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Governor’s Special Session Managed Care Tax

The California legislature is working with the Department of Health Care Services (DHCS) to find a solution for a $1.1 billion dollar gap in funding needed for various expenditures under the Medi-Cal program (California’s Medicaid program), most pertinently In-Home Supportive Services (IHSS) hours restoration, and Medi-Cal provider and developmental disability service rate increases. The taxes collected from managed care organizations (MCO) are used as the State’s portion of funds, that the federal government then matches, bringing in additional federal money to fund Medi-Cal. A solution to restructuring the MCO tax, a robust revenue stream for the Medi-Cal program, is a top priority for Governor Brown as he called for a special legislative session to address this issue. Failure to make up this $1.1 billion dollars would result in program cuts equal to this amount.

Access the entire policy brief here: Special Session


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