text:
(a) Notwithstanding any other law, subject to subdivisions (e) and (g), the department may enter into one or more comprehensive risk contracts with an alternate health care service plan (AHCSP) to serve as a primary Medi-Cal managed care plan for eligible beneficiaries described in subdivision (b) in geographic regions that are designated by the department pursuant to subdivision (c) and that are regions in which the AHCSP already provides commercial coverage in the individual, small group, or large group market.

(b) The following beneficiary populations enrolling in Medi-Cal managed care shall be eligible to enroll, or choose to maintain their enrollment, in an AHCSP contracted with the department pursuant to subdivision (a):

(1) A beneficiary who was previously a member of the AHCSP as their Medi-Cal managed care plan at any point from January 1, 2023, to December 31, 2023, inclusive.

(2) An existing member of the AHCSP who is transitioning into Medi-Cal managed care.

(3) A beneficiary who was a member of the AHCSP at any time during the 12 months preceding the effective date of the beneficiary’s Medi-Cal eligibility.

(4) A beneficiary with an AHCSP family linkage.

(5) A beneficiary who was previously enrolled in a primary Medi-Cal managed care plan other than the AHCSP at any point from January 1, 2023, to December 31, 2023, inclusive, but who was assigned to, and made the responsibility of, the AHCSP under a subcontract with the Medi-Cal managed care plan.

(6) A dual eligible beneficiary residing in a geographic region approved by the department for purposes of this subdivision and for which the department has contracted with the AHCSP pursuant to subdivision (a).

(7) A beneficiary who is in foster care in this state or is otherwise eligible on the basis of their receipt of services through a child welfare agency pursuant to Section 300 or a former foster youth eligible pursuant to Section 14005.28 residing in a geographic region for which the department has contracted with the AHCSP pursuant to subdivision (a). A beneficiary who was previously enrolled in the AHCSP as their primary Medi-Cal managed care plan under this paragraph may remain in the AHCSP even if the beneficiary is no longer receiving services through a child welfare agency pursuant to Section 300.

(8) (A) A beneficiary not listed in paragraphs (1) to (7), inclusive, who resides in a geographic region for which the department has contracted with the AHCSP pursuant to subdivision (a) and is assigned to the AHCSP according to the department’s default enrollment process for beneficiaries that fail to elect a Medi-Cal managed care plan in accordance with Section 14016.5. The department shall annually determine the rate of default enrollment for beneficiaries into the AHCSP in each applicable county or geographic region based on the AHCSP’s projected capacity.

(B) If the default enrollment into the AHCSP described in subparagraph (A) results in a default rate of 20 percent or higher for two consecutive months in an applicable county or counties as described in subdivision (c) of Section 14016.55, the department may elect not to conduct a one-time beneficiary survey, notwithstanding the requirement of subdivision (c) of Section 14016.55.

(c) Notwithstanding any other law, the department may contract with an AHCSP as a Medi-Cal managed care plan in any geographic region of the state for which federal approval is available and received pursuant to subdivision (g), for which the AHCSP maintains appropriate licensure or an approved exemption from the Department of Managed Health Care, and in which the AHCSP already provides commercial coverage in the individual, small group, or large group market. To the extent permissible under federal law, the department may enter into either a single comprehensive risk contract for all geographic areas where the AHCSP is approved to operate as a Medi-Cal managed care plan or multiple contracts to serve the different geographic areas. If the department enters into a single comprehensive risk contract, capitation rates shall be determined on a county or regional basis.

(1) The AHCSP shall not deny enrollment to any individual eligible pursuant to subdivision (b) unless the department or the Department of Managed Health Care has ordered the AHCSP to cease enrollment in an applicable service area.

(2) (A) The AHCSP shall not, on its own, disenroll any eligible beneficiary described in subdivision (b).

(B) The Health Care Options Program shall disenroll any member of an AHCSP if the member meets any one of the reasons for disenrollment enumerated in Section 53891 of Title 22 of the California Code of Regulations, except that the Health Care Options Program shall not disenroll a member who meets the conditions described in subdivision (f) of Section 53845 of Title 22 of the California Code of Regulations. The Health Care Options Program shall follow the disenrollment process described in Section 53889 of Title 22 of the California Code of Regulations.

(3) Except for those standards and requirements relating to beneficiary enrollment that the department determines are inapplicable to the AHCSP, the comprehensive risk contract or contracts with the AHCSP pursuant to this section shall include the same standards and requirements as those for other Medi-Cal managed care plans, including any requirements imposed by the CalAIM Terms and Conditions, as the term is defined in subdivision (c) of Section 14184.101, and any terms and conditions imposed by a successor federal waiver or demonstration project and the same standards and requirements as for other Medi-Cal managed care plans in effect at that time.

(4) (A) In addition to the comprehensive risk contract or contracts described in this section, the AHCSP shall enter into a memorandum of understanding with the department to memorialize any standards or requirements that are in addition to, or different than, those imposed on other Medi-Cal managed care plans as described in paragraph (3). Upon execution, the department shall post the memorandum of understanding on its internet website.

(B) The memorandum of understanding entered into pursuant to subparagraph (A) shall include, but need not be limited to, the AHCSP’s commitment to increase enrollment of new Medi-Cal members over the course of the relevant contract terms and any requirements related to the AHCSP’s collaboration with, and support of, applicable safety net providers, including federally qualified health centers (FQHCs), as follows:

(i) The AHCSP shall work with FQHCs in AHCSP service areas selected by the AHCSP and the department, at the request of the FQHC, to provide assistance with population health management and clinical transformation.

(ii) The department and the AHCSP shall identify the highest need specialties and geographic areas where the AHCSP will provide, using the AHCSP’s physicians, outpatient specialty care and services to address related needs, including, but not limited to, diagnostic testing and outpatient procedures for Medi-Cal beneficiaries who are not enrollees of the AHCSP.

(C) Within six months after the end of each applicable rating period for which the department contracts with the AHCSP pursuant to this section, commencing with the 2024 calendar year, the department shall publish a report describing the implementation of those standards and requirements imposed by the memorandum of understanding for the applicable rating period and post the report on its internet website.

(5) During the relevant terms of the contracts entered into pursuant to subdivision (a), the AHCSP shall periodically consult with counties and other affected local stakeholders in those geographic regions in which the AHCSP operates, in a form and manner as directed by the department. The AHCSP shall enter into memoranda of understanding with local agencies pursuant to Medi-Cal managed care contract requirements.

(d) It is the intent of the Legislature that Medi-Cal beneficiaries enrolled in the AHCSP be assigned to a primary care physician who is contracted with the AHCSP through its exclusive contracts with a single medical group subject to the limitations imposed by federal law.

(e) Except when an AHCSP was already contracted with the department as a Medi-Cal managed care plan as of January 1, 2022, contracts entered into pursuant to subdivision (a) shall be effective no sooner than January 1, 2024.

(f) Before the initial effective date of a contract entered into pursuant to this section, the department shall conduct an assessment of the AHCSP’s readiness to meet behavioral health network adequacy requirements pursuant to Medi-Cal managed care contract requirements and Section 14197 and shall post those findings on the department’s internet website, including any corrective action plan imposed due to noncompliance and the department’s basis for that finding of noncompliance, if any.

(g) The department shall seek any federal approvals it deems necessary to implement this section. This section shall be implemented only to the extent that any necessary federal approvals are obtained and federal financial participation is available and is not otherwise jeopardized.

(h) The capitation rates established for contracts entered into pursuant to subdivision (a) shall be set annually in accordance with Section 14301.1. It is the intent of the Legislature that all Medi-Cal managed care plans be paid in an actuarially sound manner according to the projected acuity of the populations they serve under contract with the department.

(i) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section, in whole or in part, by means of plan letters or other similar instructions, without taking any further regulatory action.

(j) Notwithstanding any other law, contracts entered into or amended pursuant to this section shall be exempt from Chapter 6 (commencing with Section 14825) of Part 5.5 of Division 3 of Title 2 of the Government Code, Section 19130 of the Government Code, Part 2 (commencing with Section 10100) of Division 2 of the Public Contract Code, and the State Administrative Manual, and shall be exempt from the review or approval of any division of the Department of General Services.

(k) For purposes of this section, the following definitions shall apply:

(1) “Alternate health care service plan” means a nonprofit health care service plan with at least 4,000,000 enrollees statewide that owns or operates pharmacies and provides professional medical services to enrollees in specific geographic regions through an exclusive contract with a single medical group in each specific geographic region in which it is licensed pursuant to the Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code). If the AHCSP cannot comply with any terms of the Knox-Keene Health Care Service Plan Act, it shall request a modification of its license from the Department of Managed Health Care pursuant to Section 1352 of the Health and Safety Code, including regulations promulgated thereunder, or request an exemption from the Department of Managed Health Care pursuant to subdivision (b) of Section 1343 of the Health and Safety Code.

(2) “AHCSP family linkage” includes when any of the following individuals are current AHCSP members on the effective date of the beneficiary’s Medi-Cal eligibility.

(A) A beneficiary’s spouse or domestic partner.

(B) A beneficiary’s dependent child, foster child, or stepchild under 26 years of age.

(C) A beneficiary’s dependent who is disabled and over 21 years of age.

(D) A parent or stepparent of a beneficiary under 26 years of age.

(E) A beneficiary’s grandparent, guardian, foster parent, or other relative of a beneficiary under 26 years of age with appropriate documentation of familial relationship, as determined by the department.

(3) “Comprehensive risk contract” has the same meaning as set forth in Section 438.2 of Title 42 of the Code of Federal Regulations.

(4) “Dual eligible beneficiary” has the same meaning as set forth in paragraph (1) of subdivision (f) of Section 14184.200.

(5) “Medi-Cal managed care plan” has the same meaning as set forth in subdivision (j) of Section 14184.101.

(6) “Member” means an enrollee of the AHCSP. A beneficiary is not an enrollee solely by virtue of receiving a service through an AHCSP provider or AHCSP-contracted provider.

(l) In 2026, the department shall report to the health and fiscal committees of the Legislature to provide an update on the implementation of this section.

history: (History: Added by Stats. 2022, Ch. 73, Sec. 4. (AB 2724) Effective January 1, 2023.)

article: 6.3. Medi-Cal Managed Care Plans


kind: section

code: WIC

text:
(a) Notwithstanding any other law, for covered benefits under its contract, as applicable, a Medi-Cal managed care plan shall comply with all of the following:

(1) Make a good faith effort to contract with at least one National Cancer Institute (NCI)-designated comprehensive cancer center, site affiliated with the NCI Community Oncology Research Program (NCORP), or qualifying academic cancer center, within its contracted provider network and its subcontracted provider network, if applicable, within each county in which the Medi-Cal managed care plan operates, for provision of services to any eligible enrollee diagnosed with a complex cancer diagnosis. For purposes of this paragraph, the NCI-designated comprehensive cancer center, NCORP-affiliated site, or qualifying academic cancer center shall enroll in the Medi-Cal program if there is a state-level enrollment pathway, or the Medi-Cal managed care plan shall vet the qualifications of the facility to ensure they can meet the standards of participation required to contract with a Medi-Cal managed care plan.

(2) (A) Allow any eligible enrollee diagnosed with a complex cancer diagnosis to request a referral to receive medically necessary services through any of the following in-network providers unless the enrollee chooses a different cancer treatment provider:

(i) An NCI-designated comprehensive cancer center.

(ii) An NCORP-affiliated site.

(iii) A qualifying academic cancer center.

(B) (i) If the Medi-Cal managed care plan is unsuccessful in its good faith contracting efforts pursuant to paragraph (1), the Medi-Cal managed care plan shall allow an enrollee to request a referral to receive medically necessary services through an out-of-network NCI-designated comprehensive cancer center, out-of-network NCORP-affiliated site, or out-of-network qualifying academic cancer center, unless the enrollee chooses a different cancer treatment provider.

(ii) Clause (i) shall only apply if the Medi-Cal managed care plan and the out-of-network NCI-designated comprehensive cancer center, out-of-network NCORP-affiliated site, or out-of-network qualifying academic cancer center come to agreement with respect to payment.

(3) (A) After approving a referral request pursuant to paragraph (2), allow an eligible enrollee diagnosed with a complex cancer diagnosis to access oncology, hematology, or other relevant specialists through a contracted NCI-designated comprehensive cancer center, a contracted NCORP-affiliated site, or a contracted qualifying academic cancer center, for the enrollee’s condition and identified needs as medically necessary.

(B) If the NCI-designated comprehensive cancer center, NCORP-affiliated site, or qualifying academic cancer center refers an enrollee with a complex cancer condition to an out-of-network specialist pursuant to subparagraph (B) of paragraph (2), this paragraph shall only apply if the Medi-Cal managed care plan and the out-of-network specialist come to an agreement with respect to payment.

(4) A denial of an enrollee’s referral request shall be based upon a determination by the treating provider that the request to receive services at an NCI–designated comprehensive cancer center, or an NCORP-affiliated site, or a qualifying academic cancer center is not medically necessary, the requested services are not available at, or not applicable to the enrollee’s cancer diagnosis at, the requested NCI-designated comprehensive cancer center, NCORP-affiliated site, or qualifying academic cancer center, or the NCI-designated comprehensive cancer center, NCORP-affiliated site, or qualifying academic cancer center is an out-of-network provider and the Medi-Cal managed care plan and the out-of-network NCI-designated comprehensive cancer center, NCORP-affiliated site, or qualifying academic cancer center are unable to come to agreement with the respect to payment.

(5) Ensure that the services of an NCI-designated comprehensive cancer center, NCORP-affiliated site, or qualifying academic cancer center available to an eligible enrollee are sufficient in amount, duration, and scope as medically necessary for the treatment of the enrollee’s condition.

(6) Refrain from arbitrarily denying or reducing the amount, duration, or scope of required services solely because of diagnosis, type of illness, or condition of the enrollee.

(b) A Medi-Cal managed care plan shall notify all enrollees of their right to request a referral to access care through an NCI-designated comprehensive cancer center, NCORP-affiliated site, or qualifying academic cancer center, if they are diagnosed with a complex cancer diagnosis.

(c) For the purposes of this section, the following definitions apply:

(1) (A) “Complex cancer diagnosis” means a diagnosis for which there is no standard FDA-approved treatment or for which known highly effective therapy for metastatic cancer has failed and any of the following diagnoses: hematological malignancies, acute leukemia, advanced, relapsed, refractory non-Hodgkin lymphoma and multiple myeloma, including BPDCN and T-cell leukemias and lymphomas, and advanced stage, relapsed solid tumors refractory to standard FDA-approved treatment options, advanced stage rare solid tumors for which there is no known effective standard treatment options, or any other condition as determined pursuant to paragraph (2) of subdivision (d). “Advanced stage” cancer means stage IV metastatic cancer.

(B) The department is authorized to periodically update and further define “complex cancer diagnosis” pursuant to the process outlined in subdivision (d).

(2) “Eligible enrollee” means an individual enrolled with a particular Medi-Cal managed care plan who receives a complex cancer diagnosis.

(3) “National Cancer Institute (NCI) Community Oncology Research Program (NCORP)-affiliated site” is a cancer center that has received an approved grant from NCI through NCORP that provides cancer clinical trials and care delivery studies.

(4) “NCI-designated comprehensive cancer center” is a cancer center that meets ongoing standards for cancer prevention, clinical services, and research, as determined by regular reviews and evaluations by NCI.

(5) “Qualifying academic cancer center” is a research and clinical cancer center that meets all the following criteria:

(A) It is an institution with a medical oncology or hematology subspecialty expertise in each of the diagnoses included in paragraph (1).

(B) It has a portfolio of phases 1, 2, and 3 clinical trials available for eligible enrollees.

(C) It provides fellowship programs in medical oncology, hematology or hematological oncology, radiation oncology, or a surgical oncology specialty.

(D) It provides inpatient and outpatient supportive care services.

(E) It covers clinical, anatomic, and molecular pathology with subspecialty expertise for each of the cancer types included in paragraph (1).

(F) It provides a program accredited by the American College of Surgeons (ACS) Commission on Cancer (CoC).

(G) It has accreditation for the main campus by the Foundation for the Accreditation of Cellular Therapy.

(d) (1) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section, in whole or in part, by means of all-county letters, plan letters, provider bulletins, information notices, or other similar guidance, without taking further regulatory action.

(2) The department, in consultation with stakeholders, shall develop a process for updating and further defining a “complex cancer diagnosis” on a periodic basis.

(e) The department shall seek any federal approvals it deems necessary to implement this section. This section shall be implemented only to the extent that any necessary federal approvals are obtained and federal financial participation is available and is not otherwise jeopardized.

(f) For purposes of implementing this section, the department may enter into an exclusive or nonexclusive contract, or amend existing contracts, on a bid or negotiated basis. Contracts entered into or amended pursuant to this section shall be exempt from Part 2 (commencing with Section 10100) of Division 2 of the Public Contract Code, and shall be exempt from the review or approval of any division of the Department of General Services.

history: (History: Amended by Stats. 2023, Ch. 131, Sec. 232. (AB 1754) Effective January 1, 2024.)

division: 9. PUBLIC SOCIAL SERVICES

chapter: 7. Basic Health Care

article: 6.3. Medi-Cal Managed Care Plans

path: 9. PUBLIC SOCIAL SERVICES > 7. Basic Health Care > 6.3. Medi-Cal Managed Care Plans


text:
(a) The department may, at its discretion, align relevant terms of its contract with a Medi-Cal behavioral health delivery system with the terms of its contract with a Medi-Cal managed care plan, as defined in subdivision (j) of Section 14184.101, for those requirements that apply to both entities. Requirements that apply to both entities include, but are not limited to, all of the following:

(1) Organization and administration of the plan, including key administrative staffing requirements.

(2) Financial information.

(3) Information systems.

(4) Quality improvement systems.

(5) Utilization management.

(6) Provider network.

(7) Provider compensation arrangements.

(8) Provider oversight and monitoring.

(9) Access and availability of services, including, but not limited to, reporting of waitlists for behavioral health services or attesting to no waitlists.

(10) Care coordination and data sharing.

(11) Member services.

(12) Member grievances and appeals data.

(13) Reporting requirements.

(14) Other contractual requirements determined by the department.

(b) The department shall establish minimum quality metrics to measure and evaluate the quality and efficacy of services and programs covered under Medi-Cal behavioral health delivery systems.

(c) (1) Each Medi-Cal behavioral health delivery system shall report annually to the county board of supervisors on utilization, quality, patient care expenditures, and other data as determined by the department.

(2) The board of supervisors shall annually submit an attestation to the department that the county is meeting its obligations to provide realigned programs and services pursuant to clauses (i), (iv), and (v) of subparagraph (B) of paragraph (16) of subdivision (f) of Section 30025 of the Government Code.

(d) (1) Notwithstanding any other state or local law, including, but not limited to, Section 5328 of this code and Sections 11812 and 11845.5 of the Health and Safety Code, the sharing of health, social services, housing, and criminal justice information, records, and other data with and among the department, other state departments, including the State Department of Public Health and the State Department of Social Services, Medi-Cal managed care plans, as defined in subdivision (j) of Section 14184.101, Medi-Cal behavioral health delivery systems, as defined in subdivision (i) of Section 14184.101, counties, health care providers, social services organizations, care coordination and case management teams, and other authorized provider or plan entities, and contractors of all of those entities, shall be permitted to the extent necessary and consistent with federal law.

(2) The department shall issue guidance identifying permissible data-sharing arrangements.

(e) For purposes of this section, the term “Medi-Cal behavioral health delivery system” means an entity or local agency that contracts with the department to provide covered behavioral health Medi-Cal benefits pursuant to Section 14184.400 and Chapter 8.9 (commencing with Section 14700) or a county Drug Medi-Cal Organized Delivery System pilot authorized under the CalAIM Terms and Conditions and described in Section 14184.401 or authorized under the Medi-Cal 2020 Demonstration Project Act pursuant to Article 5.5 (commencing with Section 14184).

(f) This section shall be implemented only to the extent that necessary federal approvals have been obtained and federal financial participation is available and not otherwise jeopardized.

(g) The department shall implement this section no later than January 1, 2027.

history: (History: Added by Stats. 2023, Ch. 790, Sec. 112. (SB 326) Effective April 17, 2024. Approved in Proposition 1 at the March 5, 2024, election. Operative January 1, 2025, pursuant to Sec. 117 of Proposition 1.)

article: 6.3. Medi-Cal Managed Care Plans


text:
(a) A hospital or its successor entity, that has received funds pursuant to Section 14198 shall maintain burn and trauma services and continue to provide medical services to beneficiaries of Medi-Cal or a successor program through the year 2028.

(b) The state and a hospital subject to this section shall negotiate in good faith to ensure continued hospital participation in the Medi-Cal program and to ensure adequate access to services for Medi-Cal patients.

history: (History: Added by Stats. 1998, Ch. 314, Sec. 1. Effective August 19, 1998.)

path: 9. PUBLIC SOCIAL SERVICES > 7. Basic Health Care > 6.5. Regional Burn and Trauma Center Program


text:
(a) The Regional Burn and Trauma Center Fund is hereby created in the State Treasury, under the administrative control of the State Department of Health Services, for the purposes specified in Section 14198 upon appropriation by the Legislature. Except as otherwise limited by this section, the fund shall consist of the following:

(1) All public moneys transferred by public agencies to the department for deposit into the fund, as permitted under Section 433.51 of Title 42 of the Code of Federal Regulations or any other applicable federal medicaid laws.

(2) All private moneys donated by private individuals or entities to the department for deposit in the fund, as permitted under applicable federal medicaid laws and regulations. Private donations may come from private individuals, foundations, or entities that do not meet the definition of a provider entity, as contained in federal regulatory law.

(3) Any amounts appropriated by the Legislature for this program may be transferred to the fund.

(4) Any interest that accrues on amounts in the fund.

(b) Any public moneys transferred by public agencies, or private moneys donated by private individuals or entities to the department for deposit in the fund, shall be expended before any state appropriation is utilized as the nonfederal match of the supplemental reimbursement. Total combined funds made available under this section shall not exceed fifty million dollars ($50,000,000). It is the intent of the Legislature that funding from the General Fund shall not exceed twenty-five million dollars ($25,000,000).

(c) Unless otherwise prohibited by law, any public or private agency transferring moneys to the fund may utilize for that purpose any revenues, grants, or allocations received from the state for health care programs or purposes. Unless otherwise prohibited by law, a public or private agency may also utilize its general operating funds, or any other public or private moneys or revenues for purposes of transfers to the fund.

(d) The department shall have discretion as to whether to accept moneys offered to the department for deposit in the fund. If the department accepts moneys pursuant to this section, the department shall obtain federal matching funds to the full extent permitted by law. The department shall accept only those funds that are certified by the transferring entity or donating entity as qualifying for federal financial participation under the terms of the Medicaid Voluntary Contributions and Provider-Specific Tax Amendments of 1991 (Public Law 102-234), or Section 433.51 of Title 42 of the Code of Federal Regulations, as applicable, and may return any funds transferred or donated in error.

(e) Moneys in the fund shall be used as the source for the nonfederal share of payments to the Regional Burn and Trauma Center to be constructed pursuant to this article. Moneys shall be allocated from the fund by the department and matched by federal funds in accordance with customary Medi-Cal accounting procedures for purposes of payments under subdivision (e). Distributions from the fund shall be supplemental to any and all other amounts that this hospital would have received under the selective provider contracting program.

(f) For purposes of recognizing the Regional Burn and Trauma Center replacement costs incurred for services rendered to Medi-Cal beneficiaries, payments from the fund shall be negotiated between the California Medical Assistance Commission and the entity contracting under this article. Payments from the fund shall be used solely for the purposes identified in the contract between the hospital and the state.

(g) The state shall be held harmless for any federal disallowance resulting from this section. A hospital receiving supplemental reimbursement pursuant to this section shall be liable for any reduced federal financial participation resulting from the implementation of this section with respect to that hospital. The state may recoup any federal disallowance from the hospital.

(h) Funds available pursuant to this article shall only be used for projects, or for that portion of projects, that are available and accessible to Medi-Cal patients treated under this article or by successor programs.

article: 6.5. Regional Burn and Trauma Center Program


text:
(a) The Legislature finds and declares the following:

(1) Beginning January 1, 2014, many low-income individuals will be eligible for Medi-Cal coverage pursuant to federal law, as part of health care reform.

(2) In implementing this expansion of Medi-Cal coverage, it is critical to maintain the role of county public hospital health systems that have traditionally served Medi-Cal and uninsured beneficiaries to ensure adequate access to care is available for the new Medi-Cal members, and to preserve the policy goal to support and strengthen traditional safety net providers who treat a high volume of uninsured and Medi-Cal patients.

(b) For purposes of this section, the following definitions shall apply:

(1) “County public hospital health system” shall have the meaning provided in subdivision (f) of Section 17612.2.

(2) “Default members” means newly eligible beneficiaries enrolled in each Medi-Cal managed care plan who do not affirmatively select a primary care provider as part of the enrollment process.

(3) “Enrollment target” means the number of newly eligible beneficiaries assigned to primary care providers within a county public hospital health system, not to exceed the number of unduplicated Low Income Health Program and uninsured patient count in the county public hospital health system. The unduplicated patient count shall be certified by the county public hospital health system and provided to the department, along with its proposed enrollment target, by November 30, 2013. The county public hospital health system may notify the department of a proposed reduction to its enrollment target based on its capacity to accept new patients. A standardized protocol for determining the target shall be developed by the department in consultation with the public hospital health system counties.

(4) “Low Income Health Program” shall mean the LIHP as defined in subdivision (c) of Section 15909.1.

(5) “Medi-Cal managed care plan” means an organization or entity that enters into a contract with the department pursuant to Article 2.7 (commencing with Section 14087.3), Article 2.8 (commencing with Section 14087.5), Article 2.81 (commencing with Section 14087.96), Article 2.91 (commencing with Section 14089), or Chapter 8 (commencing with Section 14200).

(6) “Newly eligible beneficiaries” shall have the meaning provided in subdivision (s) of Section 17612.2.

(7) “Primary care provider” means a primary care physician or nonphysician medical practitioner, medical group, clinic, or a medical home.

(8) “Public hospital health system county” shall have the meaning provided in subdivision (u) of Section 17612.2.

(c) Subject to subdivision (d), default members who reside in a public hospital health system county shall be assigned by each Medi-Cal managed care plan in the county to a primary care provider in accordance with the following:

(1) Throughout the three-year period ending on December 31, 2016, at least 75 percent of default members shall be assigned by each Medi-Cal managed care plan to primary care providers within the county public hospital health system until the county public hospital health system meets its enrollment target.

(2) Following the expiration of the three-year period set forth in paragraph (1), at least 50 percent of default members shall be assigned by each Medi-Cal managed care plan to primary care providers within the county public hospital health system until the county public hospital health system meets its applicable enrollment target.

(3) Paragraphs (1) and (2) shall not apply with respect to a county public hospital health system during any time period in which the county public hospital health system meets or exceeds its applicable target. For time periods during which paragraphs (1) and (2) do not apply, default members shall be assigned to primary care providers in the same manner as other Medi-Cal members of the Medi-Cal managed care plan who do not affirmatively select primary care providers. Medi-Cal managed care plans shall not modify the assignment procedures due to the default assignment requirements of this section with respect to primary care providers within the county public hospital health system.

(4) In implementing the assignment process set forth in paragraphs (1) and (2), to the extent legally permissible and consistent with federal and state privacy and patient confidentiality laws, each Medi-Cal managed care plan shall first assign to a primary care provider within the county public hospital health system those default members who have accessed care within the county public hospital health system two or more times within the past 12 months. The department and the county public hospital health systems shall work together to share patient information in order to provide the Medi-Cal managed care plans with data demonstrating which default members have accessed the county public hospital health system providers prior to assignment to a primary care provider.

(5) If at any time a county public hospital health system notifies a contracted Medi-Cal managed care plan that it has reached its maximum capacity for the assignment of default members, the requirements set forth in paragraphs (1) and (2) shall not apply to the Medi-Cal managed care plan so notified. Once the county public hospital health system notifies a Medi-Cal managed care plan that it has capacity to accept assignment of default members, the requirements set forth in paragraphs (1) and (2) shall apply effective on the first day of the month following that notice.

(6) A Medi-Cal managed care plan shall not assign default members to a primary care provider within the county public hospital health system if that primary care provider has notified the Medi-Cal managed care plan that it does not have capacity to accept new patients.

(d) The default process described in this section shall not apply to Low Income Health Program enrollees subject to Section 14005.61.

(e) Nothing set forth in this section shall alter, reduce, or modify in any manner the way in which Medi-Cal managed care plans assign other Medi-Cal members to the county public hospital health systems.

(f) (1) The department shall modify its contracts with the Medi-Cal managed care plans in public hospital health system counties to include the assignment requirements set forth in this section.

(2) Each Medi-Cal managed care plan shall demonstrate and certify that it has contracts or other arrangements in place with county public hospital health systems that provide for implementing the requirements of this section. To the extent a Medi-Cal managed care plan is not compliant with any of the requirements of this section, the department shall reduce by 25 percent the default assignment into the Medi-Cal managed care plan with respect to all Medi-Cal beneficiaries, as long as the other Medi-Cal managed care plan or plans in that county have the capacity to receive the additional default membership.

(g) Nothing in this section shall modify the ability of newly eligible beneficiaries to select or change their primary care providers.

(h) The department shall seek any necessary federal approvals to implement the provisions of this section.

history: (History: Amended by Stats. 2013, Ch. 358, Sec. 6. (SB 98) Effective September 26, 2013.)

path: 9. PUBLIC SOCIAL SERVICES > 7. Basic Health Care > 6.6. Medicaid Expansion Under The Federal Affordable Care Act


text:
(a) Subject to subdivision (e), Medi-Cal managed care plans serving newly eligible beneficiaries, as defined in subdivision (s) of Section 17612.2, shall pay county public hospital health systems, as defined in subdivision (f) of Section 17612.2, for services provided to newly eligible beneficiaries in amounts that are no less than the cost of providing those services, including the cost of network and out-of-network services that are charged to or paid for by county public hospital health systems. For purposes of this requirement, the cost of providing services shall mean the amounts, including the federal and nonfederal share of all allowable costs, determined in a manner consistent with the cost claiming protocols developed for the federal Medicaid demonstration project authorized under Section 1115 of the Social Security Act entitled the “Bridge to Health Care Reform” (waiver number 11-W-00193/9), including protocols pending federal approval, and under Section 14166.8.

(b) Consistent with federal law, the capitation rates paid to Medi-Cal managed care plans for newly eligible beneficiaries shall be determined to reflect the obligations imposed by subdivision (a).

(c) (1) Prior to the execution of a change order or contract amendment between the department and a Medi-Cal managed care plan providing for coverage of newly eligible beneficiaries, the Medi-Cal managed care plan shall demonstrate and certify that it has contracts or other arrangements in place with county public hospital health systems that provide for payments for services meeting the requirements of subdivision (a).

(2) Each year, each Medi-Cal managed care plan shall provide to the department an accounting of the payments made to demonstrate compliance with subdivision (a). To the extent a Medi-Cal managed care plan is not compliant with any of the requirements of this section, the department shall reduce the default assignment into the Medi-Cal managed care plan with respect to all Medi-Cal beneficiaries by 25 percent, as long as the other Medi-Cal managed care plan or plans in the county have the capacity to receive the additional default membership.

(d) A Medi-Cal managed care plan shall not impose a fee or retention amount, or reduce other payments to a county public hospital health system, that would result in a direct or indirect reduction to the amounts required to be paid under subdivision (a).

(e) (1) If a nonfederal share is necessary with respect to the capitation rates described in subdivision (b), a county public hospital health system or affiliated governmental entity shall have the right to voluntarily provide intergovernmental transfers for the nonfederal share of expenditures for the capitation rates described in subdivision (b) with respect to the requirements in subdivision (a). Only if the county public hospital health system or affiliated governmental entity so chooses, the requirements in this section shall apply. Notwithstanding any other law, the state shall not assess the fee described in subdivision (d) of Section 14301.4, or any other similar fee. Nothing in this section shall be construed to require a county public hospital health system to provide the nonfederal share for expenditures for purposes other than those described in subdivision (a), or for expenditures that are otherwise for Medi-Cal managed care beneficiaries who do not receive services in the county public hospital health system.

(2) Within 12 months following the end of each fiscal year, a county public hospital system shall submit data to the department demonstrating the payments received from Medi-Cal managed care plans as required under subdivision (a). If the amount of the applicable intergovernmental transfer provided by a county public hospital system does not equal the nonfederal share of those payments, the county hospital system and the department shall adjust the amount of the intergovernmental transfer accordingly.

history: (History: Added by Stats. 2013, Ch. 24, Sec. 2. (AB 85) Effective June 27, 2013.)

article: 6.6. Medicaid Expansion Under The Federal Affordable Care Act


text:
The Legislature finds and declares all of the following:

(a) Qualified clinics, as defined in this article, are fundamental to the California health care safety net, as their mission is to provide primary and preventive care to low-income and underserved populations.

(b) Stability in the California qualified clinic workforce will further the Legislature’s efforts to manage the COVID-19 pandemic and address other public health issues that face Californians.

(c) Retention payments will help retain qualified health care workers, in particular registered nurses, licensed vocational nurses, licensed clinical social workers, licensed mental health workers, medical assistants, and advanced practice professionals.

history: (History: Added by Stats. 2022, Ch. 738, Sec. 19. (AB 204) Effective September 29, 2022.)

path: 9. PUBLIC SOCIAL SERVICES > 7. Basic Health Care > 7. Clinic Workforce Stabilization Retention Payment Program


text:
For purposes of this article, the following definitions apply:

(a) “Date of record” means a date determined by the department on which eligible employees are deemed to qualify for a retention payment, which shall be no later than 90 calendar days after the effective date of the act that added this article.

(b) “Department” means the State Department of Health Care Services.

(c) “Eligible employee” means a person who is employed by an eligible qualified clinic as of the date of record and is not a manager or supervisor, as defined in this article.

(d) “HCAI” means the Department of Health Care Access and Information.

(e) “Manager or supervisor” means a qualified clinic employee who meets all of the following criteria:

(1) Whose duties and responsibilities involve the management of the enterprise in which they are employed or of a customarily recognized department or subdivision thereof.

(2) Who customarily and regularly directs the work of two or more other employees of the enterprise in which they are employed or of a customarily recognized department or subdivision of that enterprise.

(3) Who has the authority to hire or fire other employees, or their suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight.

(4) Who customarily and regularly exercises discretion and independent judgment.

(5) Who is primarily engaged in duties that meet the test of the exemption. The activities constituting exempt work and nonexempt work shall be construed in the same manner as those items are construed in the following regulations under the Fair Labor Standards Act effective as of the date of this section: Sections 541.102, 541.104-111, and 541.115-116 of Title 29 of the Code of Federal Regulations. Exempt work shall include, for example, all work that is directly and closely related to exempt work and work that is properly viewed as a means for carrying out exempt functions. The work actually performed by the employee during the course of the workweek shall, first and foremost, be examined and the amount of time the employee spends on that work, together with the employer’s realistic expectations and the realistic requirements of the job, shall be considered in determining whether the employee satisfies this requirement.

(6) Who must earn a monthly salary equivalent to no less than two times the state minimum wage for full-time employment. “Full-time employment” is defined in subdivision (c) of Section 515 of the Labor Code as 40 hours per week.

(f) “Qualified clinic” means, and is inclusive of, FQHCs, FQHC look-alikes, free clinics, Indian health clinics, intermittent clinics, and rural health clinics, as defined in this subdivision. A qualified clinic shall be located in the State of California, with the exception of Tribal FQHCs and Indian health clinics, as specified in the definitions of FQHC and Indian health clinic set forth in this subdivision.

(1) “Federally qualified health center” or “FQHC” means any community or public federally qualified health center, including Tribal FQHCs, as defined in Section 1396d(l)(2)(B) of Title 42 of the United States Code, as well as FQHC look-alikes. This definition also covers Tribal FQHCs on tribal land adjacent to California in a neighboring state that provides services to American Indians and their families who reside in California.

(2) “FQHC look-alike” means an organization that does not receive an FQHC award, but is designated by the United States Health Resources and Services Administration as meeting FQHC program requirements, as set forth in Sections 1395x(aa)(4)(B) and 1396d(l)(2)(B) of Title 42 of the United States Code. For the purposes of this article, an FQHC look-alike is considered an FQHC and all references to FQHCs apply with equal force to FQHC look-alikes.

(3) “Free clinic” means a facility meeting the definition set forth in subparagraph (B) of paragraph (1) of subdivision (a) of Section 1204 of the Health and Safety Code.

(4) “Indian health clinic” means a health clinic that provides services to American Indians and their families who reside in California pursuant to the Indian Health Program, as set forth in Chapter 4 (commencing with Section 124575) of Part 4 of Division 106 of the Health and Safety Code, and Chapter 3.1 (commencing with Section 1500) of Division 1 of Title 17 of the California Code of Regulations. This definition also covers Indian health clinics on tribal land adjacent to California in a neighboring state that provides services to American Indians and their families who reside in California.

(5) “Intermittent clinic” means a facility meeting the definition set forth in subdivision (h) of Section 1206 of the Health and Safety Code that has been added to the provider master file pursuant to Section 14043.15 under the license of a clinic defined in paragraphs (1) to (4), inclusive.

(6) “Rural health clinic” or “RHC” means a facility meeting the definition set forth in Section 1396d(l)(1) of Title 42 of the United States Code.

article: 7. Clinic Workforce Stabilization Retention Payment Program


text:
(a) Upon appropriation by the Legislature of funds for this purpose, the department shall establish a clinic workforce stabilization retention payment program to provide funds to eligible qualified clinics to make retention payments to their eligible employees for the public purposes specified in Section 14199.70.

(b) The department shall determine the conditions and data reporting requirements for qualified clinics to be eligible to receive funds. Within 90 days of the effective date of the act that added this article, the department shall notify all qualified clinics of those conditions and requirements, as well as the relevant portions of this article, including, but not limited to, the date of record set by the department, the information qualified clinics are required to submit pursuant to subdivision (c), the methodology for calculation of funds to be distributed pursuant to subdivision (d), how to pay retention payments pursuant to subdivision (e), and the consequences of noncompliance pursuant to Section 14199.74.

(c) (1) Each qualified clinic that intends to request funding shall submit the following information to the department no later than 30 days after the date of record:

(A) The name and mailing address of each eligible employee.

(B) The employee’s professional license, certification, or registration, if applicable.

(C) Any other information as required by the department for purposes of implementing this article.

(2) The possession of a professional license, certification, or registration is not required for an employee to be eligible for a payment. All eligible employees, as defined in subdivision (c) of Section 14199.71, are eligible to receive payments.

(3) The information required by this section shall include an attestation, made under penalty of perjury, that the qualified clinic employee did not receive funds pursuant to the Hospital and Skilled Nursing Facility COVID-19 Retention Pay program set forth in Part 4.6 (commencing with Section 1490) of Division 2 of the Labor Code.

(d) The department shall distribute funds to each eligible qualified clinic based on the total number of eligible employees reported pursuant to subdivision (c). The amount of the payment shall be up to one thousand dollars ($1,000) per eligible employee, subject to available funding, and reduced on a pro rata basis if the requests exceed the amount of funds available. The department may distribute these funds to eligible qualified clinics using the existing Medi-Cal Checkwrite system.

(e) Within 60 days of receipt of funds from the department, a qualified clinic shall pay eligible employees a retention payment in the amount of up to one thousand dollars ($1,000) if no pro rata reduction is made pursuant to subdivision (d), or the pro rata reduced amount if a pro rata reduction is made pursuant to subdivision (d). An eligible employee who leaves employment between the date of record and the date a qualified clinic pays retention payments shall not be eligible for retention payments. Each qualified clinic that receives funds shall attest, in a form and manner specified by the department, and under penalty of perjury, that all funding received pursuant to this section, with the exception of any funding requested for eligible employees who left employment after the date of record, was provided to eligible employees within 60 days of receipt from the department. Each qualified clinic that receives funds shall immediately return to the department any funding received pursuant to this section that is not distributed within the timeline set forth in this subdivision, including funds that the department provided for eligible employees who left employment after the date of record.

(f) The department shall post on its internet website the amount each clinic site received, and the total number of eligible employees reported by each clinic pursuant to subdivision (c).

(g) A qualified clinic shall not use retention payment funding to supplant other payments from the qualified clinic to eligible employees.

history: (History: Amended by Stats. 2024, Ch. 40, Sec. 72. (SB 159) Effective June 29, 2024.)


text:
(a) (1) Except as required by federal law, any payment made pursuant to this article shall be exempt from any adjustments or deductions made to Medi-Cal payments to qualified clinics, including, but not limited to, provider withholds or provider payment reductions.

(2) Payments made pursuant to this article to qualified clinics shall not be considered payments for patient care or medical services.

(3) The HCAI, in consultation with appropriate stakeholders, shall release guidance to instruct qualified clinics how to report this revenue through the established clinical annual utilization reports, as required under Section 1216 of the Health and Safety Code.

(b) The department may enter into exclusive or nonexclusive contracts, or amend existing contracts, on a bid or negotiated basis for purposes of implementing this article. A contract entered into or amended pursuant to this subdivision shall be exempt from Chapter 6 (commencing with Section 14825) of Part 5.5 of Division 3 of Title 2 of the Government Code, Section 19130 of the Government Code, Part 2 (commencing with Section 10100) of Division 2 of the Public Contract Code, and from the State Administrative and State Contracting manuals, and shall be exempt from the review or approval of any division of the Department of General Services.

(c) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this article, in whole or in part, by means of information notices or other similar instructions, without taking any further regulatory action.

(d) This article is a state law within the meaning of Section 1621(d) of Title 8 of the United States Code.

(e) This article shall be implemented only to the extent that the department determines that federal financial participation under the Medi-Cal program is not jeopardized.

(f) Funds distributed to qualified clinics and payments made by those qualified clinics pursuant to this article shall not be factored into any reconciliation process or prospective payment system (PPS) rate calculation, including, but not limited to, the reconciliation process detailed in Section 14132.100 of this code and subdivision (bb) of Section 1396a of Title 42 of the United States Code, to the maximum extent permissible by law.


text:
(a) In the event of a dispute as to the status of an employee as an eligible employee, the retention payment amount, or a qualified clinic’s failure to make a retention payment, an eligible employee or a labor organization that represents the employee may write to the qualified clinic and request a review of the employee’s eligibility status, retention payment amount, or the qualified clinic’s failure to make a retention payment. The qualified clinic shall have 30 days to review the request, disclose to the employee the amount received from the department subject to the methodology described in subdivision (e) of Section 14199.72, and cure any alleged deficiency. In the event the qualified clinic cures a deficiency alleged by an employee, the employee shall not be entitled to any further damages or other relief.

(b) If the qualified clinic does not conclude the review described in subdivision (a) within 30 days of receipt of the review request, or does not cure the alleged deficiency within 30 days of receipt of the review request, the employee may file a complaint with the Labor Commissioner as provided in Section 98 of the Labor Code, or the employee may file an action in court to recover the deficiency. If the court finds that the qualified clinic is liable for failing to make a required retention payment, or to designate an employee for a retention payment, the qualified clinic shall be ordered to make full payment of the unpaid amount, plus interest at the rate of interest specified in subdivision (b) of Section 3289 of the Civil Code, which shall accrue from the date that the retention payment funds were transmitted to the qualified clinic by the department as provided in Section 14199.72, or from the date the qualified clinic should have designated the employee for the retention payment. A claim before the small claims court is not subject to joinder pursuant to Section 378 of the Code of Civil Procedure.

(c) Notwithstanding any other law, the department shall not be liable for any payment, interest, damages, or attorney’s fees and costs awarded to an employee pursuant to this section, and shall not be required to indemnify a qualified clinic for any liability the qualified clinic incurs pursuant to this section.


text:
(a) In serving as a conduit for payments under this article, qualified clinics are carrying out a state program. This article does not create a private right of action in any civil litigation against qualified clinics regarding the administration of the retention payment program and in the receipt and transmittal of retention payment program funds except as set forth in Section 14199.74.

(b) This article does not create a private right of action in any civil litigation or administrative proceeding against the state or the department or any other state agency or department.

(c) Notwithstanding any other law, retention payments paid out pursuant to Section 14199.72 are not wages as defined in Section 200 of the Labor Code.

(d) Except as provided in Sections 1493 and 1494 of the Labor Code, and notwithstanding any other law, qualified clinics, the state, and the department and any other state agency or department shall not be liable for damages awarded under Section 3294 of the Civil Code or Sections 2698 to 2699.5, inclusive, of the Labor Code, or other damages imposed primarily for the sake of example and by way of punishing the defendant, in any civil litigation related to the payments described in this article.


text: The provisions of this article are severable. If any provision of this article or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.


text:
The Legislature finds and declares all of the following:

(a) The Legislature continues to recognize that an enrollment-based managed care organization provider tax is an essential and necessary source of nonfederal funding for maintaining and improving access to care and reimbursement levels under, and maximizing federal financial participation for, the Medi-Cal program.

(b) The Legislature recognizes how the previous iterations of the managed care organization provider tax, in effect nearly continuously from July 1, 2016, enabled the state to provide ongoing funding for health care and prevention, while minimizing the need for any new reductions to the Medi-Cal program during the time periods when the tax was in effect.

(c) Implementation of a new managed care organization provider tax at the earliest possible effective date allowable under federal law will best position the state to maintain and improve access to care, maximize federal financial participation, and minimize the need for any new reductions to the Medi-Cal program.

(d) In furtherance of subdivisions (a) to (c), inclusive, it is the intent of the Legislature that the department implement a managed care organization provider tax effective April 1, 2023, to meet all of the following goals:

(1) Generate an amount of nonfederal funds for the Medi-Cal program that is greater than the nonfederal funds generated by the tax imposed pursuant to Article 6.8 (commencing with Section 14199.60).

(2) Comply with federal Medicaid requirements applicable to permissible health care-related taxes, including, but not limited to, Section 433.68 of Title 42 of the Code of Federal Regulations.

(3) Provide funding to support the health care delivery system with an emphasis on the impact to the Medi-Cal program.

(4) Minimize, to the extent possible, the need for any new reductions to the Medi-Cal program.

history: (History: Added by Stats. 2023, Ch. 13, Sec. 2. (AB 119) Effective June 29, 2023. Conditionally operative as prescribed by Section 14199.87. Conditionally inoperative on or before January 1, 2027, as prescribed by Section 14199.87. Repealed as of January 1, 2028, pursuant to Section 14199.87.)

path: 9. PUBLIC SOCIAL SERVICES > 7. Basic Health Care > 7.1. Managed Care Organization Provider Tax


text:
The following definitions shall apply for purposes of this article:

(a) “Base data source” means the quarterly financial statement filings or annual enrollment data submitted by health plans to the Department of Managed Health Care retrieved by the department no later than June 30, 2023, and supplemented by, as necessary, Medi-Cal enrollment data for the base year as maintained by the department and retrieved no later than June 30, 2023, and as modified by the department to account for known or anticipated changes that will affect Medi-Cal enrollment on or after January 1, 2024. However, if the department elects to update the base year pursuant to subdivision (b), “base data source” means the most recently available quarterly financial statement filings or annual enrollment data submitted by health plans to the Department of Managed Health Care for that updated base year, retrieved by the department, and supplemented by, as necessary, Medi-Cal enrollment data for the updated base year as maintained by the department, and as modified by the department to account for known or anticipated changes that will affect Medi-Cal enrollment.

(b) “Base year” means the 12-month period of January 1, 2022, through December 31, 2022. However, the department may elect to update the base year to the extent that it deems necessary to meet the requirements of federal law or regulations, to obtain or maintain federal approval, or to ensure federal financial participation is available or is not otherwise jeopardized.

(c) “Countable enrollee” means an individual enrolled in a health plan, as defined in subdivision (f), during a month of the base year according to the base data source. “Countable enrollee” does not include an individual enrolled in a Medicare plan, a plan-to-plan enrollee, as defined in subdivision (m), or an individual enrolled in a health plan pursuant to the Federal Employees Health Benefits Act of 1959 (Public Law 86-382) to the extent the imposition of the tax under this article is preempted pursuant to Section 8909(f) of Title 5 of the United States Code.

(d) “Department” means the State Department of Health Care Services.

(e) “Director” means the Director of Health Care Services.

(f) “Health care service plan” or “health plan” means a health care service plan, other than a plan that provides only specialized or discount services, that is licensed by the Department of Managed Health Care under the Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code) or a managed care plan contracted with the State Department of Health Care Services to provide full-scope Medi-Cal services.

(g) “Medi-Cal enrollee” means an individual enrolled in a health plan, as defined in subdivision (f), who is a Medi-Cal beneficiary for whom the department directly pays the health plan a capitated payment.

(h) “Medi-Cal per enrollee tax amount” means the amount of tax assessed per countable Medi-Cal enrollee within a Medi-Cal taxing tier.

(i) “Medi-Cal taxing tier” means a range of cumulative enrollment of countable Medi-Cal enrollees for the base year.

(j) “Other enrollee” means an individual enrolled in a health plan, as defined in subdivision (f), who is not a Medi-Cal beneficiary.

(k) “Other per enrollee tax amount” means the amount of tax assessed per countable other enrollee within an “other taxing tier.”

(l) “Other taxing tier” means a range of cumulative enrollment of countable other enrollees for the base year.

(m) “Plan-to-plan enrollee” means an individual who receives their health care services through a health plan pursuant to a subcontract from another health plan.

(n) “Tax period” means a period of not more than 12 months for which the tax authorized by this article is assessed, in accordance with the requirements described in Section 14199.84.

article: 7.1. Managed Care Organization Provider Tax


text:
(a) The Managed Care Enrollment Fund is hereby created in the State Treasury.

(b) All revenues, less refunds, derived from the taxes provided for in this article shall be deposited in the State Treasury to the credit of the Managed Care Enrollment Fund.

(c) Notwithstanding Section 16305.7 of the Government Code, any interest and dividends earned on moneys in the Managed Care Enrollment Fund shall be retained in the fund and used solely for the purpose specified in subdivision (d).

(d) Funds deposited in the Managed Care Enrollment Fund pursuant to this article shall, upon appropriation by the Legislature, be available to the department for the purpose of funding all of the following subcomponents to support the Medi-Cal program:

(1) The nonfederal share of increased capitation payments to Medi-Cal managed care plans accounting for their projected tax obligation pursuant to this article for the applicable fiscal year or years.

(2) The nonfederal share of Medi-Cal managed care rates for health care services furnished to children, adults, seniors and persons with disabilities, and persons dually eligible for the Medi-Cal program and the Medicare Program.

(3) Transfers to the Medi-Cal Provider Payment Reserve Fund established pursuant to Section 14105.200.

(e) The department shall provide an annual report to all health plans accounting for the funds deposited in, and expended from, the Managed Care Enrollment Fund, in a time and manner as deemed appropriate by the director. The report shall identify the taxes imposed on each health plan pursuant to this article and shall provide an itemized accounting of expenditures from the fund.

(f) Effective December 31, 2023, the Health Care Services Special Fund in the State Treasury, created pursuant to Section 14199.62, is hereby abolished. All moneys in the fund or moneys designated to be deposited to the fund shall be transferred to the Managed Care Enrollment Fund created pursuant to subdivision (a). Any remaining balance, assets, liabilities, and encumbrances of the Health Care Services Special Fund as of December 31, 2023, shall be transferred to, and become part of, the Managed Care Enrollment Fund.

(g) Notwithstanding any other law, the Controller may use the funds in the Managed Care Enrollment Fund for cashflow loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code.

history: (History: Added by Stats. 2023, Ch. 13, Sec. 2. (AB 119) Effective June 29, 2023. Conditionally operative as prescribed by Section 14199.87. Inoperative on date prescribed by Section 14199.103. Repealed one year after inoperative date, pursuant to Section 14199.103.)


text:
(a) The department shall determine for each health plan, using the base data source, all of the following:

(1) Total cumulative enrollment for the base year.

(2) Total Medicare cumulative enrollment for the base year.

(3) Total Medi-Cal cumulative enrollment for the base year.

(4) Total plan-to-plan cumulative enrollment for the base year.

(5) Total cumulative enrollment through the Federal Employees Health Benefits Act of 1959 (Public Law 86-382) for the base year.

(6) Total other cumulative enrollment for the base year that is not otherwise counted in paragraphs (2) to (5), inclusive.

(b) Notwithstanding any other provision in this article, the director may correct any identified material or significant error in the data, including, but not limited to, the overall cumulative enrollment, Medicare cumulative enrollment, Medi-Cal cumulative enrollment, plan-to-plan cumulative enrollment, cumulative enrollment through the Federal Employees Health Benefits Act of 1959 (Public Law 86-382), and other cumulative enrollment. The director’s determination as to whether to exercise discretion under this section and any determination made by the director under this section shall not be subject to judicial review, except that a health plan may bring a writ of mandate under Section 1085 of the Code of Civil Procedure to rectify an abuse of discretion by the department in correcting that health plan’s data when that correction results in a greater tax amount for that health plan pursuant to Section 14199.85.


text:
(a) A managed care organization provider tax shall be imposed on each health plan. The tax shall be imposed for the following tax periods:

(1) April 1, 2023, through December 31, 2023.

(2) 2024 calendar year.

(3) 2025 calendar year.

(4) 2026 calendar year.

(b) (1) The department shall compute the annual tax for each health plan subject to the tax during each applicable calendar year pursuant to Section 14199.85.

(2) The computed tax for the tax period of April 1, 2023, through December 31, 2023, shall be equal to three-fourths of the amount that would otherwise be computed for a 12-month period, as determined by the department.

(c) The department shall collect the tax for each health plan in quarterly installments and shall determine the amount due for each installment in the applicable tax period by dividing the total tax for a tax period by the number of calendar quarters in the respective tax period.

(d) The department shall not collect the tax imposed pursuant to this article until the department receives approval from the federal Centers for Medicare and Medicaid Services that this tax is a permissible health care-related tax in accordance with Section 433.68 of Title 42 of the Code of Federal Regulations and is eligible for federal financial participation.

(1) Within 10 business days following the date the department receives all necessary federal approvals for the tax pursuant to this article, the director shall certify in writing that federal approval has been received, and the department shall post the certification on its internet website and send a copy of the certification to the Secretary of State, the Secretary of the Senate, the Chief Clerk of the Assembly, and the Legislative Counsel.

(2) Within 30 business days following the date the department receives all necessary federal approvals for the tax pursuant to this article, the department shall send a notice to each health plan subject to the tax that shall contain the following information:

(A) The tax due for each tax period.

(B) The dates on which the installment tax payments are due for each tax period.

(3) A health plan shall pay the tax for each tax period in installments as calculated pursuant to Section 14199.85, based on a schedule developed by the department. The department shall establish the date that each tax payment is due, provided that the first tax payment shall be due no earlier than 20 calendar days following the date the department sends the notice pursuant to paragraph (2), and the tax payments shall be paid at least one month apart, but no more than one quarter apart.

(4) A health plan shall pay the taxes that are due, if any, in the amounts and at the times set forth in the notice unless superseded by a subsequent notice issued by the department.

(e) The tax assessed pursuant to this article shall be paid by each health plan subject to the tax to the department for deposit in the Managed Care Enrollment Fund created pursuant to Section 14199.82.

(f) (1) Interest shall be assessed on an applicable health plan for any amount of the managed care organization provider taxes that are not paid on the date due at a rate of 10 percent per annum. Interest shall begin to accrue the day after the date the tax payment was due and shall be deposited in the Managed Care Enrollment Fund created pursuant to Section 14199.82.

(2) If a tax payment is more than 60 days overdue, a penalty equal to the total accrued interest charge described in paragraph (1) shall also be assessed on the applicable health plan and due for each month for which the tax payment is not received after 60 days.

(g) (1) Subject to paragraph (2), the director may waive a portion or all of either the interest or penalties, or both, assessed under this article if the director determines, in their sole discretion, that the health plan has demonstrated that imposition of the full amount of the tax pursuant to the timelines applicable under this article has a high likelihood of creating an undue financial hardship for the health plan or creates a significant financial difficulty in providing needed services to Medi-Cal beneficiaries.

(2) Waiver of some or all of the interest or penalties pursuant to this subdivision shall be conditioned on the health plan’s agreement to make tax payments on an alternative schedule developed by the department that takes into account the financial situation of the health plan and the potential impact on the delivery of services to Medi-Cal beneficiaries.

(h) In the event of a merger, acquisition, establishment, or any other similar transaction that results in the transfer of health plan responsibility for all countable enrollees under this article from a health plan to another health plan or similar entity, and that occurs at any time during which this article is operative, the resultant health plan or similar entity shall be responsible for paying the full tax amount as provided in this article that would have been the responsibility of the health plan to which that full tax amount was assessed upon the effective date of any such transaction. If a merger, acquisition, establishment, or any other similar transaction results in the transfer of health plan responsibility for only some of a health plan’s countable enrollees under this article but not all countable enrollees, the full tax amount as provided in this article shall remain the responsibility of that health plan to which that full tax amount was assessed.


text:
(a) For each tax period, the Medi-Cal taxing tiers shall be as follows:

(1) Medi-Cal taxing tier I shall consist of all countable Medi-Cal enrollees in a health plan from zero to 1,250,000, inclusive.

(2) Medi-Cal taxing tier II shall consist of all countable Medi-Cal enrollees in a health plan from 1,250,001 to 4,000,000, inclusive.

(3) Medi-Cal taxing tier III shall consist of all countable Medi-Cal enrollees in a health plan greater than 4,000,000.

(b) For each tax period, the other taxing tiers shall be as follows:

(1) Other taxing tier I shall consist of all countable other enrollees in a health plan from zero to 1,250,000, inclusive.

(2) Other taxing tier II shall consist of all countable other enrollees in a health plan from 1,250,001 to 4,000,000, inclusive.

(3) Other taxing tier III shall consist of all countable other enrollees in a health plan greater than 4,000,000.

(c) For the period of April 1, 2023, through December 31, 2023, the Medi-Cal per enrollee tax amount for each Medi-Cal taxing tier shall be as follows:

(1) The Medi-Cal per enrollee tax for Medi-Cal taxing tier I shall be zero dollars ($0).

(2) The Medi-Cal per enrollee tax for Medi-Cal taxing tier II shall be one hundred eighty-two dollars and fifty cents ($182.50).

(3) The Medi-Cal per enrollee tax for Medi-Cal taxing tier III shall be zero dollars ($0).

(d) For the period of April 1, 2023, through December 31, 2023, the other per enrollee tax amount for each other taxing tier shall be as follows:

(1) The other per enrollee tax for the other taxing tier I shall be zero dollars ($0).

(2) The other per enrollee tax for the other taxing tier II shall be one dollar and seventy-five cents ($1.75).

(3) The other per enrollee tax for the other taxing tier III shall be zero dollars ($0).

(e) For the 2024 calendar year, the Medi-Cal per enrollee tax amount for each Medi-Cal taxing tier shall be as follows:

(1) The Medi-Cal per enrollee tax for Medi-Cal taxing tier I shall be zero dollars ($0).

(2) The Medi-Cal per enrollee tax for Medi-Cal taxing tier II shall be two hundred seventy-four dollars ($274).

(3) The Medi-Cal per enrollee tax for Medi-Cal taxing tier III shall be zero dollars ($0).

(f) For the 2024 calendar year, the other per enrollee tax amount for each other taxing tier shall be as follows:

(1) The other per enrollee tax for the other taxing tier I shall be zero dollars ($0).

(2) The other per enrollee tax for the other taxing tier II shall be one dollar and seventy-five cents ($1.75).

(3) The other per enrollee tax for the other taxing tier III shall be zero dollars ($0).

(g) For the 2025 calendar year, the Medi-Cal per enrollee tax amount for each Medi-Cal taxing tier shall be as follows:

(1) The Medi-Cal per enrollee tax for Medi-Cal taxing tier I shall be zero dollars ($0).

(2) The Medi-Cal per enrollee tax for Medi-Cal taxing tier II shall be two hundred seventy-four dollars ($274).

(3) The Medi-Cal per enrollee tax for Medi-Cal taxing tier III shall be zero dollars ($0).

(h) For the 2025 calendar year, the other per enrollee tax amount for each other taxing tier shall be as follows:

(1) The other per enrollee tax for the other taxing tier I shall be zero dollars ($0).

(2) The other per enrollee tax for the other taxing tier II shall be two dollars ($2).

(3) The other per enrollee tax for the other taxing tier III shall be zero dollars ($0).

(i) For the 2026 calendar year, the Medi-Cal per enrollee tax amount for each Medi-Cal taxing tier shall be as follows:

(1) The Medi-Cal per enrollee tax for Medi-Cal taxing tier I shall be zero dollars ($0).

(2) The Medi-Cal per enrollee tax for Medi-Cal taxing tier II shall be two hundred seventy-four dollars ($274).

(3) The Medi-Cal per enrollee tax for Medi-Cal taxing tier III shall be zero dollars ($0).

(j) For the 2026 calendar year, the other per enrollee tax amount for each other taxing tier shall be as follows:

(1) The other per enrollee tax for the other taxing tier I shall be zero dollars ($0).

(2) The other per enrollee tax for the other taxing tier II shall be two dollars and twenty-five cents ($2.25).

(3) The other per enrollee tax for the other taxing tier III shall be zero dollars ($0).

(k) (1) The department may modify or make adjustments to any methodology, tax amount, taxing tier, or other provision specified in this article to the extent that it deems necessary to meet the requirements of federal law or regulations, to obtain or maintain federal approval, or to ensure federal financial participation is available or is not otherwise jeopardized, provided the modification or adjustment does not otherwise conflict with the purposes of this article, or result in an increase in the aggregate tax amounts projected to be collected under this article that the department, in its sole discretion, determines is significant.

(2) If the department identifies that modification or adjustment is necessary in accordance with paragraph (1), the department shall consult with affected health plans, to the extent practicable, to implement that modification or adjustment.

(3) In the event of a modification or adjustment made pursuant to this subdivision, the department shall notify affected health plans, the Department of Finance, the Joint Legislative Budget Committee, the Senate Committees on Appropriations, Budget and Fiscal Review, and Health, and the Assembly Committees on Appropriations, Budget, and Health within 10 business days of that modification or adjustment.

(l) The department shall request approval from the federal Centers for Medicare and Medicaid Services as is necessary to implement this article. In making that request, the department may seek, as it deems necessary, a request for waiver of the broad-based requirement, waiver of the uniformity requirement, or both, pursuant to Section 433.68(e)(1) and (2) of Title 42 of the Code of Federal Regulations, or a request for waiver of any other federal law or regulation necessary to implement this article.

(m) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement this article by means of provider bulletins, all-plan letters, or other similar instructions, without taking any further regulatory action. The department shall provide notification to the Department of Finance, the Joint Legislative Budget Committee, the Senate Committees on Appropriations, Budget and Fiscal Review, and Health, and the Assembly Committees on Appropriations, Budget, and Health within 10 business days after the above-described action is taken.

history: (History: Amended by Stats. 2024, Ch. 39, Sec. 1. (AB 160) Effective June 29, 2024. Conditionally operative as prescribed by Section 14199.87. Conditionally inoperative on or before January 1, 2027, as prescribed by Section 14199.87. Repealed as of January 1, 2028, pursuant to Section 14199.87.)


text:
(a) The tax assessed under this article shall become effective and operative on April 1, 2023, or the effective date, certified in writing by the director, of the federal approval necessary for receipt of federal financial participation, whichever occurs later. The director shall post the certification of federal approval on the department’s internet website and send a copy of the certification to the Secretary of State, the Secretary of the Senate, the Chief Clerk of the Assembly, the Legislative Counsel, the State Board of Equalization, the Department of Insurance, and the Executive Officer of the Franchise Tax Board.

(b) This article, except for Section 14199.82 to the extent not in conflict with federal law, shall cease to be operative the first day of the calendar year beginning on or after the date the director, in consultation with the Director of Finance, determines that the taxes have not met the intent as outlined in Section 14199.80, or the department has not obtained the federal approval necessary for receipt of federal financial participation. The director shall post the determination on the department’s internet website and send a copy of the determination to the Secretary of State, the Secretary of the Senate, the Chief Clerk of the Assembly, the Legislative Counsel, the State Board of Equalization, the Department of Insurance, and the Executive Officer of the Franchise Tax Board.

(c) This article, except for Section 14199.82 to the extent not in conflict with federal law, shall cease to be operative for any affected tax period or periods upon a final judicial determination made by any court of appellate jurisdiction or a final determination by the United States Department of Health and Human Services or the federal Centers for Medicare and Medicaid Services that the tax assessed pursuant to this article cannot be implemented for the affected tax period or periods, and any amount of the tax paid under this article with respect to the affected tax period or periods shall be refunded. The director shall post a notification of that final judicial or federal administrative determination on the department’s internet website and provide this notification to the Secretary of State, the Secretary of the Senate, the Chief Clerk of the Assembly, the Legislative Counsel, the State Board of Equalization, the Department of Insurance, and the Executive Officer of the Franchise Tax Board.

(d) Notwithstanding this section, any tax and any applicable interest and penalties imposed under this article shall continue to be due and payable to the department until the tax and any applicable interest and penalties are fully paid.

(e) Upon execution of the declaration described in subdivision (b) or (c), the director shall implement a plan, in consultation with the Department of Finance, to end the program consistent with the purpose of the article, including the recoupment of payments made under this article if required by a final judicial determination made by any court of appellate jurisdiction or a final determination made by the United States Department of Health and Human Services or the federal Centers for Medicare and Medicaid Services.


text:
(a) This article shall become operative on the effective date, certified in writing by the director, of the federal approval necessary for receipt of federal financial participation, as described in subdivision (a) of Section 14199.86 for purposes of assessing the tax under this article.

(b) (1) All sections in this article, except for Section 14199.82 to the extent not in conflict with federal law, shall become inoperative on January 1, 2027, or on a date as specified in subdivision (b) or (c) of Section 14199.86, whichever occurs first. All sections in this article, except for Section 14199.82, are repealed on January 1, 2028.

(2) Notwithstanding paragraph (1), any tax and any applicable interest and penalties imposed under this article shall continue to be due and payable to the department until the tax and any applicable interest and penalties are fully paid.

history: (History: Added by Stats. 2023, Ch. 13, Sec. 2. (AB 119) Effective June 29, 2023. Repealed as of January 1, 2028, by its own provisions. Repeal affects Article 7.1, commencing with 14199.80, except Section 14199.82.)


text:
The Legislature finds and declares all of the following:

(a) The Legislature continues to recognize that an enrollment-based managed care organization (MCO) provider tax is an essential and necessary source of nonfederal funding for maintaining and improving access to care and reimbursement levels under, and maximizing federal financial participation for, the Medi-Cal program.

(b) The Legislature recognizes how the previous iterations of the MCO provider tax, in effect nearly continuously from July 1, 2016, enabled the state to provide ongoing funding for health care and prevention, while minimizing the need for any new reductions to the Medi-Cal program during the time periods when the tax was in effect.

(c) The current MCO provider tax, set forth in Article 7.1 (commencing with Section 14199.80), expires on December 31, 2026.

(d) Article 6 (commencing with Section 14199.123) of Chapter 7.5 requires the department to submit an application for a continued, permanent MCO provider tax, utilizing substantially similar models and methodologies as those for the MCO provider tax authorized in Article 7.1 (commencing with Section 14199.80), to the federal Centers for Medicare and Medicaid Services (CMS), to be effective on January 1, 2027.

(e) The passage of federal H.R. 1 (Public Law 119-21) in 2025, and the publication of the CMS Final Rule on February 2, 2026, titled “Preserving Medicaid Funding for Vulnerable Populations-Closing a Health Care-Related Tax Loophole” (91 FR 4794), materially changed the standards by which CMS may approve applications for a waiver from the broad-based and uniformity requirements for health care-related taxes under Section 433.68(e) of Title 42 of the Code of Federal Regulations.

(f) These new federal requirements may result in a denial of federal approval for the MCO provider tax authorized in Article 6 (commencing with Section 14199.123) of Chapter 7.5.

(g) The CMS Final Rule described in subdivision (e) provided the state with a transition period through December 31, 2026, to bring the state’s MCO provider tax into compliance with the new requirements under Section 433.68(e) of Title 42 of the Code of Federal Regulations.

(h) Implementation of a continued federally approvable MCO provider tax at the earliest possible effective date allowable under federal law, with an application for any necessary federal approvals submitted to CMS before the end of the state’s transition period on December 31, 2026, will best position the state to maintain and improve access to care and reimbursement levels, to maximize federal financial participation, and to minimize the need for any new reductions to the Medi-Cal program.

(i) In furtherance of subdivisions (a) to (h), inclusive, it is the intent of the Legislature that the department implement an MCO provider tax effective on January 1, 2027, that is not subject to Chapter 7.5 (commencing with Section 14199.100), in order to meet all of the following goals:

(1) Generate an amount of funds for the Medi-Cal program that is sufficient to fund the purposes specified in paragraphs (1) to (3), inclusive, of subdivision (d) of Section 14199.92 in full and the purpose specified in paragraph (4) of subdivision (d) of Section 14199.92 in the amount of at least two billion dollars ($2,000,000,000) annually.

(2) Comply with federal Medicaid requirements applicable to permissible health care-related taxes, including, but not limited to, Section 433.68 of Title 42 of the Code of Federal Regulations.

(3) Provide funding to support the Medi-Cal program.

(4) Minimize, to the extent possible, the need for any new reductions to the Medi-Cal program.

history: (History: Added by Stats. 2026, Ch. 24, Sec. 2. (SB 125) Effective June 29, 2026. Operative July 1, 2026, pursuant to Section 14199.97. Conditionally inoperative on or before January 1, 2031, as prescribed by Sections 14199.96 and 14199.97. Repealed as of January 1, 2032, pursuant to Section 14199.97.)

path: 9. PUBLIC SOCIAL SERVICES > 7. Basic Health Care > 7.2. Continuation of Managed Care Organization Provider Tax


text:
For purposes of this article, the following definitions apply:

(a) “Base data source” means the quarterly financial statement filings or annual enrollment data submitted by health plans to the Department of Managed Health Care retrieved by the department no later than June 30, 2026, and supplemented by, as necessary, Medi-Cal enrollment data for the base year as maintained by the department and retrieved no later than June 30, 2026, and as modified by the department to account for known or anticipated changes that will affect Medi-Cal enrollment on or after January 1, 2027. However, if the department elects to update the base year pursuant to subdivision (b), “base data source” means the most recently available quarterly financial statement filings or annual enrollment data submitted by health plans to the Department of Managed Health Care for that updated base year, retrieved by the department, and supplemented by, as necessary, Medi-Cal enrollment data for the updated base year as maintained by the department, and as modified by the department to account for known or anticipated changes that will affect Medi-Cal enrollment.

(b) “Base year” for the 2027 calendar year tax period means either the 12-month period of January 1, 2024, through December 31, 2024, or the 12-month period of January 1, 2025, through December 31, 2025, as determined by the department. For subsequent tax periods, the department may elect to update the base year to the extent that it deems such action to be consistent with the requirements of federal law or regulations, or necessary to obtain or maintain federal approval or to ensure that federal financial participation is available or is not otherwise jeopardized.

(c) “Countable enrollee” means an individual enrolled in a health plan, as described in subdivision (f), during a month of the base year according to the base data source. “Countable enrollee” does not include an individual enrolled in a Medicare plan, a plan-to-plan enrollee, as defined in subdivision (h), or an individual enrolled in a health plan pursuant to the Federal Employees Health Benefits Act of 1959 (Public Law 86-382) to the extent that the imposition of the tax under this article is preempted pursuant to Section 8909(f) of Title 5 of the United States Code.

(d) “Department” means the State Department of Health Care Services.

(e) “Director” means the Director of Health Care Services.

(f) “Enrollee” means an individual enrolled in a health plan, as defined in subdivision (g), unless otherwise specified.

(g) “Health care service plan” or “health plan” means a health care service plan, other than a plan that provides only specialized or discount services, that is licensed by the Department of Managed Health Care under the Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code) or a managed care plan contracted with the State Department of Health Care Services to provide full-scope Medi-Cal services.

(h) “Plan-to-plan enrollee” means an individual who receives their health care services through a health plan pursuant to a subcontract from another health plan.

(i) “Tax amount” means the amount of tax assessed per countable enrollee.

(j) “Tax period” means a period of not more than 12 months for which the tax authorized by this article is assessed, in accordance with the requirements described in Section 14199.94.

article: 7.2. Continuation of Managed Care Organization Provider Tax


text:
(a) The Medi-Cal Stability Fund is hereby created in the State Treasury.

(b) All revenues, less refunds, derived from the taxes provided for in this article shall be deposited in the State Treasury to the credit of the Medi-Cal Stability Fund.

(c) Notwithstanding Section 16305.7 of the Government Code, any interest and dividends earned on moneys in the Medi-Cal Stability Fund shall be retained in the fund and used solely for the purpose specified in subdivision (d).

(d) Notwithstanding Section 13340 of the Government Code or any other law, funds deposited in the Medi-Cal Stability Fund pursuant to this article are continuously appropriated, without regard to fiscal year, to the department for the purpose of funding all of the following subcomponents to support the Medi-Cal program, in the following order of priority:

(1) The department’s administrative costs in an amount not to exceed four million dollars ($4,000,000) annually.

(2) The nonfederal share of increased capitation payments to Medi-Cal managed care plans accounting for their projected tax obligation pursuant to this article for the applicable tax period or periods.

(3) The nonfederal share of the payments described in Section 14105.201.

(4) The nonfederal share of Medi-Cal managed care rates for health care services furnished to children, adults, seniors and persons with disabilities, and persons dually eligible for the Medi-Cal program and the federal Medicare Program, in the amount of at least two billion dollars ($2,000,000,000) annually.

(e) Notwithstanding any other law, the Controller may use the funds in the Medi-Cal Stability Fund for cashflow loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code.

history: (History: Added by Stats. 2026, Ch. 24, Sec. 2. (SB 125) Effective June 29, 2026. Operative July 1, 2026, pursuant to Section 14199.97.)


text:
(a) The department shall determine for each health plan, using the base data source, all of the following:

(1) Total cumulative enrollment for the base year.

(2) Total Medicare cumulative enrollment for the base year.

(3) Total Medi-Cal cumulative enrollment for the base year.

(4) Total plan-to-plan cumulative enrollment for the base year.

(5) Total cumulative enrollment through the Federal Employees Health Benefits Act of 1959 (Public Law 86-382) for the base year.

(6) Total other cumulative enrollment for the base year that is not otherwise counted in paragraphs (2) to (5), inclusive.

(b) Notwithstanding any other provision in this article, the director may correct any identified material or significant error in the data, including, but not limited to, the total cumulative enrollment, Medicare cumulative enrollment, Medi-Cal cumulative enrollment, plan-to-plan cumulative enrollment, cumulative enrollment through the Federal Employees Health Benefits Act of 1959 (Public Law 86-382), and other cumulative enrollment. The director’s determination as to whether to exercise discretion under this section and any determination made by the director under this section shall not be subject to judicial review, except that a health plan may bring a writ of mandate under Section 1085 of the Code of Civil Procedure to rectify an abuse of discretion by the department in correcting that health plan’s data when that correction results in a greater tax amount for that health plan pursuant to Section 14199.95.