State budget includes $250M for Medi-Cal Value-Based Payments Program

July 11, 2019
Area(s) of Interest: Access to Care Payor Issues and Reimbursement 

On June 27, 2019, Governor Newsom signed his first state budget, which included significant new funding for health care programs.

  • $250 million in funding for the Medi-Cal Value-Based Payments Program, with $70 million of this funding specifically earmarked for behavioral health integration
  • $150 million to fund supplemental payments for developmental and trauma screening
  • $50 million over three years to train providers to conduct these screenings

The value-based payments will apply to services provided starting July 1, 2019. The behavioral health integration, as well as the trauma and developmental screenings, have an implementation date of January 1, 2020.

The Value-Based Payments Program will provide incentive payments to managed care providers for meeting specific measures aimed at improving care for high-cost and/or high-need populations. These risk-based incentive payments will focus on physicians who meet specific achievement on metrics targeting four areas: behavioral health integration, chronic disease management, prenatal and postpartum care, and early childhood prevention. To address and consider health disparities, DHCS will pay an increased incentive amount for events tied to beneficiaries diagnosed as having a substance use disorder or serious mental illness, or who are homeless. There are specific billing codes associated with each of the measures.

DHCS conducted a webinar in June with details on the implementation of value based payments, and the slides are available on the DHCS website. DHCS is in the process of finalizing the details of the program, including the incentive amounts and timing of the payments.

DHCS also must obtain federal approval of the Value Based Payment proposal, which may take several months. Physicians will receive retroactive payments from the managed care plans once federal approval is received, and then will receive the incentive payments going forward.


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