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Payments to Medi-Cal Prohibited Entities

Provider Type

  • Physicians
  • Participating Physician Groups (PPG)
  • Hospitals
  • Ancillary

As of July 4, 2025, the use of federal Medicaid funds is temporarily restricted for certain providers identified as Prohibited Entities. These restrictions apply for one year and affect both direct and indirect payments.

Additionally, the Federal District Court issued two separate Preliminary Injunctions (PIs) that modified the Temporary Restraining Order (TRO) originally issued on July 7, 2025:

  • July 21, 2025: A PI was issued but did not extend relief to California providers.
  • July 28, 2025: A second PI granted relief to all Planned Parenthood affiliates in California.

Prohibited Entities

A provider may be classified as a Prohibited Entity if they meet all of the following criteria:

  • Operate as a nonprofit focused on family planning or reproductive health.
  • Provide abortion services, except in cases of rape, incest, or life-threatening conditions.
  • Received over $800,000 in Medicaid payments during fiscal year 2023.

Permitted activities

All Medi-Cal and Family Planning, Access, Care, and Treatment (PACT) providers, including those affected by H.R. 1, may continue to:

  • Assist patients with Presumptive Eligibility for Pregnant People (PE4PP) and Family PACT enrollment.
  • Accept eligible patients.
  • Deliver services under current Medi-Cal rules, including the prohibition on billing patients directly.

Claims and payment guidance

For providers with PI Relief

Continue submitting claims for all services rendered on or after July 4, 2025.

For providers without PI relief

Continue to submit claims only for abortion-related services. Claims must:

  • Be submitted separately from other services.
  • Include only abortion-related services and directly related ancillary care.
  • Be reimbursed by State General Funds and are not impacted by H.R. 1.

Additional guidance

  • Providers delegated for claims processing may continue processing claims for services rendered on or before July 3, 2025, for all providers, including Prohibited Entities.
  • Providers delegated for claims processing may continue processing claims for providers with PI relief for services rendered on or after July 4, 2025, until further court instruction.
  • Providers not classified as Prohibited Entities may continue submitting claims as usual.

Last Updated: 08/27/2025