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San Francisco Marin Medical Society Blog

Some California Providers Might Receive Waiver for 10% Medi-Cal Cut

Some Medi-Cal providers in California could receive waivers to avoid a 10% cut to reimbursement rates.

In October 2011, CMS approved the state's plan to reduce certain Medi-Cal payments by 10%. The cut is retroactive to June 1, 2011.

In December 2012, a three-judge panel of the 9th U.S. Circuit Court of Appeals overturned a district court ruling to stop the retroactive 10% cut. Health care providers asked the full 9th Circuit court to review the case. In May, the full circuit court upheld the cut.

In September, the California Medical Association petitioned the U.S. Supreme Court to review the federal court ruling.

Details of Reduction

The cut will start at $917 million for fiscal year 2013-2014 and one year later will increase to $1.4 billion.

H.D. Palmer, a spokesperson for the California Department of Finance, noted that payment reductions are up to 10%, rather than a flat 10% cut.

The reduced payments will go into effect:

  • October 24 (this Thursday) for medical-supply companies
  • January 9, 2014 for physicians, clinics and pharmacies

Source: California Healthline, October 23, 2013.

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