DHCS Stakeholder News: End-of-Year Message from Director Baass  ​

Dear Partners and Stakeholders,

This has been quite a year for the Department of Health Care Services (DHCS). Through hard work, ingenuity, and engagement with you, we were able to make great strides in improving the way we deliver health care to millions of Californians.

As highlighted below, in 2022 we launched many initiatives to transform Medi-Cal; advance behavioral health; manage Medi-Cal's transition out of the COVID-19 public health emergency (PHE); and enhance our departmental operations to better serve Californians.

We look forward to the opportunities together in 2023 as we continue to build on the vision to provide equitable access to quality health care for Californians.

​Transforming Medi-Cal

California Advancing and Innovating Medi-Cal (CalAIM). We're proud to have received the 2022 Medicaid Innovation Award, presented by the Robert Wood Johnson Foundation and the National Academy for State Health Policy, for our work on promising, emerging initiatives to transform Medi-Cal, specifically CalAIM.

CalAIM is designed to provide Medi-Cal members with more equitable, comprehensive, and person-centered care. Starting in January, we implemented Enhanced Care Management (ECM) for members receiving services from Whole Person Care pilots and Health Homes, and expanded statewide in July for initial target populations, including people experiencing homelessness, high-users of health care, and adults with serious mental illness and/or substance use disorders. ECM meets Medi-Cal members where they are – on the street, in a shelter, in their doctor's office, or at home – with 674 providers enrolled as of June to provide vital care coordination to 68,400 Medi-Cal members with the most complex health care needs.

At the same time, managed care plans (MCPs) rolled out Community Supports, which helped 21,600 Medi-Cal members access, in the first half of this year, 14 unique services to address health-related social needs, offered by 725 providers. We released initial data detailing how Medi-Cal members are accessing ECM and Community Supports services, and we will launch a dashboard in 2023.

We also implemented several financing programs that will help drive our transformation of Medi-Cal, including:

  • Providing Access and Transforming Health (PATH), a five-year, $1.85 billion initiative to build the capacity and infrastructure of on-the-ground partners to successfully participate in the Medi-Cal delivery system as California widely implements ECM, Community Supports, and justice-involved services under CalAIM.
  • Housing and Homelessness Incentive Program to address social drivers of health and health disparities. Medi-Cal MCPs will be able to earn incentive funds for making investments and progress in addressing homelessness and keeping people housed.
  • CalAIM Incentive Payment Program (IPP) to support the implementation and expansion of ECM and Community Supports by incentivizing MCPs to drive delivery system investment in provider capacity and delivery system infrastructure; bridge current silos across physical and behavioral health care service delivery; reduce health disparities and promote health equity; achieve improvements in quality performance; and encourage take-up of Community Supports.​
New 2024 Managed Care Contract. In February, we released a Request for Proposal formally launching the first-ever statewide procurement for our commercial Medi-Cal MCPs to be effective in January 2024. The new contract that goes into effect in 2024 will apply to all our Medi-Cal MCPs—commercial and the local initiatives. This new contract raises the expectations of our plan partners to create more transparency, accountability, equity, quality, and value, which in turn will translate to better health outcomes.

Comprehensive Quality Strategy. Earlier this year we released our Comprehensive Quality Strategy, which takes a more expansive view of quality, beyond access and clinical outcomes, to address multiple drivers of health at the individual and system level. Our goals aim to improve member experience and engage them to inform Medi-Cal policy; intervene upstream to keep families and communities healthy via prevention; provide patient-centered chronic disease management; and provide whole person care for high-risk populations by addressing social drivers of health. Additionally, as part of our quality strategy we've launched our ambitious Bold Goals 50x2025 initiative. 50x2025 will include focused initiatives around children's preventive care, behavioral health integration, and maternity care, focusing particularly on health equity within these areas.

Medi-Cal's Strategy to Support Health and Opportunities for Children and Families. We launched a forward-looking policy agenda for children and families enrolled in Medi-Cal. This Medi-Cal strategy unifies the common threads of existing and new child and family health initiatives, and solidifies DHCS' accountability and oversight of children's services. ​

Reproductive and Maternal Health. Reproductive and maternal health improvements are a critical part of DHCS' transformation of Medi-Cal. DHCS this year reaffirmed coverage of and access to comprehensive reproductive health care, including abortion, for Medi-Cal members, and expanded the postpartum period for eligible individuals from 60 days to 12 months. Starting January 1, 2023, DHCS will add doula services to the list of preventive services covered by Medi-Cal, including emotional and physical support provided during pregnancy, labor, birth, and the postpartum period.

Other Important Achievements. Here are some other important changes we made to Medi-Cal this year:

  • Launched Medi-Cal Rx to standardize the Medi-Cal pharmacy benefit under one statewide delivery system and improve access to pharmacy services with a pharmacy network that includes the vast majority of the state's pharmacies.
  • Introduced the Community Health Worker benefit for preventive services on July 1 for both the Medi-Cal fee-for-service and managed care delivery systems.
  • Increased the Medi-Cal eligibility asset limits to $130,000 per person and $65,000 per additional person to help keep members financially stable.
  • Extended eligibility for full health coverage to people 50 years of age and older, regardless of immigration status, and as enacted by Senate Bill 184 (Chapter 47, Statutes of 2022), beginning on January 1, 2024, individuals aged 26 through 49 will be eligible for full Medi-Cal.
  • Expanded Medi-Cal managed care enrollment to an estimated 325,000 members in 2023 who are dually eligible for Medicare and Medi-Cal. These Medicare Medi-Cal Plans are designed to coordinate benefits and care, medical and home and community-based services, and medical supplies and medications.
  • Reformed the financing of skilled nursing facilities, effective January 1, 2023, to better incentivize and hold facilities accountable for quality patient care and result in the long-term financial viability of facilities in Medi-Cal managed care. We are similarly developing the state's new Alternative Payment Methodology for participating Federally Qualified Health Centers.​

Advancing Behavioral Health

We made numerous investments to significantly expand capacity and address gaps within California's behavioral health continuum.

CalAIM. CalAIM introduced new behavioral health policies to better meet the needs of Medi-Cal members with substance use disorder and mental health conditions, including:

  • Allowed individuals to receive behavioral health services without a diagnosis during the assessment period.
  • Simplified the criteria for specialty mental health services so that children experiencing significant trauma such as homelessness or involvement in the child welfare system are automatically eligible for specialty mental health services.
  • Created a “no wrong door" policy to ensure individuals do not need to disrupt trusted relationships in one system when they need to receive care in another.
  • Received a renewal for the Drug Medi-Cal Organized Delivery System (DMC-ODS), as part of CalAIM, which is being implemented in 37 counties that cover 96 percent of the Medi-Cal population. Policy changes include:
    • Added Peer Support services.
    • Removed limitations on residential treatment.
    • Expanded access to recovery services, including for individuals transitioning from incarceration.
    • Launching DHCS' contingency management pilot program in January 2023, which provides motivational incentives to reduce stimulant use disorders, and implement Medi-Cal covered mobile crisis services in county behavioral health programs.
​California's Master Plan for Kids' Mental Health. In August, Governor Gavin Newsom unveiled California's Master Plan for Kids' Mental Health to ensure all California kids, parents, and communities have increased access to mental health and substance use services. The Children and Youth Behavioral Health Initiative (CYBHI) – approved by the Governor in 2021 – is a key component of the plan. CYBHI is a multiyear, multi-department package of investments totaling $4.7 billion that reimagines the systems that will improve access to behavioral health services for all children and youth in California, regardless of payer. Moreover, it will have significant implications for the Medi-Cal program, which covers 5.4 million children and youth.

Behavioral Health Continuum Infrastructure Program. To expand treatment resources, this year we awarded nearly a billion dollars in Behavioral Health Continuum Infrastructure Program (BHCIP) grant funds through the first four of six rounds of funding, with another $960 million to be awarded in future rounds. For more information on BHCIP grant funding and awards, please see the BHCIP Data Dashboard.

BHCIP represents the largest provision of resources for mental health and substance use disorder infrastructure in the state's history, and an unprecedented opportunity to address historic gaps and make meaningful, sustainable change in California's behavioral health continuum.

Other Important Achievements. Here are other notable DHCS achievements in behavioral health this year:

  • Made telehealth permanent, which helps expand access to behavioral health care.
  • Provided critical support for the Substance Abuse and Mental Health Services Administration 988 suicide and crisis-line website. The website is a one-stop destination that includes a toolkit for partner crisis call centers, state mental health programs, substance use treatment providers, behavioral health systems, and others.
  • Awarded nearly $106 million in federal opioid response grants to increase access to Medication-Assisted Treatment (MAT), reduce unmet treatment need, and reduce opioid and fentanyl overdose-related deaths through prevention, treatment, and recovery activities. These projects focus on populations and places with limited MAT access, including youth, rural areas, and the American Indian and Alaska Native tribal communities.
  • Funded 81 emergency departments through the CalBridge Behavioral Health Navigator Program to expand the emergency department workforce to address the urgent need for behavioral health patient care. ​

Ongoing Response to COVID-19 PHE

Medi-Cal Redeterminations. In March 2020, when the spread of COVID-19 triggered the PHE, the normal Medicaid eligibility process was suspended to ensure coverage for vulnerable individuals. According to a spending package recently passed by Congress and signed into law by President Biden, California would need to resume normal Medicaid eligibility redeterminations by April 1, 2023, which may result in millions of members losing their Medi-Cal coverage, even if the federal PHE has not ended. To mitigate this disruption to so many lives, DHCS launched the Coverage Ambassador program to educate all Medi-Cal members about how best to retain their health coverage. More broadly, all of our partners will play key roles in managing this process to minimize disruption to members.

PHE Unwinding Plan. In May, DHCS released the Medi-Cal COVID-19 PHE Operational Unwinding Plan describing our approach to unwinding or making permanent the temporary flexibilities implemented across the Medi-Cal program during the PHE and also our approach to resuming normal operations following the end of the PHE.

Health Care Workforce Retention Payments. Also, to stabilize and retain California's health care workforce during the PHE, DHCS will issue more than a billion dollars in retention payments to workers in qualifying facilities and clinics during the first quarter of 2023. ​

Enhancing Organizational Operations​

As with so many workplaces, DHCS is a different place now thanks to the commitment, resilience, and innovation of our team acting quickly in response to COVID-19. DHCS is doing business differently and has implemented technology, tools, and training for an optimal, hybrid organization and workforce, including the transition of most employees to telework. We are ensuring that our team members have what they need to continue improving the way we deliver services to millions of Californians.

Further, throughout 2022, our data team supported the analysis and development of new dashboards and data visualizations for telehealth, behavioral health, and long-term support services, among others.​

The Importance of our Partnerships

The Department's mission to provide equitable access to affordable, integrated, high-quality health care is possible only with the engagement and contributions of our partners and stakeholders—all of you. This year we launched the DHCS Tribal Engagement Plan to provide opportunities for Tribal and Indian health representatives to be involved in developing Medi-Cal policies during quarterly meetings.

As we look ahead to 2023, we are excited to complete a statewide listening tour to hear from our partners; launch a Consumer Advisory Committee comprised of Medi-Cal members and family caregivers who will advise DHCS on new ways to improve Medi-Cal; and update our strategic plan to reflect our purpose and priorities.

In conclusion, on behalf of Team DHCS, I want to express our deepest gratitude to you for helping us build a healthy California for all. Wishing you a safe and healthy new year. Look forward to the opportunities together in 2023.

With gratitude,


Last modified date: 12/30/2022 8:45 AM