and Demand through 2015.” Rensselaer, NY, University at Albany, State University of New York.

44 S. Norton and S. Zuckerman, "Trends in Medicaid Physician Fees, 1993-1998," Health Affairs 19, no. 4 (2000): 222-232; California HealthCare Foundation, “Comparing Physician and Dentist Fees Among Medicaid Programs, June 2001.

45 Zuckerman, Stephen, Aimee F. Williams and Karen E. Stockley, “Medi-Cal Physician and Dentist Fees: A Comparison to Other Medicaid Programs and Medicare,” California HealthCare Foundation, April 2009.  Available at http://www.chcf.org/documents/policy/Medi-CalFeeComparison.pdf.

46 Ibid.

Health Management Associates/Harbage ConsultingPage 39

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