24-1284 Average Contract Rate Must Include Inflation Adjustment (Assembly Bill 72)

Date: 12/19/24

As a reminder, effective January 1, 2024, the California Department of Managed Health Care (DMHC) amended section 1300.71.31 of title 28 of the California Code of Regulations (Rule 1300.71.31), as described in the DMHC All Plan Letter (APL) 24-001.

DMHC updated Rule 1300.71.31 to include an inflation adjustment requirement when calculating the reimbursement rate for non-contracted providers providing non-emergency services in a contracted facility (Assembly Bill 72, Bonta 2016), which is the greater of the average contracted rate (ACR) for the service or 125% of what Medicare reimburses for the service. 

Participating physician groups (PPGs) that are delegated and that have risk for relevant services are responsible for ensuring that the ACR they use incorporates an inflation adjustment, as described in APL 24-001. 

Additional information

Access APL 24-001 (PDF).

If you have questions regarding the information contained in this update, contact the Health Net Provider Services Center by email, by telephone or through the Health Net provider portal.
 

This information applies to Participating Physician Groups (PPGs).