As early as next month, California’s Office of Health Care Affordability could set a statewide spending target (the current staff proposal is at 3%) for the state’s entire health care sector. Staff have proposed setting this target for the next five years, even though state law only requires that the initial, non-enforceable target for 2025 be set at this time.
The office — established by legislation in 2022 with a dual mandate to improve the affordability of health care and to do so without sacrificing access to, or the quality of, health care — has a June deadline to set the target. That means there is still time to make sure the eight members of the office’s board hear from hospitals and other providers about the impact on access to care if the target is set too low.
Many thanks to those hospital leaders who testified at the board’s meeting on Wednesday. Hearing from hospitals and other providers is essential to convey to the board the importance of meaningful changes to the office’s proposal to protect patients.
The consequences of a target that fails to account for the impact on access to care cannot be overstated. Consider just two facts:
- First, that a 3% target does not even keep pace with general inflation, projected at 3.4% for the coming year, meaning that health care in California would see de facto cuts at a time when communities are seeing their hospitals fighting just to stay afloat, maternity services are shutting down, massive investments are needed in behavioral health care, patients covered by Medi-Cal are struggling to find care, and rural health providers are hanging by a thread.
- Second, that every percentage point reduction from the current system represents a $4-5 billion annual and growing reduction in resources to care for patients. That means fewer jobs, fewer services, more crowded emergency rooms, farther drive times, and, regrettably, more negative outcomes for patients.
Earlier this month, CHA sent an alert asking for hospitals to submit comment letters to the board. There is still time to deliver those letters, and CHA will provide additional data and key points for your team’s consideration in the next couple of days. CHA’s letter to the board this month is also available for reference.
California hospitals exist for one reason: to serve their patients, their communities, and their team members. That includes providing the life-saving services that so many take for granted will always be there. Setting a growth target lower than historical trends is only one half of this complex equation. All stakeholders must solve for the other half: how to make sure that any target does not hurt the very people it’s intended to help.
