Medi-Cal is taking a page straight out of CMS’s book after a recent announcement that they will soon begin collecting 2018 private payer data in an effort to set future fee schedules below commercial averages.
Assembly Bill 1494 requires the California Department of Health Care Services to base Medi-Cal reimbursement for clinical and laboratory services on an average of the lowest rates private payers offer for similar services. Its intent is to use collected 2018 private payer data to establish a new Medi-Cal fee schedule, effective July 1, 2020.
Essentially, this is the same data CMS began requesting in 2017 under the Protecting Access to Medicare Act (PAMA) in order to establish a single national Clinical Laboratory Fee Schedule.
DHCS limited the use of data to codes that met either of the following two thresholds based on the prior year’s Medi-Cal paid claims data:
- Medi-Cal paid claims volume equal to or greater than 1,000.
- Total Medi-Cal paid amount equal to or greater than $500,000.
A full list of relevant codes may be viewed here.
Fortunately, CMS has already identified providers who are required to submit their private payer data. The thresholds for choosing providers required to submit utilization data are:
- Medi-Cal paid claims volume equal to or greater than 5,000.
- Total Medi-Cal paid amount equal to or greater than $100,000.
A full list of NPIs required to report data may be viewed here.
Those marked for inclusion must submit their CY 2018 third-party payer data to DHCS by no later than June 30, 2018. Instructions for proper submissions may be downloaded here.
In short, DHCS is asking required providers to submit their 10 lowest rates billed for each relevant CPT code after taking into consideration any rebates, discounts or adjustments. If a provider has no units billed or rates for a particular code, they are not required to report anything for that code.
DHCS will only utilize rates that fall between zero and 80 percent of the calculated California specific Medicare rate because Medi-Cal lacks the authority to reimburse above 80 percent of Medicare.
As with PAMA, DHCS intends to collect this data on a three-year cycle, meaning providers won’t be required to report again until 2022.
Please reach out to Vachette directly at 517-486-4262 if you have any questions about this initiative or are seeking guidance on how to correctly report.