Federal Government Approves Healthy Families Transition – With Conditions

The federal government has approved a request from the state to eliminate the Healthy Families Program, an insurance program for children of working families, and transition almost 900,000 children to Medi-Cal over the course of 2013.  This transition was approved last year as a means of saving the state $73 million dollars (and it saves the federal government money as well since Medi-Cal rates are lower than Healthy Families rates).

Since this policy was first proposed, the transition has drawn criticism from advocates concerned that children could suffer from disruptions to care or face challenges in accessing the care they need.  These worries have been sharpened by the very serious problems faced by seniors and persons with disabilities as they transitioned from fee-for-service Medi-Cal to Medi-Cal managed care: more than 20,000 of these fragile Californians were denied access to their doctors. Despite concerns raised about the speed and the magnitude of the Healthy Families transition, the state charged forward and received approval from the federal  Centers for Medicare & Medicaid Services (CMS) in a letter dated December 31, 2012.  The transition of children will move forward in four phases, with over 197,000 children transitioned on January 1, 2013.

We were gratified that CMS’ approval is contingent on several conditions that protect the children that will be impacted.

First, CMS is implementing an ongoing monitoring and evaluation process for each phase.  The monitoring plan If the monitoring data indicates there are problems or if CMS is not pleased with the evaluation results from one phase, they will not allow the state to move forward with implementation of the next phase.  That is, subsequent phases of the transition will each require written CMS approval.  The federal government will be looking closely at whether the state is successfully providing coverage to children; this includes meeting network adequacy standards and ensuring continuity of care.

Secondly, the federal government will be partnering with the state in stakeholder engagement efforts, including listening sessions, throughout the transition.

Additionally, CMS is requiring that the state conduct beneficiary surveys so that they can hear directly from those families who are affected by the transition. The beneficiary surveys will help the state ensure transitioned children have adequate access to medical, dental, specialty care, mental health, and substance abuse services, as well as overall family experiences with the transition.

The Legislature has also held several oversight hearings already and we anticipate that there will be more as the transition progresses.

This transition will, upon its completion, add nearly 900,000 children in the Medi-Cal system – this is an opportunity for the state to look at ways to strengthen and improve the Medi-Cal program, and by extension the health care system on which we all rely.  The federal health reform law, the Affordable Care Act, provides some new resources, like a primary care provider rate increase, to help improve Medi-Cal at this crucial time. There is much more that California can do in the new year to make Medi-Cal a better program for current and new enrollees, with a firmer foundation for an improved health system.

You can read the Healthy Families transition background and approval documents in full here: http://www.dhcs.ca.gov/services/hf/Pages/HFPBridgeReform.aspx.

For more information about the changes that beneficiaries should expect to see, the 100% Campaign has developed a fact sheet available in several languages:

Health Access California promotes quality, affordable health care for all Californians.