The California Department of Health Care Services (DHCS) recently announced the results of its first ever competitive Medi-Cal managed care procurement, which according to DHCS will redefine how care is delivered and which commercial payors will participate in California’s Medi-Cal managed care program beginning in 2024.

Through the competitive bidding process, DHCS announced its intent to award contracts to Molina Healthcare, Anthem Blue Cross Partnership Plan, and Health Net to deliver Medi-Cal managed care services in California beginning in 2024. DHCS estimates that roughly 2.3 million managed care members, will transition to a new plan as a result of the commercial procurement, with the majority of those in Los Angeles, Kern, Sacramento and San Diego counties.

All Medi-Cal managed care plans (MCP) statewide—including public plans and Kaiser Permanente—will also have to meet the new and enhanced MCP contract requirements when the new contract goes into effect on January 1, 2024.

As a result of the restructured managed care contract, plans must commit to a range of new requirements that advance health equity and improve population health. Priorities include:

• The delivery of culturally competent care and access to providers, and coordination of care across settings and at all levels.
• All MCPs will be expected to engage and coordinate with local community partners, invest resources into the community, and make public their performance and health equity activities.
• High-quality, accessible, and comprehensive care across all settings and levels of care.
• Reducing health disparities and improving health outcomes.
• Transparency by making available information and insights to support plan choice.

This procurement only applied to commercial MCPs in 21 counties. The Local Initiative Health Plans and the County Organized Health Systems were not part of the procurement and did not have to bid during the process. DHCS is also allowing 17 counties to change the type of managed care model offered, and approved a proposed direct contract with Kaiser Permanente in 32 counties, subject to federal approval.

In counties where there are model and/or plan changes, physicians will need to consider contracting with a new plan if they wish to continue to see Medi-Cal patients beginning in 2024.

Medi-Cal patients also have continuity of care rights that will be fully protected and enforced during the transition. For example, if a patient is currently under the care of a physician during the prior 12 months for treatment of a medical condition, the patient has the right to continue seeing that doctor for up to 12 months if certain conditions are met.

DHCS intends to award 28 contracts to the following commercial MCPs to deliver Medi-Cal services in 21 counties:

*Bolded text indicates incumbent

Plans who were not selected were allowed to appeal the decision. (The list of appeals file can be found here.)

The California Medical Association will be closely monitoring the transition and will keep physicians informed as new information becomes available.

For more information:

• DHCS Press Release
• DHCS Medi-Cal Procurement FAQ
• DHCS Medi-Cal Managed Care Plan RFP