DHCS announces delay to Medi-Cal Rx implementation

February 22, 2021

The California Department of Health Care Services (DHCS) last week announced it would delay the April 1, 2021, implementation of the Medi-Cal Rx program. According to DHCS, the delay is needed to give the agency time to review new conflict avoidance protocols submitted by Magellan Health, Inc., the project’s contracted vendor.

In January 2021, Centene Corporation announced plans to acquire Magellan. Centene operates – through subsidiaries – managed care plans and pharmacies that participate in Medi-Cal. This transaction was unexpected and requires additional time for exploration of acceptable conflict avoidance protocols to ensure that there will be acceptable firewalls between the corporate entities to protect the pharmacy claims data of all Medi-Cal beneficiaries.

DHCS anticipates it will be in a position to provide an update on the implementation timeline in May.

The California Medical Association (CMA) had been advocating for a delay to the implementation to avoid a disruption in benefits and critical care for beneficiaries at a time when the state continues to wrestle with the enormity of the effects of the ongoing pandemic—which are having an undue burden on our state’s health care system.

While CMA continues to support the Governor’s efforts to lower the cost of drugs for all Californians and will continue to partner with the administration in broader health care cost-containment efforts, CMA has remained engaged in the proposed rollout, and vocal about its concerns for the potential lapse in care and benefits that would occur from implementing the program at this time while physicians are still dealing with the COVID-19 pandemic.

On February 1, 2021, CMA sent a letter to Governor Gavin Newsom expressing concerns regarding the planned implementation of his Executive Order on pharmaceuticals and its direction to carve the pharmacy benefit out of the Medi-Cal managed care benefit, potentially disrupting critical care between patients and physicians as well as benefits for millions of Medi-Cal beneficiaries.

“In a normal year, the implementation of this change would have been a significant workload,” said Dustin Corcoran, CMA CEO. “Given the constraints on our healthcare system due to the COVID-19 pandemic,  we think it is prudent to delay the implementation of this important program.”

To date, only a minutia of the tens of thousands of state prescribing providers have registered for the program, and an even smaller portion of them have received the necessary information to begin to use the proposed portal – the main mechanism that will allow providers to submit authorization requests for their patients.

Citing a lack of enrollment and education on the process for providers, CMA has recommended aligning the Medi-Cal Rx implementation with the implementation of the CalAIM initiative, and postponing implementation until such time as the CalAIM transition occurs and a significant majority of Medi-Cal prescribers have registered and are trained to use the Medi-Cal Rx portal.


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