Record Fines Might Mean California Is Finally Serious About Improving Medi-Cal

Is California getting more durable on well being plans that take part in Medi-Cal, the state’s insurance coverage program for low-income residents?

Just a few weeks in the past, state regulators imposed a record $55 million in fines on L.A. Care, California’s largest Medi-Cal managed-care plan, for failing to make sure enough care and permitting remedy delays that threatened enrollees’ well being. Affected person advocates hope the transfer alerts stricter enforcement towards different Medi-Cal insurers, which have lots of the similar shortcomings for which the regulators simply fined L.A. Care.

Twenty-five managed-care plans throughout the state present look after nearly 12 million of the greater than 14 million Californians enrolled in Medi-Cal, and the state is commonly accused of failing to carry the plans accountable for subpar care. Medi-Cal members are among the many state’s most susceptible individuals: They’ll face language and cultural boundaries and have disproportionately excessive charges of continual sickness.

The state Division of Well being Care Providers, which runs Medi-Cal, is drafting a brand new managed-care contract, scheduled to take impact in 2024, that officers say will enhance care by holding collaborating well being plans to larger requirements. The state hopes to scale back well being disparities and enhance well being outcomes by tightening surveillance and enforcement.

“They’re making an attempt to do extra, and that’s actually optimistic,” says Abbi Coursolle, senior lawyer on the National Health Law Program in Los Angeles. “Clearly, they’ve much more to do.”

DHCS and the state Division of Managed Well being Care, which additionally regulates Medi-Cal managed-care plans, launched coordinated investigations of L.A. Care, based mostly partly on a 2020 Los Angeles Times report that highlighted lengthy, typically lethal, delays in care at services run by the Los Angeles County Division of Well being Providers. That company operates the county’s public safety-net system and contracts with L.A. Care to offer look after a whole bunch of hundreds of the well being plan’s members. Of their investigations, state regulators additionally relied on info that L.A. Care reported to them.

That they relied on these sources, Coursolle says, raises questions concerning the effectiveness of its personal surveillance and auditing.

On March 4, the Division of Managed Well being Care hit L.A. Care with a $35 million penalty — greater than triple its highest earlier fantastic. The Division of Well being Care Providers levied $20 million, practically eight occasions its earlier document.

The state cited L.A. Look after greater than 100,000 violations, together with late responses to affected person complaints and appeals, delayed or denied authorizations for needed medical care, and failure to make sure the county well being companies company complied with affected person care rules. The California Division of Public Well being, which regulates hospitals and different well being care establishments, didn’t reply to a query about whether or not it’s investigating any of the county’s medical services.

In asserting the fines, state company administrators stated: “The magnitude of L.A. Care’s violations, which has resulted in hurt to its members, requires speedy motion.” The well being plan has 2.4 million Medi-Cal enrollees.

“The latest enforcement motion towards L.A. Care alerts that DHCS intends to train our authorities to guard our Medi-Cal enrollees,” division spokesperson Anthony Cava advised me in an e-mail.

L.A. Care’s CEO, John Baackes, says the plan is just not contesting the findings. “What we’re contesting is the quantity of the fines, which we imagine are unreasonable,” Baackes stated. The dispute might take months, and even years, to settle.

In an announcement launched after the fines have been introduced, L.A. Care famous Medi-Cal’s notoriously low funds to suppliers and stated the penalties create “one more monetary hurdle for a public well being plan that could be a essential a part of the well being care security web.”

Though L.A. Care has generated thousands and thousands of {dollars} in earnings lately, it reported a loss of $132 million in fiscal 12 months 2020. However the plan can climate the fines. On the finish of final 12 months, its tangible web fairness — a key measure of solvency — was seven times as excessive because the minimal required by legislation.

The violations described by regulators are painfully acquainted to Theresa Grant, a Culver Metropolis resident I wrote about late final 12 months who has struggled to find relief from a debilitating ache in her rib cage. The violations are “horrific,” she says, “and I feel it’s very true.”

However she believes the specialist physicians who’ve been unable or unwilling to assist her deserve a giant share of the blame. “You know the way lengthy I’ve been coping with my downside,” she advised me. “It’s been over a 12 months now, and never a rattling factor is being executed.”

Regardless of the numerous penalties levied on L.A. Care, client advocates and a few state lawmakers assume California wants the authority to levy even bigger ones.

A invoice sponsored by the patron advocacy group Health Access would improve lots of the fines that state well being plan regulators can impose no less than tenfold. Supporters say the laws, SB 858, is required as a result of the quantity the division can legally levy on well being plans hasn’t been raised in some circumstances since 1975.

“We wish to guarantee that insurance coverage corporations don’t view these fines as simply the price of doing enterprise,” says the invoice’s writer, state Sen. Scott Wiener (D-San Francisco). “By elevating them, they change into much less a value of enterprise and extra an precise incentive to observe the legislation.”

The fines imposed on L.A. Care are outliers due to their dimension, which was decided partly by the sheer variety of violations. “For each fantastic like that, there are various which can be dramatically decrease,” Wiener says. “I wouldn’t wish to depend on one case and say, ‘Oh, no downside, as a result of they bought a giant fantastic.’”

One other vital consider holding well being plans’ ft to the fireplace, Wiener says, is client complaints, which may also help carry issues to the eye of regulators — and to the plans themselves.

However a report last year by KFF confirmed that client appeals of denied care are exceedingly uncommon.

You probably have an issue together with your well being plan or wish to enchantment a delay or denial of protection, a very good place to start out is the Division of Managed Well being Care (888-466-2219 or

The state additionally has an ombudsman for Medi-Cal managed care (888-452-8609 or [email protected]).

You may as well attempt the Well being Shopper Alliance (888-804-3536 or, which assists individuals in private and non-private well being plans. It gives free recommendation, supplies authorized companies, and may also help you get your paperwork to ensure that an enchantment.

Regulators and well being plans alike often say they’re engaged on behalf of the affected person. So when you’re not getting the care you want, rise up and be a part of the answer.

KHN (Kaiser Well being Information) is a nationwide newsroom that produces in-depth journalism about well being points. Along with Coverage Evaluation and Polling, KHN is likely one of the three main working applications at KFF (Kaiser Household Basis). KFF is an endowed nonprofit group offering info on well being points to the nation.


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