CHA News Article

DHCS Releases Guidance for Medi-Cal Managed Care Plans
Includes subcontracting relationships and delegation requirements

The Department of Health Care Services (DHCS) has issued the attached All Plan Letter summarizing new subcontracting and delegation requirements for Medi-Cal managed care health plans (MCPs), pursuant to the Centers for Medicare & Medicaid Services (CMS) Medicaid managed care final rule. The letter addresses both CMS’ requirements as well as requirements that MCPs must meet to fulfill their contract with DHCS.

The guidance outlines that, regardless of whether an MCP’s relationship with a subcontractor is direct or indirect through additional layers of contracting or delegation, the MCP has the ultimate responsibility for adhering to all terms and conditions of its contract with DHCS. In addition, the MCP contract requires that subcontractors comply with all applicable Medicaid laws and regulations, as well as applicable state and federal laws. MCPs must implement policies and procedures for imposing corrective action and financial sanctions on subcontractors if the MCP discovers the subcontractor is noncompliant.

The guidance also states that MCPs must ensure subcontractors meet the care coordination requirements contained in the contract with DHCS, and must ensure the delegation of care coordination services results in consistent treatment of MCP beneficiaries across delegated entities. 

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