24-023m Reminder: PPG Financial Survey Reporting, Filing and Oversight Requirements
Date: 01/05/24
Be sure to file financial statements timely.
As a reminder, Health Net on behalf of Community Health Plan of Imperial Valley monitors and evaluates the financial viability of its delegated and capitated participating providers and maintains adequate procedures to ensure providers' reports and financial information confirm each provider is financially solvent according to section 1300.75.4.5(a)(1) of Title 28 of the California Code of Regulations (CCR). PPGs are required to report and file the following:
- Financial survey quarterly and annual audited statements to the Plan and the Department of Managed Health Care (DMHC)
- Self-initiated corrective actions plans (CAP) when non-compliant with DMHC solvency grading criteria
Financial survey filing
PPGs that assume financial risk on a capitated or fixed periodic payment basis for the cost of health care services rendered to health plan members are required to follow the DMHC financial survey filing requirements (sections 1300.75.4, 1300.75.4.2, 1400.75.4.7, 1300.75.4.8, and 1300.76 of Title 28 of the CCR).
Where to submit:
- PPGs and hospitals must submit these quarterly financial updates and annual audited financial statements to the Financial Oversight Department via email.
- Late filing for financial survey requirements: Health Net is required by the DMHC to follow up on late filing of the financial survey (section 1300.75.4.5 of Title 28 of the CCR). As soon as the PPG files with DMHC, the PPG must immediately submit the confirmation of the filing to the Financial Oversight Department via email.
Filing Types | Requirements | Filing Period | Filing Deadline |
|---|---|---|---|
Quarterly Financial Survey | Submit an electronic quarterly financial survey report to the DMHC and the Plan no later than 45 calendar days following the close of each quarter of its fiscal year. (Note: PPGs with financial statements prepared in the fiscal year submit the most recent quarter.) | Q1 | May 15 |
Q2 | August 15 | ||
Q3 | November 15 | ||
Q4 | February 15 | ||
Annual | Submit an electronic financial survey to the DMHC and the Plan not more than 150 calendar days after the close of PPG's fiscal year determined by the DMHC, and based upon PPG's annual audited financial statement prepared in accordance with generally accepted auditing standards. | Annual | May 31 |
Self-initiated corrective action plans
If a PPG reports deficiencies in any of the six DMHC grading criteria listed below, the PPG must submit a self-initiated CAP proposal in an electronic format to the DMHC and the Plan (section 1300.75.4.8 of Title 28 of the CCR).
The grading criteria are:
- Tangible net equity (TNE): must be positive
- Required tangible net equity: Positive TNE shall be at least equal to the greater of:
A. One percent (1%) of annualized revenues; or,
B. Four percent (4%) of annualized non-capitated medical expenses
- Working capital: must be positive
- Cash-to-claims ratio: 0.75
- Claims timeliness percentage: 95%
- Incurred but not reported (IBNR) methodology, both documented and used in estimation of IBNR liabilities: three months
In addition to maintaining compliance with the DMHC’s grading criteria, PPGs are required to maintain compliance with the Plan’s financial benchmarks as outlined in the Financial Statements section of the provider operations manuals. If PPGs fail to meet these standards, PPGs may be required to submit a CAP within 30 days of the Plan’s request.
PPGs with sub-delegating risk arrangements
PPGs with sub-delegating risk arrangements are required to monitor and evaluate the financial viability of its delegated and capitated participating providers and maintain adequate procedures to ensure providers' reports and financial information confirms each provider is financially solvent according with section 1300.75.4.5(a)(1) of Title 28 of the CCR and with the Plan’s financial benchmark as outlined in the Financial Statements section of the provider operations manuals. When requested by the Plan, PPGs are required to provide copies of their monitoring policies and procedures within 30 days of the Plan’s request.
For more information
Refer to the Financial Statements and Financial Survey Filing Requirements sections of the Health Net provider operations manuals. Provider operations manuals are available electronically in the Provider Library on the Plan’s provider portal > Provider Library under Quick Links, or go directly to provider library. Once on the site, select a line of business, then select Provider Manual under Provider Oversight > Contractual Financial and Administrative Requirements.
Additional Information
Relevant sections of the provider operations manuals have been revised to reflect the information contained in this update as applicable. Provider operations manuals are available electronically in the Provider Library on the provider portal.
Providers are encouraged to access the provider portal for real-time information, including eligibility verification, claims status, prior authorization status, plan summaries, and more.
If you have questions regarding the information contained in this update, contact Community Health Plan of Imperial Valley at 833-236-4141.
This information applies to Participating Physician Groups (PPGs).
This information applies to Medi-Cal in Imperial county.