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California §1115 Waiver Renewal Highlights

In an email to stakeholders, the California Department of Healthcare Services announced that a conceptual agreement around the major components of the §1115 Medicaid waiver renewal has been reached with the Centers for Medicare and Medicaid Services, and that the State’s existing waiver would be extended until December 31st while DHCS and CMS finalize the waiver’s details.

A brief overview of the core elements of the conceptual agreement follows:

  • Total federal funding is $6.218 billion over 5 years or $1.4 annually.
  • Global Payment Program includes five years of DSH funding and one year of Safety Net Care Pool funding at $236 million. Future SNCP funding will depend on an independent study of public systems’ uncompensated care. The Global Payment funds will be allocated based on “value” – in other words an emergency room visit to amputate an infected limb that was untreated would be a lower value than treating the infection in the first place and preventing the amputation. In the past DSH and SNCP funds were distributed based on the hospitals’ volume of uncompensated care.
  • DSRIP (Delivery System Reform Incentive Pool) is renamed as PRIME (Public Hospitals Redesign and Incentives in Medi-Cal). $3.266 billion over 5 years is allocated to Public Hospitals. $467 million over 5 years is allocated to district hospitals. PRIME is to strengthen public systems’ ambulatory care capacity.
  • Dental transformation incentive program is funded at $750 million over 5 years.
  • Whole Person Care Pilots are funded at $1.5 billion over 5 years. These are voluntary county-based pilots to provide better-integrated care for the highest cost, highest risk most vulnerable populations.

What’s missing from the initial state concepts?

  • Managed care transformation
  • Partnerships and integration between local managed care plans and local mental health plans
  • Improvements in maternity care
  • Workforce development
  • Supportive housing for the homeless who are high cost users of Medi-Cal services.

For a review of the original §1115 waiver renewal concepts, please see ITUP’s Summary of DHCS Waiver Renewal Concepts. For the CMS letter with details, please see DHCS, CMS Agree to 1115 Waiver Renewal Concept, Extend Current Waiver Through Dec. 31.

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