Legislation to Authorize Statewide Kaiser Medi-Cal Contract Advances with Amendments, Concerns Remain
June 23, 2022
This week, the Senate Health Committee voted to advance AB 2724 (Arambula), which would authorize the Department of Health Care Services (DHCS) to enter into a direct statewide contract with Kaiser Permanente to provide care for certain Medi-Cal beneficiaries. The bill would codify the budget proposal brought forward by Governor Newsom’s administration earlier this year.
CSAC, along with a long list of local health plans and community health centers, oppose AB 2724 due to concerns that this new contract would exempt Kaiser from the locally organized health care safety net and terminate input and oversight for Kaiser operation within each county. Currently, counties have multiple structures for ensuring health care access, including County Organized Health Systems (COHS) and two-plan models. Each model is led by the county or a county subsidiary tasked with ensuring access to quality health care for all low-income residents.
Prior to the bill’s passage from the Senate Health Committee, AB 2724 was amended in an attempt to address concerns around equity and safety net providers. Importantly, the recent amendments clarify that the new contract would be limited to areas where Kaiser already has a commercial presence to ensure Kaiser does not rely on safety net providers instead of Kaiser providers. Additionally, AB 2742 was amended to require Kaiser to periodically consult with counties and local health plans in the regions Kaiser operates.
While the recent amendments are an appreciated improvement, CSAC remains concerned about the impact AB 2742 will have on counties’ ability to ensure access to quality care for California’s most vulnerable residents. CSAC will continue to advocate for local oversight and the preservation of the locally organized health care safety net as the bill advances to the Senate Appropriations Committee.