The California Department of Health Care Services (DHCS) recently received federal approval on its plan to increase Medi-Cal fee-for-service physician payments for the 2018-2019 fiscal year. The supplemental payments—made possible by the Proposition 56 tobacco tax funding—will raise payments for a total of 23 CPT codes, including 10 new preventive CPT codes.

DHCS will be increasing the supplemental payment for the previously eligible CPT codes to 85 percent of Medicare (a 40 percent average increase in payments for these eligible codes compared with 2017 – 2018 payment levels). The 10 newly added preventive CPT codes will be paid at 100 percent of Medicare.

According to DHCS, the prospective fee-for-service supplemental payments are anticipated to begin as soon as September 24. The timeline for the retroactive payments back to the beginning of the fiscal year (which began July 1, 2018) is still being worked out, but DHCS expects to distribute retroactive payments in early 2019.

There is no additional action required by providers to receive the supplemental payments. Reimbursement on claims for eligible codes (see table below) will automatically include the supplemental payments.

The supplemental payments would apply to both fee-for-service and managed care delivery systems, however approval for DHCS’s managed care proposal is still pending. In the interim, DHCS is continuing to distribute supplemental payments at the 2017-2018 amounts and eligible CPT codes to the Medi-Cal managed care plans with the expectation that those funds be paid to physicians within 90 days of receipt from DHCS. A full list of the eligible CPT codes is listed below.