San Francisco Marin Medical Society Blog

DHCS to Implement 10% Medi-Cal Cuts in October

The Department of Health Care Services (DHCS) recently announced that it would begin to implement the 10% Medi-Cal physician payment rate reduction on October 1, 2013, for Medi-Cal managed care and on January 9, 2014, for fee for service (FFS). DHCS also announced that it would be retroactively implementing the cuts for FFS providers to June 1, 2011, when the law authorizing the cuts went into effect. 

DHCS said it will recoup a percentage of provider payments to recover overpaid funds during the retroactive period. These retroactive payment recoveries will not occur until after the prospective 10% payment reductions are implemented. In total, DHCS will retroactively recoup overpayments made over a period of 29 months.

Specialty physician services in Medi-Cal managed care will not be subject to a reduction. The SFMS/CMA is working with the state to obtain additional information.

These cuts could not come at a worse time, as California is poised to expand Medi-Cal to 1.4 million more Californians under federal health reform, and as the demand for physicians is expected to rise.

SFMS/CMA is part of an unprecedented coalition of physicians, dentists, health care workers and hospitals that will continue working to stop the cuts. The coalition, called "We Care for California," includes the largest statewide organizations representing physicians, dentists, hospitals and health care workers, as well as health plans, first responders, caregivers and other health providers.

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