CA SB 1423

Title: Medi-Cal: critical access hospitals.
Author: Brian Dwain Dahle

Summary
SB 1423, as amended, Dahle. Medi-Cal: critical access hospitals. Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Under existing law, each hospital designated by the department as a critical access hospital, and certified as such by the Secretary of the United States Department of Health and Human Services under the federal Medicare rural hospital flexibility program, is eligible for supplemental payments for Medi-Cal covered outpatient services rendered to Medi-Cal eligible persons. Existing law conditions those payments on receipt of federal financial participation and an appropriation in the annual Budget Act for the nonfederal share of those payments, with supplemental payments being apportioned among critical access hospitals based on their number of Medi-Cal outpatient visits.This bill would require that each critical access hospital that elects to participate be reimbursed at 100% of the hospital’s projected reasonable and allowable costs for covered Medi-Cal services, as defined, furnished in the Medi-Cal fee-for-service and managed care delivery systems for each subject calendar year, effective for dates of service on or after January 1, 2026. The bill would require the department to develop and maintain one or more reimbursement methodologies, or revise one or more existing reimbursement methodologies applicable to participating critical access hospitals, or both, to implement the minimum cost-based payment levels.The bill would set forth a timeline and a procedure for the department to notify each critical access hospital of the ability to elect to participate in those methodologies, and for a critical access hospital to inform the department of its election to participate, its discontinuance, or its later participation. Under the bill, these provisions would not be construed to preclude a participating critical access hospital from receiving any other Medi-Cal payment for which it is eligible, including, but not limited to, supplemental payments, with specified exceptions.The bill would require the department to determine the projected reasonable and allowable Medi-Cal costs prior to each applicable calendar year, as specified. The bill would require the department to require each applicable Medi-Cal managed care plan to reimburse a participating hospital for covered services, and would require the department to develop and pay actuarially sound capitation rates to each applicable managed care plan, as specified.The bill would require the department to promptly seek any federal approvals that it deems necessary to implement these provisions, as specified. The bill would condition implementation of these provisions on receipt of any necessary federal approvals and the availability of federal financial participation. The bill would authorize the department to modify the requirements described in these provisions under certain conditions for federal purposes.

Status
From committee: Do pass as amended and re-refer to Com. on APPR. (Ayes 11. Noes 0.) (April 24).

Bill Documents
CA SB 1423 - 04/08/24 - Amended Senate
04/08/24 - CA SB 1423 (04/08/24 - Amended Senate)