Under fee-for-service Medi-Cal, beneficiaries are responsible for finding primary care providers and specialists who are willing to accept Medi-Cal; beneficiaries are not matched with a primary care provider who coordinates their care. The California Department of Health Care Services (DHCS) establishes fee schedules, negotiates rates with hospitals, determines medical necessity criteria and pays provider claims for services provided.
Medi-Cal Managed Care
In response to rising fee-for-service costs and concerns about access to care, California began to enroll a significant portion of the Medi-Cal population into managed care in the 1990s, although CenCal Health (formerly known as the Santa Barbara Regional Health Authority) pioneered the shift to managed care when it opened its doors in 1983, and Contra Costa Health Plan participated in the earliest version of Medi-Cal managed care dating back to the 1970s. While the managed care models differ by county, each of the participating health plans contract with DHCS and assume full financial risk for all covered services.
Launched in the mid-1990s, the Two-Plan model operates in 14 of the state’s larger, more urban counties. Under this model, Medi-Cal beneficiaries have a choice between a local health plan (known as the Local Initiative) and a Commercial Plan (e.g., Anthem Blue Cross, Health Net, Molina Healthcare) competitively selected by DHCS. Each Local Initiative has been created by its respective county board of supervisors and is overseen by a local commission (the one exception is Tulare County in which two Commercial Plans offer coverage). Both the Local Initiatives and Commercial Plans contract with DHCS.
LHPC represents all nine of the public Local Initiatives offering coverage in 13 counties: Alameda Alliance for Health, CalViva Health, Contra Costa Health Plan, Health Plan of San Joaquin, Inland Empire Health Plan, Kern Health Systems, L.A. Care Health Plan, San Francisco Health Plan, and Santa Clara Family Health Plan.
The six COHS plans operate in 22 counties. The COHS counties represent a mix of large, urban counties (e.g., Orange County) and smaller, more rural counties (e.g., San Luis Obispo County). This model has the distinction of being defined in both state statute and federal statute (as a Health Insuring Organization, or HIO). COHS are public entities created by county boards of supervisors and governed by independent commissions. Under this model, the state contracts the COHS, and the vast majority of the Medi-Cal beneficiaries in the county are automatically assigned to the health plan.
LHPC represents all six of the COHS plans: CalOptima, CenCal Health, Central California Alliance for Health, Gold Coast Health Plan, Health Plan of San Mateo, and Partnership HealthPlan of California.
The GMC model operates in two counties: Sacramento and San Diego. In these counties, Medi-Cal beneficiaries can choose among multiple health plans. Under this model, the state contracts with a number of commercial plans and, in San Diego County, a non-profit, community-based plan.
LHPC represents Community Health Group, which is the community-based plan in San Diego County.
The Regional model is the newest Medi-Cal managed care model and is now operational in the last 20 predominantly rural counties in California. For the most part, Medi-Cal beneficiaries residing in these counties are required to enroll in a managed care plan. In most of the Regional model counties, Medi-Cal beneficiaries have a choice of two commercial plans that contract with DHCS. The lone exception is San Benito County in which beneficiaries may choose between enrolling in the commercial health plan or remaining in fee-for-service Medi-Cal.