California health centers have asked Gov. Gavin Newsom to delay the transfer of Medicaid managed care drug benefits to Medicaid fee for service until next year.

Calif. Health Centers Ask Newsom to Delay Medi-Cal Drug Benefit Shift Until 2022

California health centers asked Gov. Gavin Newsom (D) on Friday to delay implementing his controversial transfer of Medicaid drug benefits from managed care to fee for service until January 2022, to let health centers “focus on the needs of their communities in the midst of this pandemic.” The switch is expected to cost 340B providers hundreds of millions of dollars in lost revenues on 340B drugs billed to Medi-Cal. Under Medi-Cal fee for service, providers must bill for 340B-purchased drugs at actual acquisition cost plus a dispensing fee. Under Medi-Cal managed care, they can bill at higher contracted rates.

Newsom’s order originally was scheduled to take effect on Jan. 1. The state health department in November pushed that back to April 1 due to “the ongoing challenges and constantly evolving health care landscape associated with the unprecedented COVID-19 public health emergency.”

California health centers asked Gov. Gavin Newsom (D) on Friday to delay implementing his controversial transfer of Medicaid drug benefits from managed care to fee for service until January 2022, to let health centers “focus on the needs of their communities in the midst of this pandemic.”

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