Last week, the California Medical Association (CMA) submitted comments to the California Department of Health Care Services (DHCS) on the state’s next 1115 Section Medicaid Waiver, telling DHCS that increasing reimbursement rates is absolutely imperative prior to implementation of any new program reforms. California's current Medi-Cal rates often do not even come close to the cost of providing care.

California is in the last year of its current Section 1115 waiver, which was approved by the federal government so California could expand Medi-Cal coverage in accordance with the Affordable Care Act in 2010 and implement a variety of delivery reform projects like the duals demonstration project.

The state’s current five-year waiver is set to expire October 2015. CMA has participated in a number of workgroups designed by DHCS to receive feedback on what new projects the state would implement in the next waiver. The state convened workgroups in order to explore ways to implement incentive payments to providers participating in the Medi-Cal program and how to increase and maintain the physician workforce in the state of California.

CMA commented that the 10 percent provider reimbursement cut authorized by AB 97, on top of California’s already abysmally low provider reimbursement rates, which have not been adjusted for increasing costs in two decades, and the discontinuation of the Affordable Care Act’s pay bump for primary care providers, makes it very difficult for physicians to accept new Medi-Cal patients—placing roadblocks for patient access to care.

CMA made it clear that increasing rates is a prerequisite to implementing incentive payment reforms. CMA called for the state to conduct an independent, third-party assessment on reimbursement rates, stating that such an assessment is a critical component in determining both the baseline rates and the level of incentive payments required.

CMA also commented on workforce development, calling for the funding of new residency programs and the expansion of Song-Brown and Steven M. Thompson Physician Corps Loan Repayment Programs.

DHCS is expected to enter into negotiations with the Center for Medicare and Medicaid Services on the new waiver in the spring of 2015.

Contact: Lishaun Francis, (916) 551-2554 or lfrancis@cmadocs.org.