Latest News | Medi-Cal – Calif

From CHA – 5/14/12

Gov. Brown’s May revision to the state budget for fiscal year (FY) 2012-13 includes $325 million in savings for the state General Fund that will have a direct impact on hospitals. The May revision estimates the budget deficit at $15.7 billion, up from $9.2 billion, due to a decrease in revenue, higher expenses, and decisions by courts and the federal government to block previous budget cuts from being implemented. Overall, the governor’s new budget plan proposes $4.1 billion in spending reductions, in addition to the $4.2 billion already put forward earlier this year. Budget solutions related to Health and Human Services include the following:

Hospital Fee Program – Increase payments made by private hospitals to the state for children’s health care coverage by $150 million in FY 2012-13 and $75 million in FY 2013-14. In addition, designated public hospitals would give up some of the fee-funded direct grants and managed care payments to generate $41.5 million in state General Fund savings for FY 2013-14.

Diagnosis-Related Group (DRG) Transition – Freeze base payments for FY 2012-13 with no increases to per-diem rates or non-contract cost increases. This is expected to save the General Fund $75 million in FY 2013-14. The transition to a DRG payment system would be delayed by six months to July 1, 2013.

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From: California Healthline -  5/10/12

Article Excerpt: 

State officials earlier this year said they wanted to introduce a “new payment methodology” for federally qualified health centers and rural health clinics in California. Their plan included a funding cut of 10%, or about $100 million, to those centers. But Assembly and Senate budget subcommittees rejected the proposal last month, calling the plan unworkable.

Assembly budget subcommittee member Wesley Chesbro (D-Arcata) said cutting so much funding for FQHCs and rural clinics could push those community facilities to cut hours or close down altogether.  “It’s pretty clear that, for decades, in rural care the clinic system is the backbone of health care. And not just for low-income people, I might add. But due to budget cuts and delayed payments, many of them are on the brink of closure,” Chesbro said.

“Their reserves have been depleted, their credit has been exhausted, their creditors are demanding payment. And they’re maxed out,” Chesbro said.

He added, “So the question we need to ask ourselves is, ‘What will we do without them? And who will be there to treat patients when these clinics close their doors?’”

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State Loses Bid to Cut FQHC Rates, Restructure Pay System

From: DHCS Website – 4/4/12

News Release Excerpt:

SACRAMENTO – The California Department of Health Care Services (DHCS) today announced that Los Angeles, Orange, San Diego and San Mateo counties would be the initial participants in a proposed three-year demonstration project aimed at improving the coordination of care for low-income seniors and persons with disabilities who are dually eligible for Medicare and Medi-Cal. These are the first of up to 10 counties that could take part in the project in 2013.

“Currently, most dual eligible beneficiaries access services through a complex system of disconnected programs that often leads to beneficiary confusion, delayed care, poor care coordination, inappropriate utilization and unnecessary costs, issues we are addressing with this proposal,” said DHCS Director Toby Douglas. “The goal is to design a seamless system that helps dual eligible beneficiaries get the health care services they need and improve health outcomes in a more fiscally efficient manner.”

California has approximately 1.1 million people enrolled in both Medicare and Medi-Cal. They are among the state’s highest-need and highest-cost users of health care services, accounting for nearly 25 percent of Medi-Cal spending. The proposed three-year project would enroll a portion of California’s dual eligible beneficiaries into integrated care delivery models. An estimated $678.8 million in General Fund savings is expected in fiscal year (FY) 2012-13, increasing to $1 billion in 2013-14.

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DHCS Initial Selection of Counties for Dual Eligible Beneficiaries Enrollment into Managed Care Plans

Gov. Jerry Brown’s administration wants health care change, with or without federal law

From: The Sacramento Bee – 3/30/12

Aricle Excerpt:

Gov. Jerry Brown’s administration vowed Thursday to continue pushing forward elements of the federal health care overhaul in California, even if the U.S. Supreme Court strikes it down.

If the court does rule the federal law unconstitutional, state Health and Human Services Secretary Diana Dooley said California should at least consider enacting its own universal health care legislation, including requiring every Californian to buy insurance.

“I think that we should be committed to making this system more rational than it is today, and improving the health of the people of California,” Dooley said in an interview. “If we ask the insurance plans to take everybody and insure everybody with no screens or pre-existing conditions, then we have to have everybody buying some level of health insurance to meet their responsibility to the system.”

She said whether the administration sponsors such legislation would depend on “where we are and what the conditions are at that particular time.”

Dooley’s remarks came a day after the Supreme Court finished three days of oral arguments over President Barack Obama’s signature health care law.

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(RHC/FQHC) Update for Per-Visit Code 19 Claims

From: DHCS Website – 3/21/12

Text of Notice:

Rural Health Clinics (RHCs), Federally Qualified Health Centers (FQHCs) and Indian Health Services (IHS) providers (provider types 35 and 75) whose per-visit code 19 outpatient claims (that included aid codes 0C, 8X, 9H and 9T and with dates of service beginning October 1, 2009, through March 15, 2012) were denied with the following Remittance Advice Details (RAD) code:

• 021: This claim was received after the one-year maximum billing limitation

or were subject to payment cutbacks with one of the following RAD codes:

• 0475: Claims submitted during the seventh through ninth month after the month of service without a valid billing limit exception are reduced to 75 percent of the allowed amount
• 0476: Claims submitted during the 10th through 12th month after the month of service without a valid billing limit exception are reduced to 50 percent of the allowed amount.

These claims will no longer suspend for timeliness errors for claims received by June 30, 2012. Providers that have held claims pending system adjustments may now submit their claims without a delay reason code or further documentation.

Providers may contact the Telephone Service Center (TSC) at 1-800-541-5555, option 11, followed by option 17, for any questions

New FI (ACS) Assumes Operations of California Medicaid Management Information System

From: DHCS Website – 3/20/12

Press Release Excerpt:

 SACRAMENTO – The Department of Health Care Services (DHCS) today announced that its new fiscal agent for Medi-Cal claims processing, Affiliated Computer Services (ACS), a Xerox Company, has fully assumed operations and is managing payments to health care providers delivering services to more than 7.6 million Medi-Cal beneficiaries. Since assuming operational responsibility in October 2011, ACS has processed more than 90 million claims totaling $7.5 billion. The transfer of responsibility for this system, called the California Medicaid Management Information System (CA-MMIS), represents one of the largest and most complex system transitions in California history. CA-MMIS processes payments to physicians, pharmacies, hospitals and other providers in the Medi-Cal fee-for-service program.

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FY 2011 – 2012 Medi-Cal Institutional Provider Payment Hold: Update

From: DHCS Website – 3/13/12

Notice Excerpt 

Due to a severe cash flow shortage, the State of California implemented short-term payment delays to Medi-Cal institutional providers effective with the first warrant release date of March 1, 2012. Payments withheld for these Medi-Cal institutional providers will be released on March 15, 2012 (Electronic Funds Transfer [EFT] date of March 19, 2012) along with all services normally scheduled for payment that week.

Please note that payments scheduled for a warrant release date of March 8, 2012 (EFT date of March 12, 2012), will continue to be held until the warrant release date of March 22, 2012 (EFT date of March 26, 2012) and will be paid along with all services normally scheduled for payment that week.

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New POS User Guide and POS Forms Update

Excerpt:

A new Point of Service (POS) User Guide for the VX 520 device and updated POS-related forms are now available.

Providers with the Omni 3300 device should continue to refer to the VeriFone Omni 3300 user guide, and providers with the VX 520 device should refer to the VeriFone VX 520 user guide. Both of these guides can be found on the Point of Service (POS) Device User Guides page.

From: DHCS Website – 2/23/12

Memo Excerpt:

 Assembly Bill 102, signed by Governor Brown on June 28, 2011, directs the Department of Health Care Services (DHCS) and the Department of Mental Health (DMH) to create a transition plan to guide the transfer of Medi-Cal related specialty mental health services to DHCS, effective July 1, 2012. The bill also requires the departments to convene a series of meetings and forums with stakeholders (clients, providers, counties, and representatives of the Legislature) to inform the creation of the transition plan. DHCS and DMH held stakeholder meetings in July and August of 2011. These meetings informed the development of the draft transition plan and to receive input on the draft plan prior to submission to the Legislature on October 1, 2011.

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U.S. Supreme Court Issues Douglas v. Independent  Living Centers Decision

From: HLB Health Law E-alert – 2/22/12

Article Excerpt:

The U.S. Supreme Court today issued its decision in Douglas v. Independent Living Centers. The issue in this case is whether providers may sue state officials to challenge Medicaid rate cuts because the cuts result in rates that are so inadequate that they violate the requirement of federal law that rates be consistent with quality of care and sufficient to ensure that beneficiaries have equal access to services (the “equal access provision”). The Court, in a 5 to 4 decision, indicates that beneficiaries and providers likely may challenge these types of rate cuts in federal court.

Hooper, Lundy, and Bookman represents the California Hospital Association, the California Medical Association and other provider associations in Independent Living Centers and the plaintiffs in one of the consolidated cases, Douglas v. California Pharmacists Association. We are also handling many other Medicaid rate cases filed both before and after the Supreme Court heard arguments in Independent Living Centers.

The Court remanded the cases to the Ninth Circuit. The Court concluded that the circumstances had changed since the cases were presented to the Court because the federal Centers for Medicare and Medicaid Services (“CMS”) approved certain state rate cuts in October 2011 well after the Ninth Circuit’s decisions before the Court, and after the cases had been briefed and argued.

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