2011 California Code
Welfare and Institutions Code
DIVISION 9. PUBLIC SOCIAL SERVICES [10000 - 18996]
ARTICLE 5.226. Medi-Cal Hospital Rate Stabilization Act of 2011
Section 14168.5

(a) The department shall increase capitation payments to Medi-Cal managed health care plans for the program period as set forth in this section.

(b) The increased capitation payments shall be made as part of the monthly capitated payments made by the department to managed health care plans.

(c) The aggregate amount of increased capitation payments to all Medi-Cal managed health care plans for the program period shall be three hundred twenty-three million six hundred forty-nine thousand eight hundred fifty seven dollars ($323,649,857), or the maximum amount for which federal financial participation is available, whichever is lower.

(d) The department shall determine the amount of the increased capitation payments for each managed health care plan. The department shall consider the composition of Medi-Cal enrollees in the plan, the anticipated utilization of hospital services by the plan s Medi-Cal enrollees, and other factors that the department determines are reasonable and appropriate to ensuring access to high-quality hospital services by the plan s enrollees.

(e) The amount of increased capitation payments to each Medi-Cal managed care health plan shall not exceed an amount that results in capitation payments that are certified by the state s actuary as meeting federal requirements, taking into account the requirement that all of the increased capitation payments under this section shall be paid by the Medi-Cal managed health care plans to hospitals for hospital services to Medi-Cal enrollees of the plan.

(f) (1) The increased capitation payments to managed health care plans under this section shall be made to support the availability of hospital services and ensure access to hospital services for Medi-Cal beneficiaries. The increased capitation payments to managed health care plans shall commence no later than June 30, 2011, or within 60 days of the date on which all necessary federal approvals have been received, and shall include, but not be limited to, the sum of the increased payments for all prior months for which payments are due.

(2) To secure the necessary funding for the payment or payments made pursuant to paragraph (1), the department may accumulate funds in the Hospital Quality Assurance Revenue Fund for the purpose of funding managed care capitation payments under this article regardless of the date on which capitation payments are scheduled to be paid in order to secure the necessary total funding for managed care payments by June 30, 2011. To the extent feasible, the funds shall be accumulated as follows, provided that the department may adjust the following dates and amounts as necessary to accumulate sufficient funding by June 1, 2011:

(A) Fifty percent of total necessary funding shall be accumulated from the first payment of quality assurance fees received from the hospitals and made pursuant to Article 5.227 (commencing with Section 14168.31).

(B) Fifty percent of total funding necessary shall be retained from the final payment of quality assurance fees received from the hospitals and made pursuant to Article 5.227 (commencing with Section 14168.31).

(g) Payments to managed health care plans that would be paid consistent with actuarial certification and enrollment in the absence of the payments made pursuant to this section shall not be reduced as a consequence of payment under this section.

(h) (1) Each managed health care plan shall expend 100 percent of any increased capitation payments it receives under this section on hospital services.

(2) The department may issue change orders to amend contracts with managed health care plans as needed to adjust monthly capitation payments in order to implement this section.

(3) For entities contracting with the department pursuant to Article 2.91 (commencing with Section 14089), any incremental increase in capitation rates pursuant to this section shall not be subject to negotiation and approval by the California Medical Assistance Commission.

(i) In the event federal financial participation is not available for all of the increased capitation payments determined for a month pursuant to this section for any reason, the increased capitation payments mandated by this section for that month shall be reduced proportionately to the amount for which federal financial participation is available.

(j) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department shall implement this section by means of policy letters or similar instructions, without taking further regulatory action.

(Added by Stats. 2011, Ch. 19, Sec. 7. Effective April 13, 2011. Conditionally inoperative as provided in Sections 14168.13 and 14168.40. Repealed conditionally on June 1, 2011, as prescribed by Section 14168.17. Repealed as of January 1, 2013, pursuant to Section 14168.16, if not repealed earlier.)