Medi-Cal is California's Medicaid program — a public health insurance program that provides needed health care services for low-income families with children, seniors, people with disabilities, foster caregivers, pregnant women and low-income people with specific diseases, such as tuberculosis, breast cancer or HIV/AIDS. Medi-Cal is financed equally by the state and federal governments.
Medi-Cal is California’s Medicaid program — a public health insurance program that provides needed health care services for low-income families with children, seniors, people with disabilities, foster caregivers, pregnant women and low-income people with specific diseases, such as tuberculosis, breast cancer or HIV/AIDS. Medi-Cal is financed equally by the state and federal governments.
Under the federal Medicaid managed care final rule, states are required to establish network adequacy standards in Medicaid managed care for key types of providers. Beginning with the July 1, 2018, health plan contract year, states must:
Develop and implement time and distance standards for primary and specialty care (adult and pediatric), behavioral health (adult and pediatric), OB/GYN, pediatric dental, hospital and pharmacy providers
Develop and implement timely access standards for long-term services and supports providers who travel to the beneficiary to provide services
Assess and certify the adequacy of a managed care plan’s provider network at least annually
To meet those requirements, the Department of Health Care Services (DHCS) earlier this month submitted four network adequacy certification documents to the Centers for Medicare & Medicaid Services. The results — which pertain to Medi-Cal managed care health plans (MCPs), mental health plans (MHPs), Drug Medi-Cal organized delivery systems (DMC-ODS) plans and dental managed care plans — are available on the department’s network adequacy web page.
The Department of Health Care Services has submitted its final Managed Care Quality Strategy Report to the Centers for Medicare & Medicaid Services. As previously reported in CHA News, DHCS developed this report as required under the federal Medicaid managed care final rule. The report addresses quality strategies across all of California’s Medicaid managed care delivery systems, including managed care plans, county mental health plans, Drug Medi-Cal Organized Delivery Systems and dental managed care plans. The report also discusses how California’s Medicaid quality strategy meets federal requirements related to:
The state-defined network adequacy standards
The state’s goals and objectives for continuous quality improvement, a description of the quality metrics, performance targets and performance improvement projects
Arrangements for annual, external independent reviews
A description of the state’s transition of care policy
The state’s plan to identify, evaluate and reduce health disparities
Policies regarding sanctions
The state’s definition of ‘‘significant change”
The final version incorporates feedback received during the public comment period and will be updated annually to reflect significant changes.
The Department of Health Care Services (DHCS) recently updated its policy for hospitals reimbursed under the All Patient Refined Diagnosis-Related Group (APR-DRG) for claims with dates of service in state fiscal year 2018-19.
Effective July 1, the following changes apply to general acute inpatient hospital services provided by private hospitals and non-designated public hospitals in California, out-of-state (border and non-border) hospitals and Medicare-designated critical access hospitals:
Changes to the APR-DRG grouping algorithm Version 34 to Version 35
Modifications to Version 35 relative weights under the hospital-specific relative value methodology
Decrease in the policy adjustor-age for pediatric services from 1.45 to 1.25
Application of the following policy adjustors for high severity of illness (SOI) 4:
Policy adjustor of 1.4 is additionally applied to the SOI 4 Pediatric (Age) and Neonate (NICU services and NICU surgery) care categories.
Policy adjustor 1.1 is additionally applied to SOI 4 Adult (Miscellaneous, Respiratory, Gastroenterology and Circulatory) and Obstetrics care categories.
Last week, the Department of Health Care Services announced that UnitedHealthcare Community Plan of California (UHC) will stop serving Medi-Cal members in Sacramento County beginning Oct. 31. The department has frozen enrollment in Sacramento County and, in coordination with UHC, will begin outreach to the approximately 4,400 Medi-Cal members impacted by the change. The outreach, to begin by Aug. 1, will provide information about other health plan choices and continuity of care, and assist enrollees in transitioning to a new plan. UHC will continue to provide Medi-Cal managed care services in San Diego County.
Phase 1 of the California Children’s Services Whole-Child Model was implemented on July 1. Senate Bill (SB) 586 (Chapter 625, Statutes of 2016) authorized the Department of Health Care Services (DHCS) to establish the Whole-Child Model (WCM) Program in designated County Organized Health System or Regional Health Authority counties. The WCM program incorporates services for Medi-Cal-eligible children and youth who are covered under the California Children’s Services (CCS) Program into a Medi-Cal managed care plan contract. The WCM Program is expected to improve care coordination for primary, specialty and behavioral health services for CCS and non-CCS conditions. The benefits are consistent with CCS program standards and provided by CCS paneled providers, specialty care centers and pediatric acute care hospitals. The WCM approach meets the six goals for CCS redesign:
Implement patient and family-centered approach.
Improve care coordination through an organized delivery system.
The Centers for Medicare & Medicaid Services (CMS) has announced new and enhanced initiatives on Medicaid program integrity aimed at creating greater transparency and accountability.
The initiatives include stronger audit functions, enhanced oversight of state contracts with private insurance companies, increased beneficiary eligibility oversight and stricter enforcement of state compliance with federal rules.
CMS will begin targeted audits of select states based on the amount spent on clinical services and quality improvement compared to administration and profit. The medical loss ratio audits will also include a review of states’ managed care rate setting.
To help providers understand and predict estimated payment for inpatient stays covered by fee-for-service Medi-Cal, the Department of Health Care Services (DHCS) has released a new pricing calculator. The calculator applies to stays with dates of admission beginning July 1, 2018, through June 30, 2019, and reflects new wage index values, hospital-specific base rates and other changes.
For stays with dates of admission prior to July 1, 2018, visit the DHCS web page. Providers should note that the calculator is intended to be a helpful tool, but cannot capture all editing and pricing complexity of the Medicaid claims processing system. If the calculator estimates a payment that differs from that of the claims processing system, the claims processing system is correct.
Last week, the Medicaid and Children’s Health Insurance Program (CHIP) Payment and Access Commission (MACPAC) released its June 2018 Report to Congress on Medicaid and CHIP. The report includes recommended statutory changes that would allow state Medicaid programs to pay the lowest price for certain drugs, as well as clarifications related to protecting the privacy of patients with substance use disorders. MACPAC’s recommendations seek to close a loophole in the Medicaid Drug Rebate Program that allows a manufacturer to sell its authorized generic at a low price to a corporate subsidiary, reducing the rebate obligation for its brand drug. In addition, MACPAC recommends giving the Secretary of the U.S. Department of Health and Human Services clear authority to impose intermediate financial sanctions on manufacturers that misclassify a brand drug as a generic to lower their rebate payments.
The Department of Health Care Services (DHCS) has announced that specific checkwrites scheduled for the last two weeks of the current fiscal year will be delayed until the start of the next fiscal year.
Medi-Cal funded fee-for-service programs scheduled with a warrant date of June 21 will be held until July 6. Checkwrites and payments to the following programs will be held during this period:
Child Health and Disability Prevention (CHDP) program
Family Planning, Access, Care and Treatment (Family PACT) Program
Medi-Cal (Medicaid and state-only)
Medi-Cal funded fee-for-service and state-funded programs scheduled for June 28 will be held until July 6. Checkwrites and payments to the following programs will be held during this time period:
California Children’s Services (Medi-Cal and state-only)
CHDP (Medi-Cal and state-only)
Family PACT Program
Genetically Handicapped Persons Program (Medi-Cal and state-only)
Medi-Cal (Medicaid and state-only)
Separate Children’s Health Insurance Programs, including:
Medi-Cal Access Program
Medi-Cal Access Infant Program
Due to increased program utilization, claim payments for May 24 and June 1 associated with the Every Woman Counts program have been delayed until June 7.
The Kaiser Family Foundation has released a new report that examines how potential changes at the federal level would impact participation in Medicaid, the Children’s Health Insurance Program (CHIP), marketplace coverage and other programs. The changes would, for the first time, allow the federal government to consider health, nutrition and non-cash programs — including use of Medicaid, CHIP and subsidies for marketplace coverage — when making public charge determinations.
According to the report, these changes could result in the federal government denying an individual a “green card” or adjustment to lawful permanent status or entry into the U.S. and would likely result in reduced participation in these programs — despite the fact that citizen children with a noncitizen parent would remain eligible. In 2016, there were 10.4 million citizen children with at least one noncitizen parent. The report illustrates the potential impact of different Medicaid/CHIP disenrollment rates and shows that, if the policy leads to disenrollment rates from 15 to 35 percent, an estimated 875,000 to 2 million citizen children with a noncitizen parent could drop Medicaid/CHIP coverage despite remaining eligible. Such coverage losses would reduce access to care, contributing to worse health outcomes.
Today, CHA joined a coalition — including California HealthPlus Advocates and the California HIV Alliance — in hosting a lobby action day to protect the 340B Drug Pricing Program. During the event, hospitals and safety-net providers that depend on the program met with key budget committee legislators and staff, as well as Assembly and Senate leadership, to share their opposition to the Department of Health Care Services’ budget proposal that would eliminate the program in Medi-Cal.
The event opened with a press conference (view slideshow) featuring Sen. Richard Pan (D-Sacramento) and representatives from safety-net providers that would be negatively impacted by the program’s elimination. During the conference, Sen. Pan stated that the proposed elimination of the program would represent a major “step backward” for the state’s vulnerable populations.
“The 340B Drug Discount program has been the source of important funds for hospitals and clinics to provide care for Californians on Medi-Cal. The state government needs to ensure these resources remain available for patient care,” said Pan.
The California Association of Public Hospitals and Health Systems and the California Health Care Safety Net Institute have developed an issue brief highlighting the efforts that California’s 21 public health care systems are undertaking to identify and reduce specific health disparities. Through the Public Hospital Redesign and Incentives in Medi-Cal (PRIME) program — a component of California’s Medi-Cal 2020 waiver — all health care systems are undertaking concurrent and harmonized efforts to improve the collection of race, ethnicity and language data and to begin compiling gender identity and sexual orientation data for the first time ever. The public health care systems have used that data as the foundation to identify disparities, as well as to develop and implement disparity reduction plans. The brief includes selected highlights and summaries of each public health care system’s disparity reduction plan, common themes in disparity efforts across systems, and a description of the PRIME project requirements.
Providers can now use their secure Medi-Cal login to view and download PDF versions of remittance advice details (RADs) and Medi-Cal financial summaries on www.medi-cal.ca.gov. RADs, along with their embedded financial summary information, are available online sooner than in paper versions. The site offers up to six calendar weeks of current RADs for immediate download. Currently, historical RADs in PDF, dating back to April 2017, are available on the Medi-Cal website; a larger database will be built over time. When complete, three years of historical RADs will be available within one business day of a request.
Providers may submit printed versions of the online RADs as supporting documentation with claims inquiry and appeal forms. More information is available in the attached flyer.
The Centers for Medicare & Medicaid Services (CMS) has released the attached informational bulletin describing its plans for enforcement of the Medicaid Home Health final rule. The rule expands coverage for medical supplies, equipment and appliances under the Medicaid (Medi-Cal) home health benefit. The rule was effective on July 1, 2016, but CMS delayed the compliance date for up to two years — based on state legislative cycles — recognizing that states are experiencing operational and budgetary issues as they implement the rule.
The bulletin states CMS’ intent to work with states on a case-by-case basis to provide flexibility for certain provisions of the rule. It also clarifies which provisions of the rule are not subject to enforcement flexibility. CMS asks states to contact it by May 31, 2018, to request flexibility.
The Centers for Medicare & Medicaid Services (CMS) recently issued a proposed rule that would provide states with greater flexibility in how they meet access to care requirements within the Medicaid program.
The proposed rule addresses concerns associated with the 2015 final rule — which CHA commented on — that requires states proposing to reduce or restructure Medicaid fee-for-service payment rates to collect data through an Access Monitoring Review Plan and solicit input on the potential impact on beneficiaries’ access to care.
CMS proposes to exempt states with an overall Medicaid managed care penetration rate of 85 percent or greater from most fee-for-service access monitoring requirements; California’s current Medi-Cal managed care penetration rate is 80 percent.
CHA has developed interactive maps displaying hospital data from across the state. Featuring 2016 annual data from the Office of Statewide Health Planning and Development, the maps allow users to find information for specific geographic areas, including Senate districts, Assembly districts, congressional districts and counties. The maps include data on:
The Emergency Medical Services Authority (EMSA) has issued a proposed rule that would establish guidelines for local Emergency Medical Services Systems for Children (EMSC) programs. Currently, 21 of 33 local emergency medical services agencies have adopted such programs, which are intended to ensure that children receive appropriate emergency medical services. The proposed rule would clarify the requirements for local emergency medical services agencies to develop and implement EMSC programs into their plans.
In addition, the rule would create quality improvement assurance models and outline specific requirements for pediatric facility designation. The proposal also outlines the necessary resources pre-hospital providers and hospital emergency departments should obtain to adequately provide medical services to pediatric patients, from neonates to adolescents. EMSA states that the goals of this rule are to “provide standards for establishing statewide consistency in policy and program elements, support coordination of limited resource of pediatric specialty centers, and improve pediatric patient care within the California EMSC programs.” More information is available in the attached Notice of Proposed Rulemaking.
The Medicaid and CHIP Payment and Access Commission (MACPAC) issued its March 2018 Report to Congress on Medicaid and the Children’s Health Insurance Program. The report focuses on two topics of high interest to Congress – managed care and telehealth — and covers the mandated analysis of Medicaid disproportionate share hospital allotments.
MACPAC recommends amending and revising three separate legal authorities under the Social Security Act to reduce administrative burdens for states implementing Medicaid managed care programs. It suggests extending the approval and renewal periods for all Section 1915(b) waivers from two to five years; permitting Section 1915(c) waivers for beneficiaries’ freedom of choice and selective contracting; and amending Section 1932(a)(2) to allow states to require beneficiaries to enroll in Medicaid managed care programs under state plan authority.
The Integrated Healthcare Association has released the second edition of its California Regional Health Care Cost & Quality Atlas, reflecting multi-payer data by geographic region — including commercial insurance, Medicare and Medi-Cal — on more than 30 standardized measures of health care quality, cost, patient cost sharing and utilization. Developed with support from the California Health Care Foundation and the California Health and Human Services Agency, the atlas includes information about care provided in 2013 and 2015, just before and after the Affordable Care Act (ACA) coverage expansions took effect. The updated atlas incorporates new characteristics to allow comparison among market segments, subpopulations and the overall insured population. The new characteristics include large group, small group and individual coverage; self-insured employers; Covered California; risk-sharing arrangements; accountable care organizations; and clinical condition cohorts.
According to the data, clinical quality in 2015 varied across the state’s 19 geographic regions by an average of 25 percentage points, and costs ranged from 22 percent below the statewide average to 29 percent above.
On Feb. 9, the House of Representatives passed a bill delaying the Medicaid disproportionate share hospital (DSH) payment reduction until Oct. 1, 2020. Previously, the Department of Health Care Services (DHCS) had implemented the DSH reductions on Oct. 1, 2017, to comply with current law.
As a result of the delay, DHCS will now reverse the reductions that have taken place since Oct. 1, 2017, and has updated the program payments to add the previous reductions into the next payment, according to hospital group, as follows:
Private hospitals will see the increase in their December-January DSH replacement payment, scheduled for March 1.
Non-designated public hospitals will see the increase during the February-March 2018 DSH payment, scheduled for April 26.
University of California hospitals will see the increase in the round 3 DSH payments, scheduled for April 5 for certified public expenditures, and April 19 for intergovernmental transfers.
Global Payment Program hospitals will see the increase in their prior year 3, quarter 3 payments, scheduled for April 15.