On January 1, 2024, the largest Medi-Cal provider rate increases in state history will begin, which will increase access to health care for the millions of Californians with Medi-Cal coverage. These rate increases are made possible by the passage of a Managed Care Organization (MCO) Tax to draw down federal matching dollars, as part of the 2023-24 budget deal negotiated by the Coalition to Protect Access to Care, led by the California Medical Association (CMA). 

The rate increases that begin in 2024 will be followed by additional increases that go into effect on January 1, 2025. The goal is to improve access and equity for Medi-Cal enrollees and make it possible for physicians and other providers to see more Medi-Cal patients.

“The investments in Medi-Cal that are set to take effect in 2024 are the tangible results of our advocacy and will provide meaningful access to care for the most vulnerable Californians,” said CMA President Tanya W. Spirtos, M.D.

In this initial phase of implementation, the rate increases are focused in the areas of primary care, obstetric and non-specialty mental health services. The California Department of Health Care Services (DHCS) recently published the new Medi-Cal Targeted Rate Increase (TRI) Fee Schedule, effective January 1, 2024. The fee schedule is now posted on the DHCS TRI website. The fee schedule includes a revised code list from the list DHCS published last July.

For each included code, the fee schedule displays a targeted rate that is at least 87.5% of the lowest Medicare rate effective in California. For those codes on the TRI fee schedule that currently receive Proposition 56 supplemental payments, those supplemental payments will be built into the base rates on the fee schedule, eliminating the need to submit requests for supplemental payments. Rates for some of those codes are higher than 87.5% of Medicare. For specified codes that do not have Medicare rates, DHCS crosswalked rates to equivalent codes with Medicare rates.

DHCS Webinar

DHCS will be hosting a 90-minute webinar on December 19, 2023, at 3 p.m. to discuss the targeted rate increases and allow providers to get their questions answered. Please send questions you would like addressed during the webinar to TargetedRateIncreases@dhcs.ca.gov by December 15. DHCS will also be publishing an FAQ on the targeted rate increases. 

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