LOS ANGELES – L.A. Care Health Plan, the nation’s largest public health plan, announced today that it will not pass along the state’s mandated Medi-Cal rate cut to its directly-contracted Medi-Cal provider network. The decision to absorb the cuts came after L.A. Care was notified by the Department of Health Care Services (DHCS) that its Medi-Cal reimbursement rate would decrease approximately three percent, retroactive to July 1, 2011.
“L.A. Care recognizes the challenge that doctors and providers experience in serving the Medi-Cal population under existing rates,” says Howard Kahn, CEO of L.A. Care Health Plan. “We feel strongly that we must maintain the integrity of the safety net to ensure access to quality care for L.A. County’s vulnerable populations. Helping doctors and providers in this way ensures there will be no interruption of service for our Medi-Cal beneficiaries.”
The rate cut stems from Assembly Bill 97 which includes a 10 percent Medi-Cal rate cut to many providers including physicians and dentists. The actuarial equivalent of the cut to Medi-Cal managed care plans such as L.A. Care is approximately three percent.
Funds to support L.A. Care’s decision to absorb the rate reduction will come from L.A. Care reserves and cost containment efforts. L.A. Care’s directly-contracted Medi-Cal provider network serves nearly 190,000 low-income residents of Los Angeles County including children, seniors and people with disabilities.