OAKLAND, Calif. (CN) — Medi-Cal recipients and a major union sued California’s top health care officials in a class action Wednesday, accusing them of steadily cutting spending on the state’s health insurance program as the number of Latino Medi-Cal enrollees surged in the past two decades.
The lead plaintiffs, Analilia Jimenez Perea and her disabled son, were joined by the Service Employees International Union — United Healthcare Workers West, California’s largest health care worker union, the National Day Laborer Organizing Center, St. John’s Well Child and Family Center, and three other named plaintiffs.
They say the state began reducing Medi-Cal reimbursement rates to doctors as the percentage of Latino Medi-Cal patients rose between 2000 and 2016, to more than half of all enrollees.
Because Medi-Cal pays half of what Medicare pays for the same procedures — down from 65 percent in 2000 — doctors will not treat Medi-Cal beneficiaries, according to the complaint filed in Alameda County Superior Court.
So Medi-Cal’s predominantly Latino patients wait weeks or months for an appointment compared to their white counterparts, who are disproportionately covered by more generous Medicare and employer-sponsored insurance plans, the plaintiffs say.
The law requires California to provide Medi-Cal patients with the same access to care, and the plaintiffs claim the doctor shortage created by low reimbursements violates state anti-discrimination laws and the California Constitution.
“This disinvestment in Medi-Cal as the program became overwhelmingly Latino created a broken second-class system of Medi-Cal, of health insurance, where there are over 7 million Latinos depending on too few doctors willing to treat them,” their attorney Miranda Galindo said at a news conference Wednesday after the lawsuit was filed. Galindo is a staff attorney with the Mexican American Legal Defense and Educational Fund in Los Angeles.
It is estimated that 13 million Californians, 7.2 million of them Latino, are enrolled in Medi-Cal, California’s Medicaid program. The program covers low-income adults and families, seniors, people with disabilities, pregnant women and children in foster care: more than one-third of the state population.
In some counties, such as Tulare and Merced in Central California, more than 50 percent of residents were enrolled in the program in September 2015, according to the Department of Health Care Services, which is named as a defendant.
Medi-Cal patients are more likely to have trouble finding care and have their insurance coverage rejected by a provider, according to the complaint. It says that from 2013 to 2015, 24 percent of enrollees could not get an appointment within two days for an illness or injury, compared to 9 percent of Medicare patients and 8 percent of patients with employer-sponsored insurance.
Because of the difficulty of finding a doctor, Medi-Cal patients get sicker while waiting for care, and are particularly likely to be diagnosed at late stages of breast, colon, and rectal cancer, the plaintiffs say.
Castañeda said she nearly died while waiting for gall bladder surgery after her doctor canceled her surgery twice because he refused to take Medi-Cal. Castañeda finally had emergency surgery in Mexico, a year after she was diagnosed. She developed complications due to the delay and can no longer work.
“I felt powerless and frustrated knowing I couldn’t better my situation,” Castañeda said at the news conference through an interpreter.
Crystal Pryor, a Medi-Cal patient but not a plaintiff, said her doctor canceled a surgery to treat breast lumps three times because she was on Medi-Cal. She eventually received treatment at a clinic in Pleasanton in the East Bay, two years after her mammogram.
“It was overwhelming,” Pryor said in an interview Wednesday. “I was angry because I believe insurance is insurance, and it doesn’t matter what kind of insurance you have.”
The lawsuit also accuses the state of imposing administrative burdens on doctors and patients that further limit access to care. According to the complaint, the state delays payments to providers and even claws back payments months or years after treatment.
Alameda County Supervisor Wilma Chan, who has been majority leader in the California Assembly, said the state has made it harder for patients to apply for Medi-Cal, made them apply twice a year, and cut benefits from the list of conditions treated under the program.
“None of these things grant equal access to patients,” she said at the news conference.
Alameda County, based in Oakland, passed a sales tax in 2004 to supplement the state funding it gets for Medi-Cal. But Chan said county hospitals are running deficits and wait times for appointments are still too long.
Asked whether the state is intentionally discriminating against Latino Medi-Cal beneficiaries, Chan was circumspect.
“I can’t kind of guess what people’s intent is, but it just seems too coincidental that as more Latinos and more people of color got into this program that the rates were cut,” she said in an interview.
However, plaintiffs’ co-counsel Darin Ranahan, with Feinberg, Jackson, Worthman & Wasow in Oakland, said: “When you have a disparity that’s this extreme, courts have found that that’s evidence in and of itself of intent.
“We think that the pattern of disinvestment as Latino enrollment has grown is extremely suspicious,” he added.
The Department of Health Care Services denied the allegations Wednesday.
“DHCS has not identified any systemic problems with patient access to services in the Medi-Cal program nor has the federal Centers for Medicare and Medicaid Services identified any issues,” the agency said in a statement.
In a May 2016 letter to the plaintiffs’ attorneys, the state denied accusations that Medi-Cal discriminates against Latinos. The letter was a response to a December 2015 civil rights complaint against the health care services department and the California Health and Human Services Agency, which is also a defendant in the new suit.
“To the extent that you claim that Medi-Cal reimbursement rates discriminate against Latinos, there is no evidence of any such discrimination, nor are the claims articulated in your letter legally cognizable,” Deputy Attorney General Gregory Brown wrote in the letter. “You have not alleged, and we are not aware of, any evidence that Latino beneficiaries are being treated differently than other beneficiaries under the Medi-Cal program. Indeed, Medi-Cal rates are uniform for all providers and patients, and they do not discriminate in any way on the basis of race, color, national origin, or any other protected category.”
The plaintiffs seek class certification and ask the court to order California to raise Medi-Cal reimbursement rates, reimburse doctors on time, and ensure that patients have timely access to care.
Co-counsel includes Bill Lann Lee with the Civil Rights Education and Enforcement Center of Berkeley, Ana de Alba with Lang, Richert & Patch in Fresno, and Noah Phillips, in Oakland.