January 1, 2024, marked a monumental step towards improving access to health care for millions of Californians with Medi-Cal coverage, as the largest Medi-Cal provider rate increases in state history went into effect.

"I'm proud of our efforts to secure meaningful investments in Medi-Cal that will go a long way in improving access to health care. And I thank the California Department of Health Care Services for their work enacting these transformative changes that will ensure Medi-Cal meets California’s health care needs,” stated Tanya W. Spirtos, M.D. president of the California Medical Association (CMA).

In this initial phase of implementation, the rate increases are concentrated in primary care, obstetric, and non-specialty mental health services. Additional increases will 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 rate increases taking effect are the tangible results of dedicated efforts and advocacy by the Coalition to Protect Access to Care, led by CMA to pass the Managed Care Organization (MCO) Tax as part of the 2023-24 budget deal, allowing the state to draw down federal matching dollars. 

The new Medi-Cal Targeted Rate Increase (TRI) Fee Schedule is available on the DHCS TRI website. This fee schedule includes a revised code list, ensuring that for each code, the targeted rate is at least 87.5% of the lowest Medicare rate effective in California.

Additionally, to aid providers in understanding these changes, DHCS hosted a 90-minute webinar on December 19, 2023. The presentation materials from that webinar are available on the DHCS website.

The rate increases for more than 760 codes went into effect on January 1, 2024, however because implementing these rate increases will necessitate system and contract updates, health plans have been given some time to make these adjustments. Plans will be required to make retroactive payments to providers for any payments for dates of service on or after January 1, 2024, that  did not include the rate increases. 

“CMA takes pride in our work to strengthen the health care delivery system and investing in the well-being of our communities,” added Dr. Spirtos.  “This historic investment in Medi-Cal is a crucial step towards achieving justice and equity for the 14 million Californians who rely on Medi-Cal for their health care.”

To ensure the gains made through the 2023-24 state budget are protected for the future, CMA and the Coalition to Protect Access to Care have launched the Protect Access to Healthcare Act and are working to place it on the November 2024 ballot. You can learn more about that effort, here.