Don’t have Medi-Cal? Cutting it will still hurt you – here’s how.

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You pick up the phone and start your daily scrolling. There’s an alarming headline. You think, “Thank goodness that doesn’t affect me.” And you move on. It’s natural. 

With so much going on in our lives today, we have a tendency to hunker down and protect ourselves and our loved ones.

As we speak, the United States Congress is considering significant cuts to Medicaid (known as Medi-Cal in California). Not little, around-the-edges cuts, but cuts estimated to be between $700 and $900 billion. 

This is not a “you should care about other people” article. 

This is about you and your loved ones. Even if you and your family have health insurance through an employer plan, here’s why you should still care about this headline. A lot.

With huge cuts to Medi-Cal, the first thing that will be affected is the money that flows into our local health care system. About a third of people in Santa Cruz County are covered by Medi-Cal. If reimbursement for all of those patients receiving care is reduced, there’s instantly less money for everything else. 

Here’s an example. Like many hospitals in California, hospitals in our community face shortages of sub-specialty physicians (physicians who specialize in one specific organ or system in our bodies). For any specialty with only one or two doctors practicing in it, let’s say they leave the community or retire. If the health systems in our area couldn’t afford to recruit a new one, we might lose that service entirely. Decreased Medi-Cal revenues will only exacerbate the problem.

“What if some part of my body breaks or fails? Will there be anyone with that expertise to see me? How long will I have to wait, or how far will I have to travel?”

These are questions you need to think about. 

You may say, “Whatever, Steve, I’m in great health! I’ll still be fine!” 

That’s great, and I hope that’s true. Let’s explore another implication. When hospitals and doctors face reimbursement cuts from the government, they try to make that up somewhere else to avoid closure or service reduction. They make it up by negotiating higher rates from other insurance providers, like your employer plan. That means your health insurance provider pays more. 

Think they just take that increase out of their own bottom lines to pay for it? Of course not. They pass it on to you, in the form of more expensive insurance premiums, co-pays and co-insurance. (Even if your heart is healthy and your bones are strong and you rarely need to see a doctor.)

We know this from our history. According to the Kaiser Family Foundation, average annual premiums for family coverage rose 7.7% per year from 1999 to 2013. When the Affordable Care Act expanded access to health insurance everywhere starting in 2014, including expanding access to Medi-Cal, annual premium increases were cut in half, to 3.9% per year. Cutting Medi-Cal will increase your health insurance costs at a faster rate. 

While that’s happening, the people who’ve lost Medi-Cal coverage won’t see a doctor, because they don’t have insurance to pay for regular and preventive care. If they have a chronic illness like diabetes, it’s unlikely to be managed effectively without a physician’s guidance or the proper treatments. What is likely is they will become so sick they need emergency care. 

Our area’s limited ambulance service will get even busier, leading to longer wait times. When they do get to the emergency department, it’s likely to be packed with others who now use the emergency room for their primary care.

Ever needed to go to the emergency room? Did you breeze in and out? 

No, it can take hours. Picture it with thousands more people visiting every year because they don’t have any other option. The Watsonville and Dominican Hospital ERs are already among the busiest in the state. In 2023, Watsonville’s ER was the 16th-busiest in the state when adjusting for the size of the ER. Dominican’s is not far behind. 

Those numbers, and the wait times and delayed care, would only get worse.

Illness and ER use is one thing. Death, of course, is another. A study published in May by the National Bureau of Economic Research found that people who gained access to Medi-Cal when access was expanded were 21% less likely to die in a given year than those who did not enroll. That’s a huge impact on our community.

You’ve likely heard of the “butterfly effect” – the concept that small changes in one place can cascade into more and larger changes elsewhere. Drastic cuts to Medicaid would be more like a “pterodactyl effect” – a large initial change that cascades to almost all aspects of our lives. And it won’t matter whether or not you care about the impact it has on others. It will ultimately impact us all. 

Call your elected representatives to urge them not to cut Medicaid, and ask your friends and family members in other parts of the country to do the same.

We all need to act, because we all stand to lose. 

Stephen Gray is the chief executive officer of the Pajaro Valley Health Care District and Watsonville Community Hospital.