Article 4 - The Medi-Cal Benefits Program

California Welfare and Institutions Code — §§ 14131-14138

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Sections (148)

Amended by Stats. 1975, Ch. 1005.

The Medi-Cal Benefits Program comprises a department-administered uniform schedule of health care benefits. Notwithstanding any other provision of this chapter, “health care services” shall be limited to the benefits set forth in this article and in Section 14021.

Amended by Stats. 2024, Ch. 40, Sec. 64. (SB 159) Effective June 29, 2024.

(a)Notwithstanding any other provision of this chapter or Chapter 8 (commencing with Section 14200), optional hearing aid benefits are subject to per beneficiary benefit cap amounts under the Medi-Cal program.
(b)For the purposes of this section, “benefit cap amount” means the maximum amount of Medi-Cal coverage for optional hearing aid benefits as specified in subdivision (c), for each beneficiary, for each fiscal year.
(c)(1) If the voters approve the addition of Chapter 7.5 (commencing with Section 14199.100) to this part at the November 5, 2024, statewide general election, hearing aid benefits are subject to a benefit cap amount of one thousand five hundred ten dollars

($1,510).

(2)Notwithstanding paragraph (1), if the voters do not approve the addition of Chapter 7.5 (commencing with Section 14199.100) to this part at the November 5, 2024, statewide general election, hearing aid benefits are subject to a benefit cap amount of no less than one thousand five hundred ten dollars ($1,510). Under that circumstance, the benefit cap amount shall be set by the department and may be adjusted annually, any revisions to the benefit cap shall be subject to the provisions of Sections 14124.162 and 14124.163.
(d)Pregnancy-related benefits and benefits for the treatment of other conditions that might complicate the pregnancy are not subject to the benefit cap amount in subdivision (c).
(e)The benefit cap amount in subdivision (c) does not apply to the following:
(1)Beneficiaries under the Early and Periodic Screening, Diagnosis, and Treatment Program.
(2)Beneficiaries receiving long-term care in a nursing facility that is both of the following:
(A)A skilled nursing facility or intermediate care facility as defined in subdivisions (c), (d), (e), (g), and (h), respectively, of Section 1250 of the Health and Safety Code, and facilities providing continuous skilled nursing care to developmentally disabled individuals pursuant to the program established by Section 14132.20.
(B)A licensed nursing facility pursuant to subdivision (k) of Section 1250 of the Health and Safety Code.
(f)For managed care health plans that contract with the department

pursuant to this chapter or Chapter 8 (commencing with Section 14200), except for contracts with the Senior Care Action Network and AIDS Healthcare Foundation, payments for optional hearing aid benefits shall be reduced by the actuarial equivalent amount of the benefit reductions resulting from the implementation of the benefit cap amount specified in this section pursuant to contract amendments or change orders effective on July 1, 2011, or any date thereafter.

(g)This section shall be implemented only to the extent permitted by federal law.
(h)Notwithstanding the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), the department may implement the provisions of this section by means of all-county letters, provider bulletins, or similar instructions, without taking

further regulatory action.

(i)This section shall be implemented on the first day of the first calendar month following 210 days after the effective date of this section, or on the first day of the first calendar month following 60 days after the date the department secures all necessary federal approvals to implement this section, whichever is later. If the implementation date occurs after July 1, 2011, then the benefit cap described in subdivision (c) for the first year of implementation shall be applied from the implementation date through June 30 of the state fiscal year in which implementation commences. Thereafter, the benefit cap shall apply on a state fiscal year basis.

Amended by Stats. 2021, Ch. 143, Sec. 386. (AB 133) Effective July 27, 2021. Operative July 1, 2016, by Stats. 2016, Ch. 30, Sec. 36.

(a)Notwithstanding this chapter, Chapter 8 (commencing with Section 14200), or Chapter 8.75 (commencing with Section 14591), in order to implement changes in the level of funding for health care services, specific optional benefits are excluded from coverage under the Medi-Cal program.
(b)(1) The following optional benefits are excluded from coverage under the Medi-Cal program:

(A) Adult dental services, except as specified in paragraph (2).

(i)This exclusion shall be in effect only through December 31, 2017, and adult dental services shall

be covered under the Medi-Cal program as of January 1, 2018, or the effective date of any necessary federal approvals, whichever is later.

(ii) The restoration of adult dental services pursuant to clause (i) shall be effective only to the extent any necessary federal approvals are obtained as required by subdivision (f).

(B) Audiology services and speech therapy services.

(C) Chiropractic services.

(D) Optometric and optician services, including services provided by a fabricating optical laboratory, except as provided in subdivision (g).

(E) Podiatric services.

(F) Incontinence creams and washes.

(2)(A) Medical and surgical services provided by a doctor of dental medicine or dental surgery, which, if provided by a physician, would be considered physician services, and which services may be provided by either a physician or a dentist in this state, are covered.
(B)Emergency procedures are also covered in the categories of service specified in subparagraph (A). The director may adopt regulations for any of the services specified in subparagraph (A).
(C)Effective May 1, 2014, or the effective date of any necessary federal approvals as required by subdivision (f), whichever is later, for persons 21

years of age or older, adult dental benefits, subject to utilization controls, are limited to all the following medically necessary services:

(i)Examinations, radiographs/photographic images, prophylaxis, and fluoride treatments.

(ii) Amalgam and composite restorations.

(iii) Stainless steel, resin, and resin window crowns.

(iv) Anterior root canal therapy.

(v)Complete dentures, including immediate dentures.

(vi) Complete denture adjustments, repairs, and relines.

(D) Services

specified in this paragraph shall be included as a covered medical benefit under the Medi-Cal program pursuant to Section 14132.89.

(3)Pregnancy-related services and services for the treatment of other conditions that might complicate the pregnancy are not excluded from coverage under this section.
(c)The optional benefit exclusions do not apply to either of the following:
(1)Beneficiaries under the Early and Periodic Screening, Diagnostic, and Treatment Program.
(2)Beneficiaries receiving long-term care in a nursing facility that is both:
(A)A skilled nursing facility or

intermediate care facility as defined in subdivisions (c) and (d) of Section 1250 of the Health and Safety Code.

(B)Licensed pursuant to subdivision (k) of Section 1250 of the Health and Safety Code.
(d)This section shall only be implemented to the extent permitted by federal law.
(e)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement the provisions of this section by means of all-county letters, provider bulletins, or similar instructions, without taking further regulatory action.
(f)This section shall be implemented only to the extent that federal financial

participation is available and any necessary federal approvals have been obtained.

(g)(1) Effective no sooner than January 1, 2020, or January 1 of the subsequent calendar year following the legislative action pursuant to paragraph (2), whichever is later, and subject to paragraph (2) and subdivision (f), optometric and optician services, including services provided by a fabricating optical laboratory, shall be covered benefits under the Medi-Cal program.
(2)The restoration of optometric and optician services pursuant to this subdivision is contingent upon the Legislature including funding for these services in the state budget process.
(h)Effective no sooner than January 1, 2020, all of the following optional

benefits shall be covered benefits under the Medi-Cal program:

(1)Audiology services and speech therapy services.
(2)Podiatric services.
(3)Incontinence creams and washes.

Added by Stats. 2014, Ch. 31, Sec. 50. (SB 857) Effective June 20, 2014.

(a)Notwithstanding any other provision of this chapter or Chapter 8 (commencing with Section 14200), any increase in the amount charged to the Medi-Cal program for patient care or treatment that is directly related to an identifiable provider-preventable condition is excluded from reimbursement under Medi-Cal, in accordance with criteria set forth in federal and state law and the state’s Medi-Cal State Plan, except when the provider-preventable condition existed prior to the initiation of treatment for that patient by that provider.
(b)The exclusion from reimbursement specified in subdivision (a) applies to the amounts charged for the care and treatment of individuals eligible under the Medi-Cal

program, both in fee-for-service and managed care delivery systems, including individuals dually eligible for both the Medicare and Medi-Cal programs, individuals eligible under the California Children’s Services Program, and individuals eligible under the Genetically Handicapped Persons Program.

(c)Exclusion from reimbursement under Medi-Cal pursuant to this section for increased amounts charged to Medi-Cal related to a provider-preventable condition shall be limited to the extent the identified provider-preventable condition would otherwise result in an increase in payment and the state can reasonably isolate for nonpayment the portion of the payment directly related to treatment for, and related to, the provider-preventable condition.
(d)For health care-acquired conditions, the department may limit application of the exclusion from reimbursement as appropriate for specific

populations, including, but not limited to, the pediatric population, after consultation with the federal government and stakeholders.

(e)For health care-acquired conditions, the exclusion of reimbursement is initially limited to only those services provided by inpatient hospitals. For other provider-preventable conditions, the exclusion from reimbursement applies to health care services provided by any provider. This subdivision shall not limit the department from excluding from reimbursement those services provided in additional care settings as determined by the department. The department shall notify and consult with appropriate stakeholders prior to implementing, interpreting, or making specific this subdivision.
(f)Medi-Cal providers, in both fee-for-service and managed care delivery systems, shall report the occurrence of any provider-preventable condition in any

individual identified in subdivision (b) that did not exist prior to initiation of treatment by that provider. The report shall be made to the department as specified by the department, regardless of whether or not the provider seeks Medi-Cal reimbursement for services to treat the provider-preventable condition.

(g)If a provider in either a fee-for-service or managed care delivery system receives a Medi-Cal payment or reimbursement for any increase in costs for patient care or treatment directly related to an identifiable provider-preventable condition that was not present when the individual initiated treatment with that provider, the provider shall reimburse those costs to the department or plan.
(h)For purposes of this section, “provider-preventable condition,” “health care-acquired condition,” and “other provider-preventable condition” are defined as set forth in Section

447.26(b) of Title 42 of the Code of Federal Regulations.

(i)A provider is prohibited from pursuing payment or reimbursement from a beneficiary for any increased amounts directly related to treatment for, and related to, the provider-preventable condition.
(j)(1) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section by means of plan letters, plan or provider bulletins, or similar instructions, without taking regulatory action, until the time regulations are adopted. Prior to issuing any letter, bulletin, or similar instruction authorized pursuant to this section, the department shall notify and consult with stakeholders, including advocates, providers, and beneficiaries. The department shall notify the appropriate policy

and fiscal committees of the Legislature of its intent to issue instructions under this section at least five days in advance of the issuance. It is the intent of the Legislature that the department be provided temporary authority as necessary to implement program changes until completion of the regulatory process, which shall further address and take into account the input of stakeholders.

(2)The department shall adopt emergency regulations pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code no later than January 1, 2017. The department may readopt any emergency regulation authorized by this section that is the same as or substantially equivalent to an emergency regulation previously adopted under this section. The initial adoption of emergency regulations and one readoption of emergency regulations implementing this section shall be deemed an emergency and necessary for the

immediate preservation of the public peace, health, safety, or general welfare.

(3)Initial emergency regulations and the one readoption of emergency regulations authorized by this section shall be exempt from review by the Office of Administrative Law. The initial emergency regulations and the one readoption of emergency regulations shall be submitted to the Office of Administrative Law for filing with the Secretary of State and each shall remain in effect for no more than 180 days, by which time final regulations may be adopted.
(k)The department shall seek any necessary federal approvals for the implementation of this section.
(l)This section shall be implemented only to the extent that federal financial participation is not jeopardized.
(m)This

section shall be implemented in accordance with the methodology set forth in the state plan in effect on July 1, 2012, and subsequently in accordance with any future methodologies approved by the federal Centers for Medicare and Medicaid Services.

Added by Stats. 1992, Ch. 722, Sec. 120. Effective September 15, 1992.

(a)In geographic areas in which Medi-Cal managed care plans contracting under this chapter or Chapter 8 (commencing with Section 14200) are operating with capacity to enroll additional qualifying Medi-Cal beneficiaries, the director may, in the interest of bringing managed care principles to bear on the quality, costs, or utilization levels of the Medi-Cal program, designate any benefit or service included in the Medi-Cal program, at state option under federal medicaid rules, as a covered Medi-Cal benefit only when provided by a Medi-Cal

managed care plan to a Medi-Cal enrollee of the plan.

(b)Where benefits and services have been designated by the director under subdivision (a), beneficiaries who are eligible to enroll in and reside in the service area of a managed care plan, and who desire coverage for such benefits and services, must enroll in a Medi-Cal managed care plan to receive them and shall, to the maximum extent permitted under federal law, remain enrolled in the plan.
(c)When managed care capacity is reached in an area in which Medi-Cal benefits have been designated under this section, the director may provide for the delivery of designated benefits or services to beneficiaries by contract to the extent permitted under this chapter, on a fee-for-service basis or a combination of both.
(d)Exercise of the director’s discretion under this

section shall not preclude Medi-Cal managed care contractors from applying their established medical necessity criteria, utilization control standards and policies and utilization review procedures in delivering designated services as permitted and controlled by Medi-Cal contract and other state and federal regulatory standards.

(e)Enactment of this section shall not impose any requirement on a Medi-Cal managed care plan to negotiate or enter into a contract or any other participation arrangement with any provider of a Medi-Cal benefit or service designated under subdivision (a).
(f)The department shall seek all federal waivers necessary to allow for federal financial participation in expenditures under this section.

Amended by Stats. 2025, Ch. 21, Sec. 101. (AB 116) Effective June 30, 2025.

The following is the schedule of benefits under this chapter:

(a)Outpatient services are covered as follows:

Physician, hospital or clinic outpatient, surgical center, respiratory care, optometric, chiropractic, psychology, podiatric, occupational therapy, physical therapy, speech therapy, audiology, acupuncture to the extent federal matching funds are provided for acupuncture, and services of persons rendering treatment by prayer or healing by spiritual means in the practice of any church or religious denomination insofar as these can be encompassed by federal participation under an approved plan, subject to utilization controls.

(b)(1) Inpatient

hospital services, including, but not limited to, physician and podiatric services, physical therapy, and occupational therapy, are covered subject to utilization controls.

(2)For a Medi-Cal fee-for-service beneficiary, emergency services and care that are necessary for the treatment of an emergency medical condition and medical care directly related to the emergency medical condition. This paragraph does not change the obligation of Medi-Cal managed care plans to provide emergency services and care. For the purposes of this paragraph, “emergency services and care” and “emergency medical condition” have the same meanings as those terms are defined in Section 1317.1 of the Health and Safety Code.
(c)Nursing facility services, subacute care services, and services provided by any category of intermediate care facility for the developmentally disabled, including podiatry, physician,

nurse practitioner services, and prescribed drugs, as described in subdivision (d), are covered subject to utilization controls. Respiratory care, physical therapy, occupational therapy, speech therapy, and audiology services for patients in nursing facilities and any category of intermediate care facility for persons with developmental disabilities are covered subject to utilization controls.

(d)(1) Purchase of prescribed drugs is covered subject to the Medi-Cal List of Contract Drugs and utilization controls.
(2)Purchase of drugs used to treat erectile dysfunction or any off-label uses of those drugs are covered only to the extent that federal financial participation is available.
(3)(A) To the extent required by federal law, the purchase of outpatient prescribed

drugs, for which the prescription is executed by a prescriber in written, nonelectronic form on or after April 1, 2008, is covered only when executed on a tamper resistant prescription form. The implementation of this paragraph shall conform to the guidance issued by the federal Centers for Medicare and Medicaid Services, but shall not conflict with state statutes on the characteristics of tamper resistant prescriptions for controlled substances, including Section 11162.1 of the Health and Safety Code. The department shall provide providers and beneficiaries with as much flexibility in implementing these rules as allowed by the federal government. The department shall notify and consult with appropriate stakeholders in implementing, interpreting, or making specific this paragraph.

(B)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may take the actions

specified in subparagraph (A) by means of a provider bulletin or notice, policy letter, or other similar instructions without taking regulatory action.

(4)(A) (i) For the purposes of this paragraph, nonlegend has the same meaning as defined in subdivision (a) of Section 14105.45.

(ii) Nonlegend acetaminophen-containing products, including children’s acetaminophen-containing products, selected by the department are covered benefits.

(iii) Nonlegend cough and cold products selected by the department are covered benefits.

(B)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may take the actions specified in subparagraph (A) by

means of a provider bulletin or notice, policy letter, or other similar instruction without taking regulatory action.

(e)Outpatient dialysis services and home hemodialysis services, including physician services, medical supplies, drugs, and equipment required for dialysis, are covered, subject to utilization controls.
(f)Anesthesiologist services when provided as part of an outpatient medical procedure, nurse anesthetist services when rendered in an inpatient or outpatient setting under conditions set forth by the director, outpatient laboratory services, and x-ray services are covered, subject to utilization controls. This subdivision does not require prior authorization for anesthesiologist services provided as part of an outpatient medical procedure or for portable x-ray services in a nursing facility or any category of intermediate care facility for the developmentally

disabled.

(g)Blood and blood derivatives are covered.
(h)(1) Emergency and essential diagnostic and restorative dental services, except for orthodontic, fixed bridgework, and partial dentures that are not necessary for balance of a complete artificial denture, are covered, subject to utilization controls. The utilization controls shall allow emergency and essential diagnostic and restorative dental services and prostheses that are necessary to prevent a significant disability or to replace previously furnished prostheses that are lost or destroyed due to circumstances beyond the beneficiary’s control. Notwithstanding the foregoing, the director may by regulation provide for certain fixed artificial dentures necessary for obtaining employment or for medical conditions that preclude the use of removable dental prostheses, and for orthodontic services in cleft

palate deformities administered by the department’s California Children’s Services program.

(2)For persons 21 years of age or older, the services specified in paragraph (1) shall be provided subject to the following conditions:
(A)Periodontal treatment is not a benefit.
(B)Endodontic therapy is not a benefit except for vital pulpotomy.
(C)Laboratory processed crowns are not a benefit.
(D)Removable prosthetics shall be a benefit only for patients as a requirement for employment.
(E)The director may, by regulation, provide for the provision of fixed artificial dentures that are necessary for medical conditions that

preclude the use of removable dental prostheses.

(F)Notwithstanding the conditions specified in subparagraphs (A) to (E), inclusive, the department may approve services for persons with special medical disorders subject to utilization review.
(3)Paragraph (2) shall become inoperative on July 1, 1995.
(i)Medical transportation is covered, subject to utilization controls.
(j)Home health care services are covered, subject to utilization controls.
(k)(1) Prosthetic and orthotic devices and eyeglasses are covered, subject to utilization controls. Utilization controls shall allow replacement of prosthetic and orthotic devices and eyeglasses necessary because of loss or

destruction due to circumstances beyond the beneficiary’s control. Frame styles for eyeglasses replaced pursuant to this subdivision shall not change more than once every two years, unless the department so directs.

(2)Orthopedic and conventional shoes are covered when provided by a prosthetic and orthotic supplier on the prescription of a physician and when at least one of the shoes will be attached to a prosthesis or brace, subject to utilization controls. Modification of stock conventional or orthopedic shoes when medically indicated is covered, subject to utilization controls. If there is a clearly established medical need that cannot be satisfied by the modification of stock conventional or orthopedic shoes, custom-made orthopedic shoes are covered, subject to utilization controls.
(3)Therapeutic shoes and inserts are covered when provided to a beneficiary with a diagnosis

of diabetes, subject to utilization controls, to the extent that federal financial participation is available.

(l)Hearing aids are covered, subject to utilization controls. Utilization controls shall allow replacement of hearing aids necessary because of loss or destruction due to circumstances beyond the beneficiary’s control.
(m)Durable medical equipment and medical supplies are covered, subject to utilization controls. The utilization controls shall allow the replacement of durable medical equipment and medical supplies when necessary because of loss or destruction due to circumstances beyond the beneficiary’s control. The utilization controls shall allow authorization of durable medical equipment needed to assist a disabled beneficiary in caring for a child for whom the disabled beneficiary is a parent, stepparent, foster parent, or legal guardian, subject to the

availability of federal financial participation. The department shall adopt emergency regulations to define and establish criteria for assistive durable medical equipment in accordance with the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

(n)Family planning services are covered, subject to utilization controls. However, for Medi-Cal managed care plans, utilization controls shall be subject to Section 1367.25 of the Health and Safety Code.
(o)Inpatient intensive rehabilitation hospital services, including respiratory rehabilitation services, in a general acute care hospital are covered, subject to utilization controls, when either of the following criteria are met:
(1)A patient with a permanent

disability or severe impairment requires an inpatient intensive rehabilitation hospital program as described in Section 14064 to develop function beyond the limited amount that would occur in the normal course of recovery.

(2)A patient with a chronic or progressive disease requires an inpatient intensive rehabilitation hospital program as described in Section 14064 to maintain the patient’s present functional level as long as possible.
(p)(1) Adult day health care is covered in accordance with Chapter 8.7 (commencing with Section 14520).
(2)Commencing 30 days after the effective date of the act that added this paragraph, and notwithstanding the number of days previously approved through a treatment authorization request, adult day health care is covered for a maximum of three days per

week.

(3)As provided in accordance with paragraph (4), adult day health care is covered for a maximum of five days per week.
(4)As of the date that the director makes the declaration described in subdivision (g) of Section 14525.1, paragraph (2) shall become inoperative and paragraph (3) shall become operative.
(q)(1) Application of fluoride, or other appropriate fluoride treatment as defined by the department, and other prophylaxis treatment for children 17 years of age and under are covered.
(2)All dental hygiene services provided by a registered dental hygienist, registered dental hygienist in extended functions, and registered dental hygienist in alternative practice licensed pursuant to Sections 1753, 1917, 1918, and 1922

of the Business and Professions Code may be covered as long as they are within the scope of Denti-Cal benefits and they are necessary services provided by a registered dental hygienist, registered dental hygienist in extended functions, or registered dental hygienist in alternative practice.

(r)(1) Paramedic services performed by a city, county, or special district, or pursuant to a contract with a city, county, or special district, and pursuant to a program established under former Article 3 (commencing with Section 1480) of Chapter 2.5 of Division 2 of the Health and Safety Code by a paramedic certified pursuant to that article, and consisting of defibrillation and those services specified in subdivision (3) of former Section 1482 of the article.
(2)A provider enrolled under this subdivision shall satisfy all applicable statutory and regulatory

requirements for becoming a Medi-Cal provider.

(3)This subdivision shall be implemented only to the extent funding is available under Section 14106.6.
(s)(1) In-home medical care services are covered when medically appropriate and subject to utilization controls, for a beneficiary who would otherwise require care for an extended period of time in an acute care hospital at a cost higher than in-home medical care services. The director shall have the authority under this section to contract with organizations qualified to provide in-home medical care services to those persons. These services may be provided to a patient placed in a shared or congregate living arrangement, if a home setting is not medically appropriate or available to the beneficiary.
(2)As used in this subdivision, “in-home

medical care service” includes utility bills directly attributable to continuous, 24-hour operation of life-sustaining medical equipment, to the extent that federal financial participation is available.

(3)As used in this subdivision, in-home medical care services include, but are not limited to:
(A)Level-of-care and cost-of-care evaluations.
(B)Expenses, directly attributable to home care activities, for materials.
(C)Physician fees for home visits.
(D)Expenses directly attributable to home care activities for shelter and modification to shelter.
(E)Expenses directly attributable to additional costs of special diets,

including tube feeding.

(F)Medically related personal services.
(G)Home nursing education.
(H)Emergency maintenance repair.
(I)Home health agency personnel benefits that permit coverage of care during periods when regular personnel are on vacation or using sick leave.
(J)All services needed to maintain antiseptic conditions at stoma or shunt sites on the body.
(K)Emergency and nonemergency medical transportation.
(L)Medical supplies.
(M)Medical equipment, including, but not limited to,

scales, gurneys, and equipment racks suitable for paralyzed patients.

(N)Utility use directly attributable to the requirements of home care activities that are in addition to normal utility use.
(O)Special drugs and medications.
(P)Home health agency supervision of visiting staff that is medically necessary, but not included in the home health agency rate.
(Q)Therapy services.
(R)Household appliances and household utensil costs directly attributable to home care activities.
(S)Modification of medical equipment for home use.
(T)Training and orientation for

use of life-support systems, including, but not limited to, support of respiratory functions.

(U)Respiratory care practitioner services as defined in Sections 3702 and 3703 of the Business and Professions Code, subject to prescription by a physician and surgeon.
(4)A beneficiary receiving in-home medical care services is entitled to the full range of services within the Medi-Cal scope of benefits as defined by this section, subject to medical necessity and applicable utilization control. Services provided pursuant to this subdivision, which are not otherwise included in the Medi-Cal schedule of benefits, shall be available only to the extent that federal financial participation for these services is available in accordance with a home- and community-based services waiver.
(t)Home- and community-based services

approved by the United States Department of Health and Human Services are covered to the extent that federal financial participation is available for those services under the state plan or waivers granted in accordance with Section 1315 or 1396n of Title 42 of the United States Code. The director may seek waivers for any or all home- and community-based services approvable under Section 1315 or 1396n of Title 42 of the United States Code. Coverage for those services shall be limited by the terms, conditions, and duration of the federal waivers.

(u)Comprehensive perinatal services, as provided through an agreement with a health care provider designated in Section 14134.5 and meeting the standards developed by the department pursuant to Section 14134.5, subject to utilization controls.

The department shall seek any federal waivers necessary to implement the provisions of this subdivision. The provisions

for which appropriate federal waivers cannot be obtained shall not be implemented. Provisions for which waivers are obtained or for which waivers are not required shall be implemented notwithstanding any inability to obtain federal waivers for the other provisions. No provision of this subdivision shall be implemented unless matching funds from Subchapter XIX (commencing with Section 1396) of Chapter 7 of Title 42 of the United States Code are available.

(v)Early and periodic screening, diagnosis, and treatment for any individual under 21 years of age is covered, consistent with the requirements of Subchapter XIX (commencing with Section 1396) of Chapter 7 of Title 42 of the United States Code.
(w)(1) Hospice services are covered, in accordance with Medicare requirements, and are subject to utilization controls. Coverage shall be available only to the extent that no additional net program costs are incurred.
(2)This subdivision shall be implemented only to the extent that federal financial participation is available and not otherwise jeopardized, and any necessary federal approvals have been obtained.
(3)Notwithstanding any other law, the department, without taking any further regulatory action, may implement, interpret, or make specific this subdivision by means of all-county letters, plan letters, plan or provider bulletins, or similar instructions.
(x)When a

claim for treatment provided to a beneficiary includes both services that are authorized and reimbursable under this chapter and services that are not reimbursable under this chapter, that portion of the claim for the treatment and services authorized and reimbursable under this chapter shall be payable.

(y)Home- and community-based services approved by the United States Department of Health and Human Services for a beneficiary with a diagnosis of Acquired Immune Deficiency Syndrome (AIDS) or AIDS-related complex, who requires intermediate care or a higher level of care.

Services provided pursuant to a waiver obtained from the Secretary of the United States Department of Health and Human Services pursuant to this subdivision, and that are not otherwise included in the Medi-Cal schedule of benefits, shall be available only to the extent that federal financial participation for these services is

available in accordance with the waiver, and subject to the terms, conditions, and duration of the waiver. These services shall be provided to a beneficiary in accordance with the client’s needs as identified in the plan of care, and subject to medical necessity and applicable utilization control.

The director may, under this section, contract with organizations qualified to provide, directly or by subcontract, services provided for in this subdivision to an eligible beneficiary. Contracts or agreements entered into pursuant to this division shall not be subject to the Public Contract Code.

(z)Respiratory care when provided in organized health care systems as defined in Section 3701 of the Business and Professions Code, and as an in-home medical service as outlined in subdivision (s).

(aa) (1) There is hereby

established in the department a program to provide comprehensive clinical family planning services to any person who has a family income at or below 200 percent of the federal poverty level, as revised annually, and who is eligible to receive these services pursuant to the waiver identified in paragraph (2). This program shall be known as the Family Planning, Access, Care, and Treatment (Family PACT) Program.

(2)The department shall seek a waiver in accordance with Section 1315 of Title 42 of the United States Code, or a state plan amendment adopted in accordance with Section 1396a(a)(10)(A)(ii)(XXI) of Title 42 of the United States Code, which was added to Section 1396a of Title 42 of the United States Code by Section 2303(a)(2) of the federal Patient Protection and Affordable Care Act (PPACA) (Public Law 111-148), for a program to provide comprehensive clinical family planning services as described in paragraph (8). Under the waiver, the

program shall be operated only in accordance with the waiver and the statutes and regulations in paragraph (4) and subject to the terms, conditions, and duration of the waiver. Under the state plan amendment, which shall replace the waiver and shall be known as the Family PACT successor state plan amendment, the program shall be operated only in accordance with this subdivision and the statutes and regulations in paragraph (4). The state shall use the standards and processes imposed by the state on January 1, 2007, including the application of an eligibility discount factor to the extent required by the federal Centers for Medicare and Medicaid Services, for purposes of determining eligibility as permitted under Section 1396a(a)(10)(A)(ii)(XXI) of Title 42 of the United States Code. To the extent that federal financial participation is available, the program shall continue to conduct education, outreach, enrollment, service delivery, and evaluation services as specified under the waiver. The services shall

be provided under the program only if the waiver and, when applicable, the successor state plan amendment are approved by the federal Centers for Medicare and Medicaid Services and only to the extent that federal financial participation is available for the services. This section does not prohibit the department from seeking the Family PACT successor state plan amendment during the operation of the waiver.

(3)Solely for the purposes of the waiver or Family PACT successor state plan amendment and notwithstanding any other law, the collection and use of an individual’s social security number shall be necessary only to the extent required by federal law.
(4)Sections 14105.3 to 14105.39, inclusive, 14107.11, 24005, and 24013, and any regulations adopted under these statutes shall apply to the program provided for under this subdivision. No other law under the Medi-Cal program or the

State-Only Family Planning Program shall apply to the program provided for under this subdivision.

(5)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, without taking regulatory action, the provisions of the waiver after its approval by the federal Centers for Medicare and Medicaid Services and the provisions of this section by means of an all-county letter or similar instruction to providers. Thereafter, the department shall adopt regulations to implement this section and the approved waiver in accordance with the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. Beginning six months after the effective date of the act adding this subdivision, the department shall provide a status report to the Legislature on a semiannual basis until regulations have been adopted.
(6)If the Department of Finance determines that the program operated under the authority of the waiver described in paragraph (2) or the Family PACT successor state plan amendment is no longer cost effective, this subdivision shall become inoperative on the first day of the first month following the issuance of a 30-day notification of that determination in writing by the Department of Finance to the chairperson in each house that considers appropriations, the chairpersons of the committees, and the appropriate subcommittees in each house that considers the State Budget, and the Chairperson of the Joint Legislative Budget Committee.
(7)If this subdivision ceases to be operative, all persons who have received or are eligible to receive comprehensive clinical family planning services pursuant to the waiver described in paragraph (2) shall receive family planning services under the

Medi-Cal program pursuant to subdivision (n) if they are otherwise eligible for Medi-Cal with no spend down of excess income, or shall receive comprehensive clinical family planning services under the program established in Division 24 (commencing with Section 24000) either if they are eligible for Medi-Cal with a spend down of excess income or if they are otherwise eligible under Section 24003.

(8)For purposes of this subdivision, “comprehensive clinical family planning services” means the process of establishing objectives for the number and spacing of children, and selecting the means by which those objectives may be achieved. These means include a broad range of acceptable and effective methods and services to limit or enhance fertility, including contraceptive methods, federal Food and Drug Administration-approved contraceptive drugs, devices, and supplies, natural family planning, abstinence methods, and basic, limited fertility

management. Comprehensive clinical family planning services include, but are not limited to, preconception counseling, maternal and fetal health counseling, general reproductive health care, including diagnosis and treatment of infections and conditions, including cancer, that threaten reproductive capability, medical family planning treatment and procedures, including supplies and followup, and informational, counseling, and educational services. Comprehensive clinical family planning services shall not include abortion, pregnancy testing solely for the purposes of referral for abortion or services ancillary to abortions, or pregnancy care that is not incident to the diagnosis of pregnancy. Comprehensive clinical family planning services shall be subject to utilization control and include all of the following:

(A)Family planning related services and male and female sterilization. Family planning services for men and women shall include

emergency services and services for complications directly related to the contraceptive method, federal Food and Drug Administration-approved contraceptive drugs, devices, and supplies, and followup, consultation, and referral services, as indicated, which may require treatment authorization requests.

(B)All United States Department of Agriculture, federal Food and Drug Administration-approved contraceptive drugs, devices, and supplies that are in keeping with current standards of practice and from which the individual may choose.
(C)Culturally and linguistically appropriate health education and counseling services, including informed consent, that include all of the following:
(i)Psychosocial and medical aspects of contraception.

(ii) Sexuality.

(iii) Fertility.

(iv) Pregnancy.

(v)Parenthood.

(vi) Infertility.

(vii) Reproductive health care.

(viii) Preconception and nutrition counseling.

(ix) Prevention and treatment of sexually transmitted infection.

(x)Use of contraceptive methods, federal Food and Drug Administration-approved contraceptive drugs, devices, and supplies.

(xi) Possible contraceptive consequences and followup.

(xii) Interpersonal communication and negotiation of relationships to assist individuals and couples in effective contraceptive method use and planning families.

(D) A comprehensive health history, updated at the next periodic visit (between 11 and 24 months after initial examination) that includes a complete obstetrical history, gynecological history, contraceptive history, personal medical history, health risk factors, and family health history, including genetic or hereditary conditions.

(E) A complete physical examination on initial and subsequent periodic visits.

(F) Services, drugs, devices, and supplies deemed by the federal Centers for Medicare and Medicaid Services to be appropriate for inclusion in the program.

(G) (i) Home test kits for sexually transmitted diseases, including any laboratory costs of processing the kit, that are deemed medically necessary or appropriate and ordered directly by an enrolled Medi-Cal or Family PACT clinician or furnished through a standing order for patient use based on clinical guidelines and individual patient health needs.

(ii) For purposes of this subparagraph, “home test kit” means a product used for a test recommended by the federal Centers for Disease Control and Prevention guidelines or the United States Preventive Services Task Force that has been CLIA-waived, FDA-cleared or -approved, or developed by a laboratory in accordance with established regulations and quality standards, to allow individuals to self-collect specimens for STDs, including HIV, remotely at a location outside of a clinical setting.

(iii) Reimbursement under this subparagraph shall be contingent upon the addition of codes specific to home test kits in the Current Procedural Terminology or Healthcare Common Procedure Coding System to comply with Health Insurance Portability and Accountability Act requirements. The home test kit shall be sent by the enrolled Family PACT provider to a Medi-Cal-enrolled laboratory with fee based on Medicare Clinical Diagnostic Laboratory Tests Payment System Final Rule.

(9)In order to maximize the availability of federal financial participation under this subdivision, the director shall have the discretion to implement the Family PACT successor state plan amendment retroactively to July 1, 2010.

(ab) (1) Purchase of prescribed enteral nutrition products is covered, subject to the Medi-Cal list of

enteral nutrition products and utilization controls.

(2)Purchase of enteral nutrition products is limited to those products to be administered through a feeding tube, including, but not limited to, a gastric, nasogastric, or jejunostomy tube. A beneficiary under the Early and Periodic Screening, Diagnostic, and Treatment Program shall be exempt from this paragraph.
(3)Notwithstanding paragraph (2), the department may deem an enteral nutrition product, not administered through a feeding tube, including, but not limited to, a gastric, nasogastric, or jejunostomy tube, a benefit for patients with diagnoses, including, but not limited to, malabsorption and inborn errors of metabolism, if the product has been shown to be neither investigational nor experimental when used as part of a therapeutic regimen to prevent serious disability or death.
(4)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement the amendments to this subdivision made by the act that added this paragraph by means of all-county letters, provider bulletins, or similar instructions, without taking regulatory action.
(5)The amendments made to this subdivision by the act that added this paragraph shall be implemented June 1, 2011, or on the first day of the first calendar month following 60 days after the date the department secures all necessary federal approvals to implement this section, whichever is later.

(ac) Diabetic testing supplies are covered when provided by a pharmacy, subject to utilization controls.

(ad) (1) Nonmedical transportation is covered, subject to utilization controls and permissible time and distance standards, for a beneficiary to obtain covered Medi-Cal services.

(2)(A) (i) Nonmedical transportation includes, at a minimum, round trip transportation for a beneficiary to obtain covered Medi-Cal services by passenger car, taxicab, or any other form of public or private conveyance, and mileage reimbursement when conveyance is in a private vehicle arranged by the beneficiary and not through a transportation broker, bus passes, taxi vouchers, or train tickets.

(ii) Nonmedical transportation does not include the transportation of a sick, injured, invalid, convalescent, infirm, or otherwise incapacitated beneficiary by ambulance, litter van, or wheelchair van licensed, operated, and equipped in accordance with state and

local statutes, ordinances, or regulations.

(B)Nonmedical transportation shall be provided for a beneficiary who can attest in a manner to be specified by the department that other currently available resources have been reasonably exhausted. For a beneficiary enrolled in a managed care plan, nonmedical transportation shall be provided by the beneficiary’s managed care plan. For a Medi-Cal fee-for-service beneficiary, the department shall provide nonmedical transportation when those services are not available to the beneficiary under Sections 14132.44 and 14132.47.
(3)Nonmedical transportation shall be provided in a form and manner that is accessible, in terms of physical and geographic accessibility, for the beneficiary and consistent with applicable state and federal disability rights laws.
(4)It is the intent

of the Legislature in enacting this subdivision to affirm the requirement under Section 431.53 of Title 42 of the Code of Federal Regulations, in which the department is required to provide necessary transportation, including nonmedical transportation, for recipients to and from covered services. This subdivision shall not be interpreted to add a new benefit to the Medi-Cal program.

(5)The department shall seek any federal approvals that may be required to implement this subdivision, including, but not limited to, approval of revisions to the existing state plan that the department determines are necessary to implement this subdivision.
(6)This subdivision shall be implemented only to the extent that federal financial participation is available and not otherwise jeopardized and any necessary federal approvals have been obtained.
(7)Prior to the effective date of any necessary federal approvals, nonmedical transportation was not a Medi-Cal managed care benefit with the exception of when provided as an Early and Periodic Screening, Diagnostic, and Treatment service.
(8)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department, without taking any further regulatory action, shall implement, interpret, or make specific this subdivision by means of all-county letters, plan letters, plan or provider bulletins, or similar instructions until the time regulations are adopted. By July 1, 2018, the department shall adopt regulations in accordance with the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. Commencing January 1, 2018, and notwithstanding Section 10231.5 of the

Government Code, the department shall provide a status report to the Legislature on a semiannual basis, in compliance with Section 9795 of the Government Code, until regulations have been adopted.

(9)This subdivision shall not be implemented until July 1, 2017.

(ae) (1) No sooner than January 1, 2022, Rapid Whole Genome Sequencing, including individual sequencing, trio sequencing for a parent or parents and their baby, and ultra-rapid sequencing, is a covered benefit for any Medi-Cal beneficiary who is one year of age or younger and is receiving inpatient hospital services in an intensive care unit.

(2)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department, without taking any further regulatory action, shall

implement, interpret, or make specific this subdivision by means of all-county letters, plan letters, plan or provider bulletins, or similar instructions until the time regulations are adopted.

(3)This subdivision shall be implemented only to the extent that any necessary federal approvals are obtained, and federal financial participation is available and not otherwise jeopardized.

(af) (1) Home test kits for sexually transmitted diseases that are deemed medically necessary or appropriate and ordered directly by an enrolled Medi-Cal clinician or furnished through a standing order for patient use based on clinical guidelines and individual patient health needs.

(2)For purposes of this subdivision, “home test kit” means a product used for a test recommended by the federal Centers for Disease

Control and Prevention guidelines or the United States Preventive Services Task Force that has been CLIA-waived, FDA-cleared or -approved, or developed by a laboratory in accordance with established regulations and quality standards, to allow individuals to self-collect specimens for STDs, including HIV, remotely at a location outside of a clinical setting.

(3)Reimbursement under this subparagraph shall be contingent upon the addition of codes specific to home test kits in the Current Procedural Terminology or Healthcare Common Procedure Coding System to comply with Health Insurance Portability and Accountability Act requirements. The home test kit shall be sent by the enrolled Medi-Cal provider to a Medi-Cal-enrolled laboratory with fee based on Medicare Clinical Diagnostic Laboratory Tests Payment System Final Rule.
(4)This subdivision shall be implemented only to the extent

that federal financial participation is available and not otherwise jeopardized, and any necessary federal approvals have been obtained.

(5)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the State Department of Health Care Services may implement this subdivision by means of all-county letters, plan letters, plan or provider bulletins, or similar instructions, without taking any further regulatory action.

(ag) (1) Violence prevention services are covered, subject to medical necessity and utilization controls.

(2)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department, without taking any further regulatory action, may implement, interpret, or make

specific this subdivision by means of all-county letters, plan letters, plan or provider bulletins, or similar instructions until the time regulations are adopted.

(3)This subdivision shall be implemented only to the extent that any necessary federal approvals are obtained, and federal financial participation is available and not otherwise jeopardized.
(4)The department shall post on its internet website the date upon which violence prevention services may be provided and billed pursuant to this subdivision.
(5)“Violence prevention services” means evidence-based, trauma-informed, and culturally responsive preventive services provided to reduce the incidence of violent injury or reinjury, trauma, and related harms and promote trauma recovery, stabilization, and improved health

outcomes.

Amended by Stats. 2005, Ch. 503, Sec. 1. Effective January 1, 2006.

(a)Notwithstanding any other provision of law, a community clinic or free clinic licensed pursuant to subdivision (a) of Section 1204 of the Health and Safety Code or an intermittent clinic operating pursuant to subdivision (h) of Section 1206 of the Health and Safety Code, that has a valid license pursuant to Article 13 (commencing with Section 4180) of Chapter 9 of Division 2 of the Business and Professions Code shall bill and be reimbursed, as described in this section, for drugs and supplies covered under the Medi-Cal program and

Family PACT Waiver Program.

(b)(1) A clinic described in subdivision (a) shall bill the Medi-Cal program and Family PACT Waiver Program for drugs and supplies covered under those programs at the lesser of cost or the clinic’s usual charge made to the general public.
(2)For purposes of this section, “cost” means an aggregate amount equivalent to the sum of the actual acquisition cost of a drug or supply plus a clinic dispensing fee not to exceed twelve dollars ($12) per billing unit as identified in either the Family PACT Policies, Procedures, and Billing Instructions Manual, or the Medi-Cal Inpatient/Outpatient Provider Manual governing outpatient clinic billing for drugs and supplies, as applicable. For purposes of this section, “cost” for a take-home drug that is dispensed for use by the patient within a specific timeframe of five or less days from the

date medically indicated means actual acquisition cost for that drug plus a clinic dispensing fee, not to exceed seventeen dollars ($17) per prescription. Reimbursement shall be at the lesser of the amount billed or the Medi-Cal reimbursement rate, and shall not exceed the net cost of these drugs or supplies when provided by retail pharmacies under the Medi-Cal program.

(c)A clinic described in subdivision (a) that furnishes services free of charge, or at a nominal charge, as defined in subsection (a) of Section 413.13 of Title 42 of the Code of Federal Regulations, or that can demonstrate to the department, upon request, that it serves primarily low-income patients, and its customary practice is to charge patients on the basis of their ability to pay, shall not be subject to reimbursement reductions based on its usual charge to the general public.
(d)Federally qualified health

centers and rural health clinics that are clinics as described in subdivision (a) may bill and be reimbursed as described in this section, upon electing to be reimbursed for pharmaceutical goods and services on a fee-for-service basis, as permitted by subdivision (k) of Section 14132.100.

(e)A clinic that otherwise meets the qualifications set forth in subdivision (a), that is eligible to, but that has elected not to, utilize drugs purchased under the 340B Discount Drug Program for its Medi-Cal patients, shall provide notification to the Health Resources and Services Administration’s Office of Pharmacy Affairs that it is utilizing non-340B drugs for its Medi-Cal patients in the manner and to the extent required by federal law.

Amended (as added by Stats. 2013, 1st Ex. Sess., Ch. 4, Sec. 28) by Stats. 2013, Ch. 442, Sec. 13. (SB 28) Effective January 1, 2014.

(a)The department shall seek approval from the United States Secretary of Health and Human Services to provide individuals made eligible pursuant to Section 14005.60 with the alternative benefit package option authorized by Section 1396u-7(b)(1)(D) of Title 42 of the United States Code. Effective January 1, 2014, the alternative benefit package shall provide the same schedule of benefits provided to full-scope Medi-Cal beneficiaries qualifying under the modified adjusted gross income standard pursuant to Section 1396a(e)(14) of Title 42 of the United States Code, except coverage of long-term services and supports shall be excluded unless otherwise required by Section 1396u-7(a)(2) of Title 42 of the United States Code or made available pursuant to subdivision (b).

The alternative benefit package shall also include any benefits otherwise required by Section 1396u-7 of Title 42 of the United States Code and any regulations or guidance issued pursuant to that section.

(b)Notwithstanding Section 14005.64, and only to the extent federal approval is obtained, the department shall provide coverage for long-term services and supports to only those individuals who meet the asset requirements imposed under the Medi-Cal program for receipt of the services.
(c)For purposes of this section, long-term services and supports include nursing facility services, a level of care in any institution equivalent to nursing facility services, home- and community-based services furnished under the state plan or a waiver under Section 1315 or 1396n of Title 42 of the United States Code, home health services as described in Section 1396d(a)(7) of Title 42 of the

United States Code, and personal care services described in Section 1396d(a)(24) of Title 42 of the United States Code.

(d)The department may seek approval of any necessary state plan amendments or waivers to implement this section.
(e)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section by means of all-county letters, plan letters, plan or provider bulletins, or similar instructions until the time any necessary regulations are adopted. The department shall adopt regulations by July 1, 2017, in accordance with the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. Beginning six months after the effective date of this section, and notwithstanding Section 10231.5 of the

Government Code, the department shall provide a status report to the Legislature on a semiannual basis, in compliance with Section 9795 of the Government Code, until regulations have been adopted.

(f)This section shall be implemented only to the extent that federal financial participation is available and any necessary federal approvals have been obtained.

Added by Stats. 2024, Ch. 632, Sec. 6. (AB 1316) Effective January 1, 2025.

(a)Notwithstanding any other law, emergency services and care necessary for the treatment of an emergency medical condition, as defined in subdivision (b) of Section 1317.1 of the Health and Safety Code, are a covered benefit.

For purposes of this section, “emergency services and care” has the same meaning as defined in Section 438.114 of Title 42 of the Code of Federal Regulations and paragraph (1) of, and subparagraph (A) of paragraph (2) of, subdivision (a) of Section 1317.1 of the Health and Safety Code.

(b)For a beneficiary with a psychiatric emergency medical condition, as defined in subdivision (k) of Section 1317.1 of the Health and Safety Code, emergency services and care necessary to relieve or eliminate that condition are covered, regardless of whether the beneficiary is voluntary, or involuntarily detained for

assessment, evaluation, and crisis intervention, or placement for evaluation and treatment pursuant to the Lanterman-Petris-Short Act (Part 1 (commencing with Section 5000) of Division 5 of the Welfare and Institutions Code).

(c)(1) A Medi-Cal managed care plan, as defined in subdivision (j) of Section 14184.101, shall be responsible for covering, and reimbursing providers furnishing, the emergency services and care described in subdivisions (a) and (b), and any poststabilization care services required under Section 438.114 of Title 42 of the Code of Federal Regulations,

for its enrolled Medi-Cal beneficiaries, excluding any Medi-Cal specialty mental health services provided once an enrolled beneficiary is admitted for inpatient psychiatric care.

(2)This subdivision does not limit or reduce the scope of covered emergency services and care described in subdivisions (a) and (b) for Medi-Cal fee-for-service beneficiaries.
(d)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section by means of all-plan letters, information notices, plan or provider bulletins, or similar instructions

until the department can promulgate any necessary regulations.

(e)For purposes of this section, emergency services and care includes emergency room professional services and facility charges for emergency room visits.
(f)This section shall be implemented in a manner consistent with federal law and only to the extent

federal financial participation is available and not otherwise jeopardized.

(g)The Legislature finds and declares that this section is intended to clarify, and not expand, the scope of Medi-Cal covered benefits.

Added by Stats. 2013, 1st Ex. Sess., Ch. 4, Sec. 29. (SB 1 1x) Effective September 30, 2013.

(a)The following shall be covered Medi-Cal benefits effective January 1, 2014:
(1)Mental health services included in the essential health benefits package adopted by the state pursuant to Section 1367.005 of the Health and Safety Code and Section 10112.27 of the Insurance Code and approved by the United States Secretary of Health and Human Services under Section 18022 of Title 42 of the United States Code. To the extent behavioral health treatment services are considered mental health services pursuant to the essential health benefits package, these services shall only be provided to individuals who receive services through federally approved waivers or state plan amendments pursuant to the

Lanterman Developmental Disability Services Act, at Division 4.5 (commencing with Section 4500).

(2)Substance use disorder services included in the essential health benefits package adopted by the state pursuant to Section 1367.005 of the Health and Safety Code and Section 10112.27 of the Insurance Code and approved by the United States Secretary of Health and Human Services under Section 18022 of Title 42 of the United States Code.
(b)The department may seek approval of any necessary state plan amendments to implement this section.
(c)This section shall be implemented only to the extent that federal financial participation is available and any necessary federal approvals have been obtained.

Added by Stats. 2000, Ch. 93, Sec. 90. Effective July 7, 2000.

The department shall provide the fiscal and appropriate policy committees of the Legislature with a copy of their submittal to the federal Health Care Financing Administration pertaining to any evaluation completed regarding the Family PACT federal waiver required by subdivision (aa) of Section 14132.

Amended by Stats. 2016, Ch. 86, Sec. 320. (SB 1171) Effective January 1, 2017.

(a)Services specified in this section that are provided by a local educational agency are covered Medi-Cal benefits, to the extent federal financial participation is available, and subject to utilization controls and standards adopted by the department, and consistent with Medi-Cal requirements for physician prescription, order, and supervision.
(b)Any provider enrolled on or after January 1, 1993, to provide services pursuant to this section may bill for those services provided on or after January 1, 1993.
(c)This section shall not be interpreted to expand the current category of professional health care practitioners permitted to directly bill the Medi-Cal program.
(d)This section is not intended to increase the scope of practice of any health professional providing services under this section or Medi-Cal requirements for physician prescription, order, and supervision.
(e)(1) For the purposes of this section, the local educational agency, as a condition of enrollment to provide services under this section, shall be considered the provider of services. A local educational agency provider, as a condition of enrollment to provide services under this section, shall enter into, and maintain, a contract with the department in accordance with guidelines contained in regulations adopted by the director and published in Title 22 of the California Code of Regulations.
(2)Notwithstanding paragraph (1), a local educational agency providing services pursuant to this

section shall utilize current safety net and traditional health care providers, when those providers are accessible to specific schoolsites identified by the local educational agency to participate in this program, rather than adding duplicate capacity.

(f)For the purposes of this section, covered services may include all of the following local educational agency services:
(1)Health and mental health evaluations and health and mental health education.
(2)Medical transportation.
(A)The following provisions shall not apply to medical transportation eligible to be billed under this section:
(i)Section 51323(a)(2)(A) of Title 22 of the California Code of Regulations.

(ii) Section 51323(a)(3)(B) of Title 22 of the California Code of Regulations.

(iii) For students whose medical or physical condition does not require the use of a gurney, Section 51231.1(f) of Title 22 of the California Code of Regulations.

(iv) For students whose medical or physical condition does not require the use of a wheelchair, Section 51231.2(e) of Title 22 of the California Code of Regulations.

(B) (i) Subparagraph (A) shall become inoperative on January 1, 2018, or on the date the director executes a declaration stating that the regulations implementing subparagraph (A) and Section 14115.8 have been updated, whichever is later.

(ii) The department shall post

the declaration executed under clause (i) on its Internet Web site and transmit a copy of the declaration to the Assembly Committee on Budget and the Senate Committee on Budget and Fiscal Review and the LEA Ad Hoc Workgroup.

(iii) If subparagraph (A) becomes inoperative on January 1, 2018, subparagraph (A) and this subparagraph shall be inoperative on January 1, 2018, unless a later enacted statute enacted before that date, deletes or extends that date.

(iv) If subparagraph (A) becomes inoperative on the date the director executes a declaration as described in clause (i), subparagraph (A) and this subparagraph shall be inoperative on the January 1 immediately following the date subparagraph (A) becomes inoperative, unless a later enacted statute enacted before that date, deletes or extends that date.

(3)Nursing

services.

(4)Occupational therapy.
(5)Physical therapy.
(6)Physician services.
(7)Mental health and counseling services.
(8)School health aide services.
(9)Speech pathology services. These services may be provided by either of the following:
(A)A licensed speech pathologist.
(B)A credentialed speech-language pathologist, to the extent authorized by Chapter 5.3 (commencing with Section 2530) of Division 2 of the Business and Professions Code.
(10)Audiology services.
(11)Targeted case management services for children regardless of whether the child has an individualized education plan (IEP) or an individualized family service plan (IFSP).
(g)Local educational agencies may, but need not, provide any or all of the services specified in subdivision (f).
(h)For the purposes of this section, “local educational agency” means the governing body of any school district or community college district, the county office of education, a charter school, a state special school, a California State University campus, or a University of California campus.
(i)Notwithstanding any other law, a community college district, a California State University

campus, or a University of California campus, consistent with the requirements of this section, may bill for services provided to any student, regardless of age, who is a Medi-Cal recipient.

(j)No later than July 1, 2013, and every year thereafter, the department shall make publicly accessible an annual accounting of all funds collected by the department from federal Medicaid payments allocable to local educational agencies, including, but not limited to, the funds withheld pursuant to subdivision (g) of Section 14115.8. The accounting shall detail amounts withheld from federal Medicaid payments to each participating local educational agency for that year. One-time costs for the development of this accounting shall not exceed two hundred fifty thousand dollars ($250,000).
(k)(1) If the requirements in paragraphs (2) and (4) are satisfied, the department

shall seek federal financial participation for covered services that are provided by a local educational agency pursuant to subdivision (a) to a child who is an eligible Medi-Cal beneficiary, regardless of either of the following:

(A) Whether the child has an IEP or an IFSP.

(B) Whether those same services are provided at no charge to the beneficiary or to the community at large.

(2)The local educational agency shall take all reasonable measures to ascertain and pursue claims for payment of covered services specified in this section against legally liable third parties pursuant to Section 1902(a)(25) of the federal Social Security Act (42 U.S.C. Sec. 1396a(a)(25)).
(3)If a legally liable third party receives a claim submitted by a local educational

agency pursuant to paragraph (2), the legally liable third party shall either reimburse the claim or issue a notice of denial of noncoverage of services or benefits. If there is no response to a claim submitted to a legally liable third party by a local educational agency within 45 days, the local educational agency may bill the Medi-Cal program pursuant to subdivision (b). The local educational agency shall retain a copy of the claim submitted to the legally liable third party for a period of three years.

(4)This subdivision shall not be implemented until the department obtains any necessary federal approvals.

Added by Stats. 2017, Ch. 572, Sec. 3. (SB 743) Effective January 1, 2018.

(a)A Medi-Cal managed care plan shall not restrict the choice of the qualified provider from whom a beneficiary enrolled in the managed care plan may receive family planning services covered by the Medi-Cal program pursuant to subdivision (n) of Section 14132.
(b)The following definitions shall apply for purposes of this section:
(1)“Medi-Cal managed care plan” means an applicable organization or entity that contracts with the department to provide services to enrolled Medi-Cal beneficiaries pursuant to any of the following:
(A)Article 2.7 (commencing with Section 14087.3).
(B)Article 2.8 (commencing with Section 14087.5).
(C)Article 2.81 (commencing with Section 14087.96).
(D)Article 2.82 (commencing with Section 14087.98).
(E)Article 2.91 (commencing with Section 14089).
(F)Chapter 8 (commencing with Section 14200).
(2)“Qualified provider” means a provider that is licensed to furnish family planning services, is an enrolled Medi-Cal provider, and is willing to furnish family planning services to an enrollee. A qualified provider may be an out-of-plan or out-of-network provider.
(c)A Medi-Cal managed care plan shall reimburse an out-of-plan or out-of-network qualified provider at the applicable fee-for-service rate.
(d)If federal approval is required to implement this section, the section shall be implemented only to the extent that federal approval is obtained.

Added by Stats. 2023, Ch. 401, Sec. 3. (SB 496) Effective January 1, 2024.

(a)By July 1, 2024, biomarker testing, as specified in this section, is a covered benefit, subject to utilization controls and medical necessity requirements, as described in Section 14059.5. Biomarker testing shall be covered for the purposes of diagnosis, treatment, appropriate management, or ongoing monitoring of a Medi-Cal beneficiary’s disease or condition to guide treatment decisions. Coverage shall include biomarker tests that meet any of the following:
(1)A labeled indication for a test that has been approved or cleared by the United States Food and Drug Administration (FDA) or is an indicated test for an FDA-approved drug.
(2)A national coverage determination made by the federal Centers for Medicare and Medicaid Services, to the extent allowed under the Medicaid program.
(3)A local coverage determination made by a Medicare Administrative Contractor for California.
(4)Evidence-based clinical practice guidelines, supported by peer-reviewed literature and peer-reviewed scientific studies published in or accepted for publication by medical journals that meet nationally recognized requirements for scientific manuscripts and that submit most of their

published articles for review by experts who are not part of the editorial staff.

(5)Standards set by the National Academy of Medicine.
(b)(1) This section does not preclude any obligation on a Medi-Cal managed care plan subject to Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code, including any obligations under Section 1363.5 of the Health and Safety Code.
(2)This section does not require coverage of biomarker testing for screening purposes unless otherwise required by this chapter.
(3)The department shall direct, by means of all-county letters, plan letters, plan or provider bulletins, or similar

instructions, that biomarker testing is to be provided in a manner that limits disruptions in care.

(c)Restricted or denied use of biomarker testing for the purpose of diagnosis, treatment, or ongoing monitoring of any medical condition is subject to grievance and appeal processes under state and federal law.
(d)This section shall be implemented only to the extent that federal financial participation is available and not otherwise jeopardized, and any necessary federal approvals have been obtained.
(e)(1) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, and make specific this section by means of all-county letters, plan letters, plan or provider bulletins, or similar instructions, without taking any further regulatory action.
(2)An all-county letter, plan letter, plan or provider bulletin, or similar instructions promulgated pursuant to paragraph (1) shall be based at a minimum on

evidence-based clinical practice guidelines.

(f)For purposes of this section, the following definitions apply:
(1)“Biomarker” means a characteristic that is objectively measured and evaluated as an indicator of normal biological processes, pathogenic processes, or pharmacologic responses to a specific therapeutic intervention. A biomarker includes, but is not limited to, gene mutations or protein expression.
(2)“Biomarker testing” is the analysis of an individual’s tissue, blood, or other biospecimen for the presence of a biomarker. Biomarker testing includes, but is not limited to, single-analyte tests, multiplex panel tests, and whole genome sequencing.
(g)This section is subject to the provisions of Section 1367.665 of the Health and Safety Code as amended by Chapter 605 of the Statutes of 2021 for a Medi-Cal beneficiary with advanced or metastatic stage III or IV cancer covered by a Medi-Cal managed care plan.

Amended by Stats. 1982, Ch. 328, Sec. 36. Effective June 30, 1982.

As used in this chapter “surgical center” means a surgical clinic that is licensed under Section 1203 of the Health and Safety Code. Pursuant to Section 14105, the director shall establish the rates of payment for services provided by surgical centers.

Amended by Stats. 2019, Ch. 64, Sec. 1. (AB 781) Effective January 1, 2020.

(a)(1) Pediatric day health care provided by a health facility licensed under paragraph (11) of subdivision (a) of Section 1250.1 of the Health and Safety Code is a covered benefit under this chapter subject to terms, conditions, and utilization controls developed by the department. Pediatric day health care does not include inpatient long-term care or family respite care.
(2)Pediatric day health care services may be provided at any time of the day and on any day of the week, so long as the total number of authorized hours is not exceeded. Pediatric

day health care services may be covered for up to 23 hours per calendar day.

(b)The department shall publish emergency regulations for pediatric day health care services by October 1, 1997. These regulations shall reimburse providers at a rate that shall be determined by the department, consistent with efficiency, economy, and quality of care until a new rate is determined on the basis of a cost study conducted by the department.
(c)Coverage for pediatric day health care services shall be available only to the extent that no additional net program costs are incurred.
(d)The department shall not approve a request for authorization of pediatric day health care when the beneficiary for whom the

authorization is requested is an inpatient in a licensed health care facility.

(e)The department shall not approve a request for authorization of pediatric day health care if the department determines that the total cost incurred by the Medi-Cal program for providing pediatric day health care services and all other medically necessary services to the individual beneficiary is greater than the total cost incurred by the Medi-Cal program in providing medically equivalent services at the beneficiary’s otherwise appropriate level of institutional or home care.
(f)Coverage for pediatric day health care services shall be available only to the extent that federal financial participation in the cost of providing these services is available pursuant to a federally approved state plan

amendment including those services as a Medi-Cal program benefit.

Current Version

Amended by Stats. 2025, Ch. 21, Sec. 103. (AB 116) Effective June 30, 2025. Inoperative July 1, 2026, by its own provisions. Repealed as of January 1, 2027, by its own provisions. See later operative version added by Sec. 104 of Stats. 2025, Ch. 21.

(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of “visit” set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1 thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural

health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.

(e)(1) An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set

forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:

(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of

patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.

(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Services Administration (HRSA).
(3)A change in costs is not, in and of itself, a scope-of-service change, unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination

thereof.

(D)The net change in the FQHC’s or RHC’s rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. “Net change” means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHC’s or RHC’s fiscal year. Any approved increase or decrease in the provider’s rate shall be retroactive to the beginning of the FQHC’s or RHC’s fiscal year in which the

request is submitted.

(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHC’s or RHC’s prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, “significantly lower” means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service

change or changes were initially implemented on or after the first day of an FQHC’s or RHC’s fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHC’s or RHC’s fiscal year ending in 2003.

(7)All references in this subdivision to “fiscal year” shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1) An FQHC or RHC may request a

supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHC’s or RHC’s PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a

supplemental payment is not warranted.

(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include both of the following:
(A)A presentation of data to demonstrate reasons for the FQHC’s or RHC’s request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facility’s total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the department’s discretionary decision in writing.
(g)(1) An FQHC or RHC “visit” means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant,

nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, licensed professional clinical counselor, or a visiting nurse. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal practitioner, as defined in Section 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plan’s definition of an FQHC or RHC visit.

(2)(A) A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services

of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHC’s or RHC’s rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHC’s or RHC’s application for, or the department’s approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other

FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the provider’s rate shall be made within six months after the date of receipt of the department’s rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.

(C)An FQHC or RHC that does not provide dental hygienist or dental hygienist in alternative practice services, and later elects to add these services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(3)Notwithstanding any other provision of this section, no later than July 1, 2018, a visit shall include a marriage and family therapist.
(4)(A) (i) Subject to subparagraphs (C) and (D), a visit shall also include an encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, licensed professional clinical counselor, visiting nurse, comprehensive perinatal services program practitioner, dental hygienist, dental hygienist in alternative practice, or marriage and family therapist using video synchronous interaction, when services delivered through that interaction meet the applicable standard of care. A visit described in this clause shall be reimbursed at the applicable FQHC’s or RHC’s per-visit PPS rate to the extent

the department determines that the FQHC or RHC has met all billing requirements that would have applied if the applicable services were delivered via a face-to-face encounter. An FQHC or RHC is not precluded from establishing a new patient relationship through video synchronous interaction. An FQHC patient who receives telehealth services shall otherwise be eligible to receive in-person services from that FQHC pursuant to HRSA requirements.

(ii) Subject to subparagraphs (C) and (D), a visit shall also include an encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, licensed professional clinical counselor, visiting nurse, comprehensive perinatal services program practitioner, dental hygienist, dental hygienist in alternative practice, or marriage and family therapist using audio-only synchronous interaction, when

services delivered through that modality meet the applicable standard of care. A visit described in this clause shall be reimbursed at the applicable FQHC’s or RHC’s per-visit PPS rate to the extent the department determines that the FQHC or RHC has met all billing requirements that would have applied if the applicable services were delivered via a face-to-face encounter.

(iii) Subject to subparagraphs (C) and (D), a visit shall also include an encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, licensed professional clinical counselor, visiting nurse, comprehensive perinatal services program practitioner, dental hygienist, dental hygienist in alternative practice, or marriage and family therapist using an asynchronous store and forward modality, when services delivered through that modality meet the applicable

standard of care. A visit described in this clause shall be reimbursed at the applicable FQHC’s or RHC’s per-visit PPS rate to the extent the department determines that the FQHC or RHC has met all billing requirements that would have applied if the applicable services were delivered via a face-to-face encounter.

(iv) (I) An FQHC or RHC may not establish a new patient relationship using an audio-only synchronous interaction.

(II) Notwithstanding subclause (I), the department may provide for exceptions to the prohibition established by subclause (I), including, but not limited to, the exceptions described in sub-subclauses (ia) and (ib), which shall be developed in consultation with affected stakeholders and published in departmental guidance.

(ia) Notwithstanding the prohibition in subclause (I)

and subject to subparagraphs (C) and (D), an FQHC or RHC may establish a new patient relationship using an audio-only synchronous interaction when the visit is related to sensitive services, as defined in subdivision (n) of Section 56.05 of the Civil Code, and when established in accordance with department-specific requirements and consistent with federal and state laws, regulations, and guidance.

(ib) Notwithstanding the prohibition in subclause (I) and subject to subparagraphs (C) and (D), an FQHC or RHC may establish a new patient relationship using an audio-only synchronous interaction when the patient requests an audio-only modality or attests they do not have access to video, and when established in accordance with department-specific requirements and consistent with federal and state laws, regulations, and guidance.

(v)An FQHC or RHC is not precluded from establishing a

new patient relationship through an asynchronous store and forward modality, as defined in subdivision (a) of Section 2290.5 of the Business and Professions Code, if the visit meets all of the following conditions:

(I) The patient is physically present at the FQHC or RHC, or at an intermittent site of the FQHC or RHC, at the time the service is performed.

(II) The individual who creates the patient records at the originating site is an employee or contractor of the FQHC or RHC, or other person lawfully authorized by the FQHC or RHC to create a patient record.

(III) The FQHC or RHC determines that the billing provider is able to meet the applicable standard of care.

(IV) An FQHC patient who receives telehealth services shall otherwise be eligible to

receive in-person services from that FQHC pursuant to HRSA requirements.

(B) (i) Pursuant to an effective date designated by the department that is no sooner than January 1, 2024, an FQHC or RHC furnishing applicable health care services via audio-only synchronous interaction shall also offer those same health care services via video synchronous interaction to preserve beneficiary choice.

(ii) The department may provide specific exceptions to the requirement specified in clause (i), based on an FQHC’s or RHC’s access to requisite technologies, which shall be developed in consultation with affected stakeholders and published in departmental guidance.

(iii) Effective on the date designated by the department pursuant to clause (i), an FQHC or RHC furnishing services through video synchronous

interaction or audio-only synchronous interaction shall also do one of the following:

(I) Offer those services via in-person, face-to-face contact.

(II) Arrange for a referral to, and a facilitation of, in-person care that does not require a patient to independently contact a different provider to arrange for that care.

(iv) In addition to any existing law requiring beneficiary consent to telehealth, including, but not limited to, subdivision (b) of Section 2290.5 of the Business and Professions Code, all of the following shall be communicated by an FQHC or RHC to a Medi-Cal beneficiary, in writing or verbally, on at least one occasion prior to, or concurrent with, initiating the delivery of one or more health care services via telehealth to a Medi-Cal beneficiary: an explanation that beneficiaries have the right to

access covered services that may be delivered via telehealth through an in-person, face-to-face visit; an explanation that use of telehealth is voluntary and that consent for the use of telehealth can be withdrawn at any time by the Medi-Cal beneficiary without affecting their ability to access covered Medi-Cal services in the future; an explanation of the availability of Medi-Cal coverage for nonmedical transportation services to in-person visits when other available resources have been reasonably exhausted; and the potential limitations or risks related to receiving services through telehealth as compared to an in-person visit, to the extent any limitations or risks are identified by the FQHC or RHC.

(I) The FQHC or RHC shall document in the patient record the provision of this information and the patient’s verbal or written acknowledgment that the information was received.

(II) The department shall develop, in consultation with affected stakeholders, model language for purposes of the communication described in this subparagraph.

(C) The department shall seek any federal approvals it deems necessary to implement this paragraph. This paragraph shall be implemented only to the extent that any necessary federal approvals are obtained and federal financial participation is available and not otherwise jeopardized.

(D) This paragraph shall be operative on January 1, 2023, or on the operative date or dates reflected in the applicable federal approvals obtained by the department pursuant to subparagraph (C), whichever is later. This paragraph shall not be construed to limit coverage of, and reimbursement for, covered telehealth services provided before the operative date of this paragraph.

(E) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, and make specific this paragraph by means of all-county letters, plan letters, provider manuals, information notices, provider bulletins, and similar instructions, without taking any further regulatory action.

(F) Telehealth modalities authorized pursuant to this paragraph shall be subject to the billing, reimbursement, and utilization management policies imposed by the department.

(G) Services delivered via telehealth modalities described in this paragraph shall comply with the privacy and security requirements contained in the federal Health Insurance Portability and Accountability Act of 1996 found in Parts 160 and 164 of Title 45 of the Code of Federal Regulations, the Medicaid state plan, and any other

applicable state and federal statutes and regulations.

(5)For purposes of this section, “physician” shall be interpreted in a manner consistent with the federal Centers for Medicare and Medicaid Services’ Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor.
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity, as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code, the Medicare Program, or the Child Health and Disability Prevention (CHDP) Program, the

department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.

(i)(1) Provided that the following entities are not operating as intermittent clinics, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, each entity shall have its reimbursement rate established in accordance with one of the methods outlined in paragraph (2) or (3), as selected by the FQHC or RHC:

(A) An entity that first qualifies as an FQHC or RHC in 2001 or later.

(B) A newly licensed facility at a new location added to an existing FQHC or

RHC.

(C) An entity that is an existing FQHC or RHC that is relocated to a new site.

(2)(A) An FQHC or RHC that adds a new licensed location to its existing primary care license under paragraph (1) of subdivision (b) of Section 1212 of the Health and Safety Code may elect to have the reimbursement rate for the new location established in accordance with paragraph (3), or notwithstanding subdivision (e), an FQHC or RHC may choose to have one PPS rate for all locations that appear on its primary care license determined by submitting a change in scope of service request if both of the following requirements are met:
(i)The change in scope of service request includes the costs and visits for those locations for the first full fiscal year immediately following the date the new location is added to

the FQHC’s or RHC’s existing licensee.

(ii) The FQHC or RHC submits the change in scope of service request within 90 days after the FQHC’s or RHC’s first full fiscal year.

(B) The FQHC’s or RHC’s single PPS rate for those locations shall be calculated based on the total costs and total visits of those locations and shall be determined based on the following:

(i)An audit in accordance with Section 14170.

(ii) Rate changes based on a change in scope of service request shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successors.

(iii) Any approved increase

or decrease in the provider’s rate shall be retroactive to the beginning of the FQHC’s or RHC’s fiscal year in which the request is submitted.

(C) Except as specified in subdivision (j), this paragraph does not apply to a location that was added to an existing primary care clinic license by the State Department of Public Health, whether by a regional district office or the centralized application unit, prior to January 1, 2017.

(3)If an FQHC or RHC does not elect to have the PPS rate determined by a change in scope of service request, the FQHC or RHC shall have the reimbursement rate established for any of the entities identified in paragraph (1) or (2) in accordance with one of the following methods at the election of the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to

the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.

(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entity’s one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall

be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.

(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(4)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in

their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.

(5)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC

shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its FQHC or RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHC’s or RHC’s prospective payment rate at that time.

(j)(1) Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, in a mobile unit as defined in subdivision (b) of Section 1765.105 of the Health and Safety Code, or at the election of the FQHC or RHC and subject to paragraph (2), a location added to an existing primary care clinic license by the State Department of Public Health prior to January 1, 2017, shall be billed by and reimbursed at the same rate as the FQHC or RHC that either established the intermittent clinic site or mobile unit,

or that held the clinic license to which the location was added prior to January 1, 2017.

(2)If an FQHC or RHC with at least one additional location on its primary care clinic license that was added by the State Department of Public Health prior to January 1, 2017, applies for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC as described in subdivision (e), all locations on the FQHC’s or RHC’s primary care clinic license shall be subject to a scope-of-service adjustment in accordance with either paragraph (2) or (3) of subdivision (i), as selected by the FQHC or RHC.
(3)This subdivision does not preclude or otherwise limit the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)An FQHC or RHC may elect to have pharmacy or

dental services reimbursed on a fee-for-service basis, utilizing the current fee schedules established for those services. These costs shall be adjusted out of the FQHC’s or RHC’s clinic base rate as scope-of-service changes. An FQHC or RHC that reverses its election under this subdivision shall revert to its prior rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with applicable scope-of-service adjustments as provided in subdivision (e).

(l)Reimbursement for Drug Medi-Cal services shall be provided pursuant to this subdivision.
(1)An FQHC or RHC may elect to have Drug Medi-Cal services reimbursed directly from a county or the department under contract with the FQHC or RHC pursuant to paragraph (4).
(2)(A) For an FQHC or RHC to receive reimbursement for Drug Medi-Cal services directly from the county or the department under contract with the FQHC or RHC pursuant to paragraph (4), costs associated with providing Drug Medi-Cal services shall not be included in the FQHC’s or RHC’s per-visit PPS rate. For purposes of this subdivision, the costs associated with providing Drug Medi-Cal services shall not be considered to be within the FQHC’s or RHC’s clinic base PPS rate if in delivering Drug Medi-Cal services the clinic uses different clinical staff at a different location.
(B)If the FQHC or RHC does not use different clinical staff at a different location to deliver Drug Medi-Cal services, the FQHC or RHC shall submit documentation, in a manner determined by the department, that the current per-visit PPS rate does not include any costs related to rendering Drug

Medi-Cal services, including costs related to utilizing space in part of the FQHC’s or RHC’s building, that are or were previously calculated as part of the clinic’s base PPS rate.

(3)If the costs associated with providing Drug Medi-Cal services are within the FQHC’s or RHC’s clinic base PPS rate, as determined by the department, the Drug Medi-Cal services costs shall be adjusted out of the FQHC’s or RHC’s per-visit PPS rate as a change in scope of service.
(A)An FQHC or RHC shall submit to the department a scope-of-service change request to adjust the FQHC’s or RHC’s clinic base PPS rate after the first full fiscal year of rendering Drug Medi-Cal services outside of the PPS rate. Notwithstanding subdivision (e), the scope-of-service change request shall include a full fiscal year of activity that does not include Drug Medi-Cal services costs.
(B)An FQHC or RHC may submit requests for scope-of-service change under this subdivision only within 90 days following the beginning of the FQHC’s or RHC’s fiscal year. Any scope-of-service change request under this subdivision approved by the department shall be retroactive to the first day that Drug Medi-Cal services were rendered and reimbursement for Drug Medi-Cal services was received outside of the PPS rate, but in no case shall the effective date be earlier than January 1, 2018.
(C)The FQHC or RHC may bill for Drug Medi-Cal services outside of the PPS rate when the FQHC or RHC obtains approval as a Drug Medi-Cal provider and enters into a contract with a county or the department to provide these services pursuant to paragraph (4).
(D)Within 90 days of receipt of the request for a scope-of-service change under

this subdivision, the department shall issue the FQHC or RHC an interim rate equal to 90 percent of the FQHC’s or RHC’s projected allowable cost, as determined by the department. An audit to determine the final rate shall be performed in accordance with Section 14170.

(E)Rate changes based on a request for scope-of-service change under this subdivision shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(F)For purposes of recalculating the PPS rate, the FQHC or RHC shall provide upon request to the department verifiable documentation as to which employees spent time, and the actual time spent, providing federally qualified health center services or rural health center services and Drug Medi-Cal services.
(G)After the department approves the adjustment to the FQHC’s or RHC’s clinic base PPS rate and the FQHC or RHC is approved as a Drug Medi-Cal provider, an FQHC or RHC shall not bill the PPS rate for any Drug Medi-Cal services provided pursuant to a contract entered into with a county or the department pursuant to paragraph (4).
(H)An FQHC or RHC that reverses its election under this subdivision shall revert to its prior PPS rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with the applicable scope-of-service adjustments as provided for in subdivision (e).
(4)Reimbursement for Drug Medi-Cal services shall be determined according to subparagraph (A) or (B), depending on whether the services

are provided in a county that participates in the Drug Medi-Cal organized delivery system (DMC-ODS).

(A)In a county that participates in the DMC-ODS, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract entered into between the county or county designee and the FQHC or RHC. If the county or county designee refuses to contract with the FQHC or RHC, the FQHC or RHC may follow the contract denial process set forth in the Special Terms and Conditions.
(B)In a county that does not participate in the DMC-ODS, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract entered into between the county and the FQHC or RHC. If the county refuses to contract with the FQHC or RHC, the FQHC or RHC may request to contract directly with the department and shall be reimbursed for those services at the Drug Medi-Cal fee-for-service

rate.

(5)The department shall not reimburse an FQHC or RHC pursuant to subdivision (h) for the difference between its per-visit PPS rate and any payments for Drug Medi-Cal services made pursuant to this subdivision.
(6)For purposes of this subdivision, the following definitions apply:
(A)“Drug Medi-Cal organized delivery system” or “DMC-ODS” means the Drug Medi-Cal organized delivery system authorized under the California Medi-Cal 2020 Demonstration, Number 11-W-00193/9, as approved by the federal Centers for Medicare and Medicaid Services and described in the Special Terms and Conditions.
(B)“Special Terms and Conditions” has the same meaning as set forth in subdivision (o) of Section 14184.10.
(m)Reimbursement for specialty mental health services shall be provided pursuant to this subdivision.
(1)An FQHC or RHC and one or more mental health plans that contract with the department pursuant to Section 14712 may mutually elect to enter into a contract to have the FQHC or RHC provide specialty mental health services to Medi-Cal beneficiaries as part of the mental health plan’s network.
(2)(A) For an FQHC or RHC to receive reimbursement for specialty mental health services pursuant to a contract entered into with the mental health plan under paragraph (1), the costs associated with providing specialty mental health services shall not be included in the FQHC’s or RHC’s per-visit PPS rate. For purposes of this subdivision, the costs associated with providing specialty mental health services shall not be considered to be within the FQHC’s

or RHC’s clinic base PPS rate if in delivering specialty mental health services the clinic uses different clinical staff at a different location.

(B)If the FQHC or RHC does not use different clinical staff at a different location to deliver specialty mental health services, the FQHC or RHC shall submit documentation, in a manner determined by the department, that the current per-visit PPS rate does not include any costs related to rendering specialty mental health services, including costs related to utilizing space in part of the FQHC’s or RHC’s building, that are or were previously calculated as part of the clinic’s base PPS rate.
(3)If the costs associated with providing specialty mental health services are within the FQHC’s or RHC’s clinic base PPS rate, as determined by the department, the specialty mental health services costs shall be adjusted out of the FQHC’s or RHC’s

per-visit PPS rate as a change in scope of service.

(A)An FQHC or RHC shall submit to the department a scope-of-service change request to adjust the FQHC’s or RHC’s clinic base PPS rate after the first full fiscal year of rendering specialty mental health services outside of the PPS rate. Notwithstanding subdivision (e), the scope-of-service change request shall include a full fiscal year of activity that does not include specialty mental health costs.
(B)An FQHC or RHC may submit requests for a scope-of-service change under this subdivision only within 90 days following the beginning of the FQHC’s or RHC’s fiscal year. Any scope-of-service change request under this subdivision approved by the department is retroactive to the first day that specialty mental health services were rendered and reimbursement for specialty mental health services was received outside of the PPS rate,

but the effective date shall not be earlier than January 1, 2018.

(C)The FQHC or RHC may bill for specialty mental health services outside of the PPS rate when the FQHC or RHC contracts with a mental health plan to provide these services pursuant to paragraph (1).
(D)Within 90 days of receipt of the request for a scope-of-service change under this subdivision, the department shall issue the FQHC or RHC an interim rate equal to 90 percent of the FQHC’s or RHC’s projected allowable cost, as determined by the department. An audit to determine the final rate shall be performed in accordance with Section 14170.
(E)Rate changes based on a request for scope-of-service change under this subdivision shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section

413.1) of Title 42 of the Code of Federal Regulations, or its successor.

(F)For the purpose of recalculating the PPS rate, the FQHC or RHC shall provide upon request to the department verifiable documentation as to which employees spent time, and the actual time spent, providing federally qualified health center services or rural health center services and specialty mental health services.
(G)After the department approves the adjustment to the FQHC’s or RHC’s clinic base PPS rate, an FQHC or RHC shall not bill the PPS rate for any specialty mental health services that are provided pursuant to a contract entered into with a mental health plan pursuant to paragraph (1).
(H)An FQHC or RHC that reverses its election under this subdivision shall revert to its prior PPS rate, subject to an increase to account for all

Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with the applicable scope-of-service adjustments as provided for in subdivision (e).

(4)The department shall not reimburse an FQHC or RHC pursuant to subdivision (h) for the difference between its per-visit PPS rate and any payments made for specialty mental health services under this subdivision.
(n)The department shall seek any necessary federal approvals and issue appropriate guidance to allow an FQHC or RHC to bill, under a supervising licensed behavioral health practitioner, for an encounter between an FQHC or RHC patient and a psychological associate, associate professional clinical counselor, associate clinical social worker, or associate marriage and family therapist when all of the following conditions are met:
(1)The psychological associate, associate professional clinical counselor, associate clinical social worker, or associate marriage and family therapist is supervised by the designated licensed behavioral health practitioner, as required by their applicable clinical licensing board.
(2)The behavioral health visit is billed under the supervising licensed practitioner of the FQHC or RHC, pursuant to paragraph (1).
(3)The FQHC or RHC is otherwise authorized to bill for services provided by the supervising licensed behavioral health practitioner as a separate visit.
(o)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The

rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.

(p)The department shall promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(q)The department shall implement this section only to the extent that federal financial participation is available.
(r)Notwithstanding any other law, the director may, without taking regulatory action pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division

3 of Title 2 of the Government Code, implement, interpret, or make specific this section by means of a provider bulletin or similar instruction. The department shall notify and consult with interested parties and appropriate stakeholders in implementing, interpreting, or making specific the provisions of this section, including all of the following:

(1)Notifying provider representatives in writing of the proposed action or change. The notice shall occur, and the applicable draft provider bulletin or similar instruction, shall be made available at least 10 business days prior to the meeting described in paragraph (2).
(2)Scheduling at least one meeting with interested parties and appropriate stakeholders to discuss the proposed action or change.
(3)Allowing for written input regarding the proposed action or change,

to which the department shall provide summary written responses in conjunction with the issuance of the applicable final written provider bulletin or similar instruction.

(4)Providing at least 60 days advance notice of the effective date of the proposed action or change.
(s)This section shall become inoperative on July 1, 2026, and, as of January 1, 2027, is repealed.
Future Version

Repealed (in Sec. 103) and added by Stats. 2025, Ch. 21, Sec. 104. (AB 116) Effective June 30, 2025. Operative July 1, 2026, by its own provisions.

(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services that are eligible for federal financial participation shall be reimbursed on a per-visit basis in accordance with the definition of “visit” set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1 thereafter, until no longer required by federal law,

federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.

(e)(1) An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of

providing teaching services to interns and residents.

(I)Any changes in the scope of a project approved by the federal Health Resources and Services Administration (HRSA).
(3)A change in costs is not, in and of itself, a scope-of-service change, unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type,

intensity, duration, or amount of services, or any combination thereof.

(D)The net change in the FQHC’s or RHC’s rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. “Net change” means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHC’s or RHC’s fiscal year. Any approved increase or decrease in the provider’s rate shall be retroactive to

the beginning of the FQHC’s or RHC’s fiscal year in which the request is submitted.

(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHC’s or RHC’s prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, “significantly lower” means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHC’s or RHC’s fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHC’s or RHC’s fiscal year ending in 2003.
(7)All references in this subdivision to “fiscal year” shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1) An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHC’s or RHC’s PPS rate is sufficient to cover its overall costs,

including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.

(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include both of the following:
(A)A presentation of data to demonstrate reasons for the FQHC’s or RHC’s request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facility’s total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the department’s discretionary decision in writing.
(g)(1) An FQHC or RHC “visit” means a face-to-face encounter between an FQHC or

RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, licensed professional clinical counselor, or a visiting nurse that is eligible for federal financial participation. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal practitioner, as defined in Section 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plan’s definition of an FQHC or RHC visit that is eligible for federal financial participation.

(2)(A) A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist that is

eligible for federal financial participation.

(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHC’s or RHC’s rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHC’s or RHC’s application for, or the department’s approval of, a rate adjustment pursuant to this

subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the provider’s rate shall be made within six months after the date of receipt of the department’s rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.

(C)An FQHC or RHC that does not provide dental hygienist or dental hygienist in alternative

practice services, and later elects to add these services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).

(3)Notwithstanding any other provision of this section, no later than July 1, 2018, a visit shall include a marriage and family therapist that is eligible for federal financial participation.
(4)(A) (i) Subject to subparagraphs (C) and (D), a visit shall also include an encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, licensed professional clinical counselor, visiting nurse, comprehensive perinatal services program practitioner, dental hygienist, dental hygienist in alternative practice, or marriage

and family therapist using video synchronous interaction, when services delivered through that interaction meet the applicable standard of care and are eligible for federal financial participation. A visit described in this clause shall be reimbursed at the applicable FQHC’s or RHC’s per-visit PPS rate to the extent the department determines that the FQHC or RHC has met all billing requirements that would have applied if the applicable services were delivered via a face-to-face encounter. An FQHC or RHC is not precluded from establishing a new patient relationship through video synchronous interaction. An FQHC patient who receives telehealth services shall otherwise be eligible to receive in-person services from that FQHC pursuant to HRSA requirements.

(ii) Subject to subparagraphs (C) and (D), a visit shall also include an encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified

nurse-midwife, clinical psychologist, licensed clinical social worker, licensed professional clinical counselor, visiting nurse, comprehensive perinatal services program practitioner, dental hygienist, dental hygienist in alternative practice, or marriage and family therapist using audio-only synchronous interaction, when services delivered through that modality meet the applicable standard of care and are eligible for federal financial participation. A visit described in this clause shall be reimbursed at the applicable FQHC’s or RHC’s per-visit PPS rate to the extent the department determines that the FQHC or RHC has met all billing requirements that would have applied if the applicable services were delivered via a face-to-face encounter.

(iii) Subject to subparagraphs (C) and (D), a visit shall also include an encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical

psychologist, licensed clinical social worker, licensed professional clinical counselor, visiting nurse, comprehensive perinatal services program practitioner, dental hygienist, dental hygienist in alternative practice, or marriage and family therapist using an asynchronous store and forward modality, when services delivered through that modality meet the applicable standard of care and are eligible for federal financial participation. A visit described in this clause shall be reimbursed at the applicable FQHC’s or RHC’s per-visit PPS rate to the extent the department determines that the FQHC or RHC has met all billing requirements that would have applied if the applicable services were delivered via a face-to-face encounter.

(iv) (I) An FQHC or RHC may not establish a new patient relationship using an audio-only synchronous interaction.

(II) Notwithstanding

subclause (I), the department may provide for exceptions to the prohibition established by subclause (I), including, but not limited to, the exceptions described in sub-subclauses (ia) and (ib), which shall be developed in consultation with affected stakeholders and published in departmental guidance.

(ia) Notwithstanding the prohibition in subclause (I) and subject to subparagraphs (C) and (D), an FQHC or RHC may establish a new patient relationship using an audio-only synchronous interaction when the visit is related to sensitive services, as defined in subdivision (n) of Section 56.05 of the Civil Code, and when established in accordance with department-specific requirements and consistent with federal and state laws, regulations, and guidance.

(ib) Notwithstanding the prohibition in subclause (I) and subject to subparagraphs (C) and (D), an FQHC or RHC may establish a new

patient relationship using an audio-only synchronous interaction when the patient requests an audio-only modality or attests they do not have access to video, and when established in accordance with department-specific requirements and consistent with federal and state laws, regulations, and guidance.

(v)An FQHC or RHC is not precluded from establishing a new patient relationship through an asynchronous store and forward modality, as defined in subdivision (a) of Section 2290.5 of the Business and Professions Code, if the visit meets all of the following conditions:

(I) The patient is physically present at the FQHC or RHC, or at an intermittent site of the FQHC or RHC, at the time the service is performed.

(II) The individual who creates the patient records at the originating site is an employee or contractor of the

FQHC or RHC, or other person lawfully authorized by the FQHC or RHC to create a patient record.

(III) The FQHC or RHC determines that the billing provider is able to meet the applicable standard of care.

(IV) An FQHC patient who receives telehealth services shall otherwise be eligible to receive in-person services from that FQHC pursuant to HRSA requirements.

(B) (i) Pursuant to an effective date designated by the department that is no sooner than January 1, 2024, an FQHC or RHC furnishing applicable health care services via audio-only synchronous interaction shall also offer those same health care services via video synchronous interaction to preserve beneficiary choice.

(ii) The department may provide specific exceptions to the

requirement specified in clause (i), based on an FQHC’s or RHC’s access to requisite technologies, which shall be developed in consultation with affected stakeholders and published in departmental guidance.

(iii) Effective on the date designated by the department pursuant to clause (i), an FQHC or RHC furnishing services through video synchronous interaction or audio-only synchronous interaction shall also do one of the following:

(I) Offer those services via in-person, face-to-face contact.

(II) Arrange for a referral to, and a facilitation of, in-person care that does not require a patient to independently contact a different provider to arrange for that care.

(iv) In addition to any existing law requiring beneficiary consent to telehealth, including,

but not limited to, subdivision (b) of Section 2290.5 of the Business and Professions Code, all of the following shall be communicated by an FQHC or RHC to a Medi-Cal beneficiary, in writing or verbally, on at least one occasion prior to, or concurrent with, initiating the delivery of one or more health care services via telehealth to a Medi-Cal beneficiary: an explanation that beneficiaries have the right to access covered services that may be delivered via telehealth through an in-person, face-to-face visit; an explanation that use of telehealth is voluntary and that consent for the use of telehealth can be withdrawn at any time by the Medi-Cal beneficiary without affecting their ability to access covered Medi-Cal services in the future; an explanation of the availability of Medi-Cal coverage for nonmedical transportation services to in-person visits when other available resources have been reasonably exhausted; and the potential limitations or risks related to receiving services through telehealth as

compared to an in-person visit, to the extent any limitations or risks are identified by the FQHC or RHC.

(I) The FQHC or RHC shall document in the patient record the provision of this information and the patient’s verbal or written acknowledgment that the information was received.

(II) The department shall develop, in consultation with affected stakeholders, model language for purposes of the communication described in this subparagraph.

(C) The department shall seek any federal approvals it deems necessary to implement this paragraph. This paragraph shall be implemented only to the extent that any necessary federal approvals are obtained and federal financial participation is available and not otherwise jeopardized.

(D) This paragraph shall be

operative on January 1, 2023, or on the operative date or dates reflected in the applicable federal approvals obtained by the department pursuant to subparagraph (C), whichever is later. This paragraph shall not be construed to limit coverage of, and reimbursement for, covered telehealth services provided before the operative date of this paragraph.

(E) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, and make specific this paragraph by means of all-county letters, plan letters, provider manuals, information notices, provider bulletins, and similar instructions, without taking any further regulatory action.

(F) Telehealth modalities authorized pursuant to this paragraph shall be subject to the billing, reimbursement, and utilization management policies imposed by the

department.

(G) Services delivered via telehealth modalities described in this paragraph shall comply with the privacy and security requirements contained in the federal Health Insurance Portability and Accountability Act of 1996 found in Parts 160 and 164 of Title 45 of the Code of Federal Regulations, the Medicaid state plan, and any other applicable state and federal statutes and regulations.

(5)For purposes of this section, “physician” shall be interpreted in a manner consistent with the federal Centers for Medicare and Medicaid Services’ Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and

surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor.

(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity, as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code, the Medicare Program, or the Child Health and Disability Prevention (CHDP) Program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1) Provided that the following entities are not operating as intermittent clinics, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, each entity shall have its

reimbursement rate established in accordance with one of the methods outlined in paragraph (2) or (3), as selected by the FQHC or RHC:

(A) An entity that first qualifies as an FQHC or RHC in 2001 or later.

(B) A newly licensed facility at a new location added to an existing FQHC or RHC.

(C) An entity that is an existing FQHC or RHC that is relocated to a new site.

(2)(A) An FQHC or RHC that adds a new licensed location to its existing primary care license under paragraph (1) of subdivision (b) of Section 1212 of the Health and Safety Code may elect to have the reimbursement rate for the new location established in accordance with paragraph (3), or notwithstanding subdivision (e), an FQHC or RHC may choose to have one PPS rate for

all locations that appear on its primary care license determined by submitting a change in scope of service request if both of the following requirements are met:

(i)The change in scope of service request includes the costs and visits for those locations for the first full fiscal year immediately following the date the new location is added to the FQHC’s or RHC’s existing licensee.

(ii) The FQHC or RHC submits the change in scope of service request within 90 days after the FQHC’s or RHC’s first full fiscal year.

(B) The FQHC’s or RHC’s single PPS rate for those locations shall be calculated based on the total costs and total visits of those locations and shall be determined based on the following:

(i)An audit in accordance with Section 14170.

(ii) Rate changes based on a change in scope of service request shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successors.

(iii) Any approved increase or decrease in the provider’s rate shall be retroactive to the beginning of the FQHC’s or RHC’s fiscal year in which the request is submitted.

(C) Except as specified in subdivision (j), this paragraph does not apply to a location that was added to an existing primary care clinic license by the State Department of Public Health, whether by a regional district office or the centralized application unit, prior to January 1, 2017.

(3)If an FQHC or RHC does not elect to

have the PPS rate determined by a change in scope of service request, the FQHC or RHC shall have the reimbursement rate established for any of the entities identified in paragraph (1) or (2) in accordance with one of the following methods at the election of the FQHC or RHC:

(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entity’s one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(4)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(5)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its FQHC or RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHC’s or RHC’s prospective payment rate at that time.
(j)(1) Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an

existing FQHC or RHC, in a mobile unit as defined in subdivision (b) of Section 1765.105 of the Health and Safety Code, or at the election of the FQHC or RHC and subject to paragraph (2), a location added to an existing primary care clinic license by the State Department of Public Health prior to January 1, 2017, shall be billed by and reimbursed at the same rate as the FQHC or RHC that either established the intermittent clinic site or mobile unit, or that held the clinic license to which the location was added prior to January 1, 2017.

(2)If an FQHC or RHC with at least one additional location on its primary care clinic license that was added by the State Department of Public Health prior to January 1, 2017, applies for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC as described in subdivision (e), all locations on the FQHC’s or RHC’s primary care clinic license shall be subject to

a scope-of-service adjustment in accordance with either paragraph (2) or (3) of subdivision (i), as selected by the FQHC or RHC.

(3)This subdivision does not preclude or otherwise limit the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)An FQHC or RHC may elect to have pharmacy or dental services reimbursed on a fee-for-service basis, utilizing the current fee schedules established for those services. These costs shall be adjusted out of the FQHC’s or RHC’s clinic base rate as scope-of-service changes. An FQHC or RHC that reverses its election under this subdivision shall revert to its prior rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with applicable scope-of-service adjustments as provided in subdivision

(e).

(l)Reimbursement for Drug Medi-Cal services shall be provided pursuant to this subdivision.
(1)An FQHC or RHC may elect to have Drug Medi-Cal services reimbursed directly from a county or the department under contract with the FQHC or RHC pursuant to paragraph (4).
(2)(A) For an FQHC or RHC to receive reimbursement for Drug Medi-Cal services directly from the county or the department under contract with the FQHC or RHC pursuant to paragraph (4), costs associated with providing Drug Medi-Cal services shall not be included in the FQHC’s or RHC’s per-visit PPS rate. For purposes of this subdivision, the costs associated with providing Drug Medi-Cal services shall not be considered to be within the FQHC’s or RHC’s clinic base PPS rate if in delivering Drug Medi-Cal services the clinic

uses different clinical staff at a different location.

(B)If the FQHC or RHC does not use different clinical staff at a different location to deliver Drug Medi-Cal services, the FQHC or RHC shall submit documentation, in a manner determined by the department, that the current per-visit PPS rate does not include any costs related to rendering Drug Medi-Cal services, including costs related to utilizing space in part of the FQHC’s or RHC’s building, that are or were previously calculated as part of the clinic’s base PPS rate.
(3)If the costs associated with providing Drug Medi-Cal services are within the FQHC’s or RHC’s clinic base PPS rate, as determined by the department, the Drug Medi-Cal services costs shall be adjusted out of the FQHC’s or RHC’s per-visit PPS rate as a change in scope of service.
(A)An FQHC or

RHC shall submit to the department a scope-of-service change request to adjust the FQHC’s or RHC’s clinic base PPS rate after the first full fiscal year of rendering Drug Medi-Cal services outside of the PPS rate. Notwithstanding subdivision (e), the scope-of-service change request shall include a full fiscal year of activity that does not include Drug Medi-Cal services costs.

(B)An FQHC or RHC may submit requests for scope-of-service change under this subdivision only within 90 days following the beginning of the FQHC’s or RHC’s fiscal year. Any scope-of-service change request under this subdivision approved by the department shall be retroactive to the first day that Drug Medi-Cal services were rendered and reimbursement for Drug Medi-Cal services was received outside of the PPS rate, but in no case shall the effective date be earlier than January 1, 2018.
(C)The FQHC or RHC

may bill for Drug Medi-Cal services outside of the PPS rate when the FQHC or RHC obtains approval as a Drug Medi-Cal provider and enters into a contract with a county or the department to provide these services pursuant to paragraph (4).

(D)Within 90 days of receipt of the request for a scope-of-service change under this subdivision, the department shall issue the FQHC or RHC an interim rate equal to 90 percent of the FQHC’s or RHC’s projected allowable cost, as determined by the department. An audit to determine the final rate shall be performed in accordance with Section 14170.
(E)Rate changes based on a request for scope-of-service change under this subdivision shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(F)For purposes of recalculating the PPS rate, the FQHC or RHC shall provide upon request to the department verifiable documentation as to which employees spent time, and the actual time spent, providing federally qualified health center services or rural health center services and Drug Medi-Cal services.
(G)After the department approves the adjustment to the FQHC’s or RHC’s clinic base PPS rate and the FQHC or RHC is approved as a Drug Medi-Cal provider, an FQHC or RHC shall not bill the PPS rate for any Drug Medi-Cal services provided pursuant to a contract entered into with a county or the department pursuant to paragraph (4).
(H)An FQHC or RHC that reverses its election under this subdivision shall revert to its prior PPS rate, subject to an increase to account for all Medicare Economic Index increases occurring

during the intervening time period, and subject to any increase or decrease associated with the applicable scope-of-service adjustments as provided for in subdivision (e).

(4)Reimbursement for Drug Medi-Cal services shall be determined according to subparagraph (A) or (B), depending on whether the services are provided in a county that participates in the Drug Medi-Cal organized delivery system (DMC-ODS).
(A)In a county that participates in the DMC-ODS, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract entered into between the county or county designee and the FQHC or RHC. If the county or county designee refuses to contract with the FQHC or RHC, the FQHC or RHC may follow the contract denial process set forth in the Special Terms and Conditions.
(B)In a county that does not

participate in the DMC-ODS, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract entered into between the county and the FQHC or RHC. If the county refuses to contract with the FQHC or RHC, the FQHC or RHC may request to contract directly with the department and shall be reimbursed for those services at the Drug Medi-Cal fee-for-service rate.

(5)The department shall not reimburse an FQHC or RHC pursuant to subdivision (h) for the difference between its per-visit PPS rate and any payments for Drug Medi-Cal services made pursuant to this subdivision.
(6)For purposes of this subdivision, the following definitions apply:
(A)“Drug Medi-Cal organized delivery system” or “DMC-ODS” means the Drug Medi-Cal organized delivery system authorized under the California Medi-Cal 2020

Demonstration, Number 11-W-00193/9, as approved by the federal Centers for Medicare and Medicaid Services and described in the Special Terms and Conditions.

(B)“Special Terms and Conditions” has the same meaning as set forth in subdivision (o) of Section 14184.10.
(m)Reimbursement for specialty mental health services shall be provided pursuant to this subdivision.
(1)An FQHC or RHC and one or more mental health plans that contract with the department pursuant to Section 14712 may mutually elect to enter into a contract to have the FQHC or RHC provide specialty mental health services to Medi-Cal beneficiaries as part of the mental health plan’s network.
(2)(A) For an FQHC or RHC to receive reimbursement for specialty mental

health services pursuant to a contract entered into with the mental health plan under paragraph (1), the costs associated with providing specialty mental health services shall not be included in the FQHC’s or RHC’s per-visit PPS rate. For purposes of this subdivision, the costs associated with providing specialty mental health services shall not be considered to be within the FQHC’s or RHC’s clinic base PPS rate if in delivering specialty mental health services the clinic uses different clinical staff at a different location.

(B)If the FQHC or RHC does not use different clinical staff at a different location to deliver specialty mental health services, the FQHC or RHC shall submit documentation, in a manner determined by the department, that the current per-visit PPS rate does not include any costs related to rendering specialty mental health services, including costs related to utilizing space in part of the FQHC’s or RHC’s building, that are

or were previously calculated as part of the clinic’s base PPS rate.

(3)If the costs associated with providing specialty mental health services are within the FQHC’s or RHC’s clinic base PPS rate, as determined by the department, the specialty mental health services costs shall be adjusted out of the FQHC’s or RHC’s per-visit PPS rate as a change in scope of service.
(A)An FQHC or RHC shall submit to the department a scope-of-service change request to adjust the FQHC’s or RHC’s clinic base PPS rate after the first full fiscal year of rendering specialty mental health services outside of the PPS rate. Notwithstanding subdivision (e), the scope-of-service change request shall include a full fiscal year of activity that does not include specialty mental health costs.
(B)An FQHC or RHC may submit requests for a

scope-of-service change under this subdivision only within 90 days following the beginning of the FQHC’s or RHC’s fiscal year. Any scope-of-service change request under this subdivision approved by the department is retroactive to the first day that specialty mental health services were rendered and reimbursement for specialty mental health services was received outside of the PPS rate, but the effective date shall not be earlier than January 1, 2018.

(C)The FQHC or RHC may bill for specialty mental health services outside of the PPS rate when the FQHC or RHC contracts with a mental health plan to provide these services pursuant to paragraph (1).
(D)Within 90 days of receipt of the request for a scope-of-service change under this subdivision, the department shall issue the FQHC or RHC an interim rate equal to 90 percent of the FQHC’s or RHC’s projected allowable cost, as

determined by the department. An audit to determine the final rate shall be performed in accordance with Section 14170.

(E)Rate changes based on a request for scope-of-service change under this subdivision shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(F)For the purpose of recalculating the PPS rate, the FQHC or RHC shall provide upon request to the department verifiable documentation as to which employees spent time, and the actual time spent, providing federally qualified health center services or rural health center services and specialty mental health services.
(G)After the department approves the adjustment to the FQHC’s or RHC’s clinic base PPS rate, an FQHC

or RHC shall not bill the PPS rate for any specialty mental health services that are provided pursuant to a contract entered into with a mental health plan pursuant to paragraph (1).

(H)An FQHC or RHC that reverses its election under this subdivision shall revert to its prior PPS rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with the applicable scope-of-service adjustments as provided for in subdivision (e).
(4)The department shall not reimburse an FQHC or RHC pursuant to subdivision (h) for the difference between its per-visit PPS rate and any payments made for specialty mental health services under this subdivision.
(n)The department shall seek any necessary federal approvals and

issue appropriate guidance to allow an FQHC or RHC to bill, under a supervising licensed behavioral health practitioner, for an encounter between an FQHC or RHC patient and a psychological associate, associate professional clinical counselor, associate clinical social worker, or associate marriage and family therapist when all of the following conditions are met:

(1)The psychological associate, associate professional clinical counselor, associate clinical social worker, or associate marriage and family therapist is supervised by the designated licensed behavioral health practitioner, as required by their applicable clinical licensing board.
(2)The behavioral health visit is billed under the supervising licensed practitioner of the FQHC or RHC, pursuant to paragraph (1).
(3)The FQHC or RHC is otherwise authorized

to bill for services provided by the supervising licensed behavioral health practitioner as a separate visit.

(o)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(p)The department shall promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(q)The department shall implement this section only to the extent that federal financial participation is available.
(r)Notwithstanding any other law, the director may, without taking regulatory action pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, implement, interpret, or make specific this section by means of a provider bulletin or similar instruction. The department shall notify and consult with interested parties and appropriate stakeholders in implementing, interpreting, or making specific the provisions of this section, including all of the following:
(1)Notifying provider representatives in writing of the proposed action or change. The notice shall occur, and the applicable draft provider bulletin or similar instruction, shall be made available

at least 10 business days prior to the meeting described in paragraph (2).

(2)Scheduling at least one meeting with interested parties and appropriate stakeholders to discuss the proposed action or change.
(3)Allowing for written input regarding the proposed action or change, to which the department shall provide summary written responses in conjunction with the issuance of the applicable final written provider bulletin or similar instruction.
(4)Providing at least 60 days advance notice of the effective date of the proposed action or change.
(s)This section shall become operative on July 1, 2026.

Added by Stats. 2005, Ch. 548, Sec. 1. Effective January 1, 2006.

(a)Notwithstanding paragraphs (4) and (5) of subdivision (e) of Section 14132.100, a scope-of-service change request, whether mandatory or permissive, shall be timely when filed within 150 days following the beginning of the federally qualified health center’s or rural health clinic’s fiscal year following the year in which the change occurred.
(b)Notwithstanding subdivision (a), and notwithstanding subdivision (e) of Section 14132.100, a federally qualified health center

described in Section 14132.102 shall be deemed to have filed a scope-of-service change in a timely manner upon compliance with the requirements set forth in subdivision (c) of Section 14132.102.

Added by Stats. 2005, Ch. 548, Sec. 2. Effective January 1, 2006.

(a)With the exception of clinics and hospital outpatient departments that are subject to Section 14105.24, federally qualified health centers (FQHCs) that are receiving cost-based reimbursement under the terms of the Los Angeles County 1115 Waiver Demonstration Project on June 30, 2005, shall be required to transition to a prospective payment system (PPS) rate upon expiration of that waiver. These FQHCs shall be referred to in this section as “Los Angeles cost-based FQHCs.”
(b)For visits occurring on or after July 1, 2005, Los Angeles cost-based FQHCs shall receive a PPS rate equivalent to the following:
(1)FQHC sites that were in existence during the FQHC’s 2000 fiscal year shall be permitted to elect their 2000 per-visit rates or the average of the 1999 and 2000 per-visit rates as reported on the cost reports submitted for those fiscal years adjusted as described in subdivision (c).
(2)FQHC sites that were first qualified as an FQHC after the site’s 2000 fiscal year shall receive a base rate equivalent to the first full fiscal year rate, as audited on the cost report submitted for that fiscal year and adjusted as described in subdivision (c).
(3)Sites that were first qualified as an FQHC after the site’s 2000 fiscal year, and that have not yet filed a cost report for

their first full fiscal year shall have a rate set in accordance with subdivision (i) of Section 14132.100 and adjusted as described in subdivision (c).

(c)The base rates described in this section shall be adjusted in the manner described in subdivision (d), paragraphs (1), (2), (3), and (7) of subdivision (e), and subdivision (f) of Section 14132.100.
(d)For Los Angeles cost-based FQHCs, as defined in subdivision (a), no new cost reports shall be required in order to claim scope-of-service changes occurring in fiscal years prior to July 1, 2005. Only the following information shall be required by the department:
(1)A description of the events triggering any applicable rate changes in the form of Worksheet 1 of the Change in Scope-of-Service Request form developed for fiscal years 2004 and thereafter, modified to

identify the applicable fiscal year in which the scope change occurred.

(2)The two worksheets to the Change in Scope-of-Service Request form summarizing the health center’s health care practitioners and services for the applicable fiscal year or years.
(e)Change in Scope-of-Service Request forms for changes occurring prior to July 1, 2005, shall be filed with the department no later than July 1, 2006, and shall be deemed to have been filed only when both the Medi-Cal cost report for the applicable period and the referenced Change in Scope-of-Service Request form worksheets have been filed with the department. The date of filing shall be the date on which either the Medi-Cal cost report or the referenced Change in Scope-of-Service Request forms are received by the department, whichever is later.
(f)Notwithstanding

Section 14132.107, the department shall calculate a tentative scope-of-service rate adjustment based on 80 percent of the difference in the “as reported” scope-of-service per visit cost. This adjustment shall occur no later than 150 days after receipt of the Medi-Cal cost report and the referenced Change in Scope-of-Service Request forms. Within 12 months after receipt of request forms, the department shall complete its FQHC fiscal year audit of the Medi-Cal cost report and associated Change in Scope-of-Service Request and final rate adjustment pursuant to that audit. The final rate adjustment will be retroactive to July 1, 2005. Nothing in this subdivision shall be construed to extend the time period for review and finalization of cost reports as set forth in Section 14170.

(g)The department shall, by no later than March 30, 2006, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the

state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.

(h)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, and only to the extent that all necessary federal approvals are obtained and there is an appropriation for the purposes of implementing this section, the department may implement this section without taking any regulatory action and by means of a provider bulletin or similar instructions.

Added by Stats. 2004, Ch. 228, Sec. 21. Effective August 16, 2004.

Claims for reimbursement under subdivision (e) of Section 14132.100 shall be finalized by the department within 150 days of receipt of the claims for reimbursement. These claims for reimbursement shall be paid within 30 days of being finalized by the department. However, the payment of those amounts that are disputed shall be subject to the requirements, timeframes, and procedures specified in Section 14171. Scope changes going forward shall be finalized within 90 days of receipt and paid within 30 days of being finalized by the department.

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