California Providers Fight Medi-Cal Cuts

While Golden State providers repelled larger Medicaid cuts last year, CAMPS and AAHomecare are now working California HME stakeholders to limit significant retroactive recoupments.

The American Association for Homecare and the California Association of Medical Product Suppliers (CAMPS) are working to stem retroactive cuts that could be implemented by the state Medicaid program, Medi-Cal. Worse, those cuts are being exacerbated by a longstanding cut and the COVID-19 public health emergency.

Last year, HME providers in the Golden State convinced Medi-Cal to shelve a proposal to base reimbursement rates on 80 percent of non-rural Medicare rates, and instead use higher rural rates. Those new rates went into effect in April.

However, the California State Plan Amendment (SPA) state plan was amended in such a way that will retroactively charge providers for more than one year (15 months), going back to January 2019.

Additionally, California has been applying an additional 10 percent cut from all Medi-Cal reimbursements since 2011. The new reduced reimbursement rates will suffer that additional cut, as well. 

Add to that the decreased availability and increased prices on a number of pieces of equipment due to COVID-19 and the rate cuts being to stack up. California provider Devin DeLozier with SuperCare Health outlined his concerns in this video:

letter from AAHomecare Vice President of Payer Relations Laura Williard to the CMS Regional Administrator outlines all of these concerns and provides a table of the increased supply costs and decreased availability.

“With these product and operational cost increases the DME industry cannot sustain any reductions in reimbursement, and the addition of 15 months of recoupments will drastically impact the viability of this industry in California,” Williard writes. “…AAHomecare urges CMS to adjust the approval of the California SPA 19-0005 to the appropriate date of 10/1/2019 to meet regulation requirements of becoming effective no sooner than the beginning of the quarter the SPA was submitted.”

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