CSAC Bulletin Article

MCO Fix: A Work in Progress

February 19. 2016

The Brown Administration continues to make progress on the Managed Care Organization (MCO) fix, reaching a deal with the developmental disabilities services community this week.

Ensuring that the developmental community receives additional funding has long been on the Special Session on Health Care to-do list, with legislators from both sides of the aisle insisting on a boost in funding.

The deal would provide developmental services workers, which includes those who work at the state’s regional centers and community- and home-based service providers, with their first wage increase in more than 10 years.

Costs are estimated at between $280 million and $400 million, but it is not clear how much of that is actual state general fund, as well as whether these costs would be exclusively funded with new MCO fix revenues. Details of the deal have not yet been released.

Now, with health plans and the business community on board with the Governor’s MCO fix proposal (SBX2 15/ABX2 20) and a developmental services deal, the Brown Administration will turn their attention to the Legislature.

Assembly Republicans have reportedly made a series of additional demands on the expected MCO fix revenue, including boosting the rates paid to Med-Cal providers. The Governor may balk at this, since his plan is estimated to bring in about $1.3 billion dollars, and he needs at least $1.1 billion to continue to fund current Medi-Cal services. Anything beyond the developmental services deal could potentially be a general fund ask.

All parties are working to resolve the MCO fix, but a special session vote on the Governor’s proposal may not be in the near future. CSAC will continue to provide updates as information becomes available.

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