Today's Law As Amended

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AB-537 Medi-Cal managed care: quality improvement and value-based financial incentive program.(2019-2020)



SECTION 1.

 Section 14310.1 is added to the Welfare and Institutions Code, to read:

14310.1.
 (a) (1) The department shall establish a quality assessment and performance improvement program for the Medi-Cal managed care program.
(2) Commencing January 1, 2022, and pursuant to the quality assessment and performance improvement program, a Medi-Cal managed care plan shall meet a minimum performance level (MPL) that improves the quality of health care and reduces health disparities for enrollees.
(3) To ensure that a Medi-Cal managed care plan achieves compliance with the MPL, the department may require the Medi-Cal managed care plan to complete and submit to the department a corrective action plan, and impose sanctions.
(4) For purposes of paragraph (2), “health disparities” means variations in disease occurrence, including communicable diseases, and health outcomes between population groups by geographic area, primary language, race, ethnicity, sex, age, sexual orientation, gender identity, and disability status.
(b) As part of designing and establishing the MPL, the department shall consult with stakeholders, as described in subdivision (j), and shall consider all of the following:
(1) The median performance of Medicaid plans nationwide for measures established in subdivision (d), which are measured and reported in states other than California.
(2) Any variations in the performance of Medi-Cal managed care plans in California as compared to performance of Medicaid plans nationwide.
(3) The median performance of health care plans regulated by the Department of Managed Health Care and the Department of Insurance for measures established pursuant to subdivision (d) with consideration of regional variation.
(4) Sufficient scientific evidence and research indicating the appropriate MPL to improve quality and reduce health disparities.
(5) Requirements that may be established by the federal Centers for Medicare and Medicaid Services (CMS), the federal Health Resources and Services Administration, and the federal Centers for Disease Control and Prevention (CDC).
(6) The quality assessment and performance levels established by other state purchasers, including the California Health Benefit Exchange and the California Public Employees’ Retirement System, taking into consideration regional variation, as may be appropriate.
(c) Commencing July 1, 2022, the department shall establish quality improvement performance targets for Medi-Cal managed care plans that improve quality of care and reduce health disparities for enrollees. The performance targets shall exceed the MPL identified by the department and shall be based on national benchmarks, analysis of variation in California performance, best existing science of quality improvement, and effective engagement of stakeholders. A Medi-Cal managed care plan that meets performance targets may receive financial incentive payments if a value-based financial incentive program is implemented pursuant to subdivision (i).
(d) The department shall establish the measures to be applied to the MPL and performance targets, and, commencing July 1, 2020, shall require each Medi-Cal managed care plan to annually collect these measures.
(1) The department shall establish measures that include both of the following:
(A) The External Accountability Set (EAS), which includes, but is not limited to, the Healthcare Effectiveness Data and Information Set and the Consumer Assessment of Healthcare Providers and Systems (CAHPS).
(B) The CAHPS supplemental questions pertaining to cultural competency and health literacy.
(2) The department shall develop the measures through the stakeholder process, as established pursuant to subdivision (j), and shall consider the ability of the measures to demonstrate a Medi-Cal managed care plan’s performance in reducing health disparities.
(3) The measures shall be collected in a manner that allows an analysis of the measures by county, primary language, race, ethnicity, sex, age, sexual orientation, gender identity, and disability status. Sexual orientation and gender identity analysis shall be provided only to the extent that sexual orientation and gender identity are collected and statistically reliable data is available.
(4) The measures shall take into account, as may be appropriate, quality assessment and performance measures utilized by other state purchasers, including the California Health Benefit Exchange and California Public Employees’ Retirement System.
(e) By January 1, 2022, the department shall provide validated translations of the CAHPS survey in all Medi-Cal threshold languages.
(f) By January 1, 2023, the department shall require an external quality review organization to administer the surveys annually in each county in all Medi-Cal threshold languages in that county.
(g) A Medi-Cal managed care plan that is accredited by the National Committee for Quality Assurance (NCQA) may submit to the external quality review organization, CAHPS, survey data collected annually as part of the plan’s NCQA accreditation. The department shall accept this data if CAHPS determines that the survey data is collected annually and meets the requirements of the quality review.
(h) To inform development of the MPL, as described in paragraph (2) of subdivision (a), and the measures, as described in subdivision (d), each Medi-Cal managed care plan shall produce baseline data relating to the measures in the existing EAS, stratified by county, or by region if the Medi-Cal managed care plan cannot stratify data without disclosing personally identifiable information, primary language, race, ethnicity, sex, age, sexual orientation, gender identity, and disability status.
(i) (1) The department shall develop, in consultation with the stakeholders described in subdivision (j), a plan for a value-based financial incentive program to reward a high-performing Medi-Cal managed care plan that meets performance targets that demonstrate quality improvement of health care and a reduction in health disparities for enrollees, as described in paragraph (2) of subdivision (a).
(2) To the extent that additional funding is required to implement a value-based financial incentive program, the department shall submit the plan to the Legislature for review, and the implementation of this plan shall be subject to an express appropriation of funds for that purpose in the annual Budget Act.
(3) This subdivision does not preclude the department from either developing or implementing a value-based financial incentive program that does not require any additional appropriation of funds.
(j) (1) The department shall establish a public stakeholder process in the planning, development, and ongoing oversight of the quality assessment and performance improvement program, as described in subdivision (a), and the value-based financial incentive program, as described in subdivision (i).
(2) The stakeholder process shall provide stakeholders with an opportunity to provide meaningful input related to the establishment of the MPL, the selection of measures that Medi-Cal managed care plans must meet, and the design of the value-based financial incentive program.
(3) The stakeholders shall, at a minimum, include consumer advocates, public health experts, health care providers, and representatives from the Medi-Cal managed care plans. The department shall consult with other state purchasers, including the California Health Benefit Exchange, to discuss alignment of quality measures across payers when appropriate.
(4) Notwithstanding the Bagley-Keene Open Meeting Act (Article 9 (Commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code), the department shall convene the stakeholders no less than quarterly until a majority of the stakeholders agree that quarterly meetings are no longer necessary. Materials for those meetings shall be posted on the department’s internet website 24 hours in advance of the meetings. Information about the meeting’s time and place shall be sent to all interested members of the public no later than one week prior to the meeting. Stakeholder meetings shall be open to the public either in person or over the telephone.
(k) The department shall annually and publicly report the results of the quality assessment and performance improvement program on the department’s internet website. The report shall identify disparities in quality of care provided to Medi-Cal managed care enrollees and shall include an analysis of performance measures established in subdivision (d), by Medi-Cal managed care plan, county, or region if unable to be produced without personally identifiable information, primary language, race, ethnicity, sex, age, sexual orientation, gender identity, and disability status.
(l) Each Medi-Cal managed care contract entered into or amended on or after January 1, 2020, shall include a definition of “health disparities” consistent with paragraph (4) of subdivision (a).
(m) (1) The department shall utilize the results of the quality assessment and performance improvement program to develop a publicly reported Quality Rating System for Medi-Cal managed care plans, subject to federal approval.
(2) In developing the Quality Rating System, the department shall consult with stakeholders, including Medi-Cal managed care plans and enrollees, to provide feedback to the department on topics that include the selection of data domains, survey methodology, rate calculation methodology, public display so that it is accessible to all members, including enrollees who are limited-English proficient and persons with disabilities, dissemination, and rules regarding marketing of results.
(n) (1) This section does not require the department to report data that would result in statistically unreliable information nor to disclose personally identifiable information.
(2) This section does not require the department to establish requirements mandated by this section based solely on data that is determined to be statistically unreliable.
(o) For purposes of this section, “Medi-Cal managed care plan” means an individual, organization, or entity that enters into a contract with the department to provide general health care services to enrolled Medi-Cal beneficiaries, including any of the following:
(1) Article 2.7 (commencing with Section 14087.3) of Chapter 7, excluding dental managed care programs developed pursuant to Section 14087.46.
(2) Article 2.8 (commencing with Section 14087.5) of Chapter 7.
(3) Article 2.81 (commencing with Section 14087.96) of Chapter 7.
(4)  Article 2.82 (commencing with Section 14087.98) of Chapter 7.
(5) Article 2.91 (commencing with Section 14089) of Chapter 7.
(6) Chapter 3 (commencing with Section 101675) of Part 4 of Division 101 of the Health and Safety Code.