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CMA comments on Governor’s proposed Medi-Cal reforms

January 10, 2020
Area(s) of Interest: Advocacy Public Payors 


On October 29, 2019, the California Department of Health Care Services (DHCS) and the Governor’s office released a proposal for broad delivery system and payment reforms across the Medi-Cal program.

This expansion proposal, formerly known as CalAIM and now called Medi-Cal Healthier California for All, would address many challenges of chronically unsheltered populations – providing funding for tenancy support services, housing navigation services, recuperative care, and could include targeted rental assistance if housing insecurity is tied to inappropriately high utilization of costly health care services. This reform will also change how counties operate behavioral health services, making them more closely integrated and act more like physical health services. To implement this program, the governor’s proposed budget would allocate $695 million effective January 1, 2021, growing to $1.4 billion in 2021-22 and 2022-23.

The proposed reforms build upon the successful outcomes of various pilots and will result in better quality of life for Medi-Cal members and long-term health care cost savings.

The proposed expansion has three primary goals:

  1. Identify and manage member risk and need through whole person care approaches and addressing social determinants of health;
  2. Reduce complexity and increase flexibility in the Medi-Cal system; and
  3. Improve quality outcomes and drive delivery system transformation through value-based initiatives, modernization of systems and payment reform.

The California Medical Association (CMA) is an active participant in the stakeholder engagement process and is a member of the Population Health Workgroup. As a part of this process, CMA submitted a letter to DHCS on December 16, 2019, giving our initial feedback. Overall, CMA is supportive of the proposal, but offered suggestions to DHCS on several topics of reform including, but not limited to data, referral networks and rates and benefits.

CMA believes that clear and meaningful data is paramount to provide effective and efficient care for patients. CMA urged DHCS to conduct more in-depth screenings, and assessment of recipients’ social needs, including their access to food, clothing, household goods, and transportation, and to share that information with physicians so that they can provide better, more wholistic care. A mechanism should be developed to appropriately and legally share the patient information collected during the risk assessment with the physicians who are directly caring for patients. CMA also urged that collected in the initial risk assessment be standardized so DHCS is able to compare data across plans and develop methods to evaluate the success of their population health management programs.

CMA also urged DHCS to require that plans provide physicians with an easy to access and efficient resource referral network. CMA supports the development of a 24/7 nurse advice hotline and other care and referral networks that allow for seamless transition between physicians and social service providers. In addition to these networks, CMA believes that health information technology (HIT) is a crucial part of these reforms and suggests that DHCS develop and incentivize the shift to HIT.

The proposal also includes a new enhanced care management (ECM) benefit. CMA strongly supports efforts to promote well-coordinated and adequately funded case managers for people with complex medical and social needs. However, in order to successfully implement this new benefit, plans cannot simply add additional unfunded requirements to provider contracts and expect this to be absorbed into practice flows. CMA is urging that plans be required to include reimbursement for enhanced care management responsibilities in physician contracts.

While CMA is generally supportive of the proposal, we cautioned DHCS about creating a mandatory Medi-Cal managed care enrollment for vulnerable patients. CMA is also concerned about the potential downward pressure on capitated rates that some plans may experience because of a shift to regional rates, which may result in downward pressure in physician contracted rates.

CMA looks forward to remaining a leading participant in the stakeholder engagement process and will continue to ensure that physician voices are heard as this program develops. 

For more information, see CMA’s comments.

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