California public health plans call on Congress to strengthen Medicaid system

Through an effort led by L.A. Care Health Plan, 16 California public health plans submitted a letter to Congress on Thursday calling on leadership to strengthen the Medicaid system during COVID-19 and the subsequent recession. This letter follows up a separate L.A. Care letter sent in May to Congress in anticipation of a Medicaid enrollment surge.

The new letter outlines five measures the health plans believe should be included in the next COVID-19 relief package.



The letter calls on Congress to:

  • Increase the federal share of Medicaid funding for at least two years: The health plans highlight the large budget gaps on the horizon as states experience decreases in revenue and simultaneous increases in the need for services including Medicaid. Their analysis estimates between $167.6 and $192.1 billion will be needed to sustain the Medicaid program at the current level amidst the pandemic and recession.

By picking up a larger share of the costs of Medicaid, the federal government can make sure that state budget decisions do not constrain the health response needed by the states to address the pandemic. It will also ensure that increased Medicaid costs do not force states to cut spending in other areas (e.g., education or public safety).”

  • Suspend the proposed Medicaid Fiscal Accountability Proposed Rule (MFAR): The MFAR rule would alter the way states are able to finance their share of Medicaid, resulting in large cuts to state programs. The letter asks that the MFAR rule be suspended during the pandemic and that further analysis by done by CMS to understand the impacts of the rule.
  • Make temporary changes to telehealth permanent: During the pandemic, regulatory and statutory changes made it easier for patients to access services through telehealth. The health plans ask Congress to advance telehealth and telephonic policies and payment reform in Medicaid and Medicare.
  • Suspend the Public Charge Rule: As a public health response, the letter asks for the full suspension of the Public Charge Rule until the COVID emergency has ended.

“The Public Charge rule makes legal immigrants who receive non-cash public benefits, such as Medicaid, food assistance, and housing assistance, potentially ineligible for green cards and visas,” reads the letter. “Not surprisingly, the Rule has created an environment of fear throughout immigrant communities who were already wary of accessing health care coverage, long before the Rule went into place.”

  • Extend Presumptive Eligibility: The health plans are calling on the federal government to allow Presumptive Eligibility for a 90-day period to provide short-term coverage for likely-eligible Medicaid enrollees while their full applications are considered. This, they write, will be particularly important as a potential influx of Medicaid applications could make it difficult to process and respond in a timely way.

“After the 2008 financial crisis, Congress moved to shore up the Medicaid system, and it must do so in this recession,” said John Baackes, L.A. Care CEO. “The COVID-19 pandemic is further straining state budgets across the country, and without federal action, there could be major cuts to Medicaid benefits.”