​​​​​​​​​​​​​​​​​​​​​​​​​​​​Public Freestanding Non-Hospital-Based Clinics Supplemental Reimbursement Program

PFNC Program Overview

California Welfare and Institutions (W&I) Code §14105.965, enacted on August 2006, authorized the PFNC supplemental reimbursement program. This voluntary Certified Public Expenditure (CPE) based program provides additional funding to eligible governmental entities that provide Clinic services to Medi-Cal beneficiaries. Code of Federal Regulations §433.51 requires that an authorized representative of the contributing public agency certify that the expenditures of the governmental entity meet the eligibility requirements for federal financial participation (FFP).  The Centers for Medicare and Medicaid Services (CMS) approved State Plan Amendment (SPA) 06-016 on August 8, 2012, authorizing the federal share of the supplemental reimbursement payments based on uncompensated costs for Medi-Cal fee-for-service Public Freestanding Non-hospital-based Clinics servicesSPA 16-021 was approved by CMS on December 6, 2016, which makes technical revisions to update the clinic participation criteria in the relevant State Plan pages; specifically, those necessary to reflect hospital authorities that govern selected designated public hospitals.

PFNC Program Eligibility

To be eligible for the program, a PFNC provider must meet the following requirements, as specified in W&I Code §14105.965:

  • Provided services to Medi-Cal beneficiaries (further defined in ​SPA 06-016),
  • Be enrolled as a Medi-Cal provider for the period being claimed, and
  • Be owned or operated by an eligible governmental entity, to include the state, a city, county, city and county, the University of California, health care district organized pursuant to Chapter 1 of Division 23 (commencing with Section 32000) of the Health and Safety Code, or hospital authority described in section 101850 or 101852, et seq. of the Health and Safety Code, as these laws were in effect as of July 1, 2016 (pursuant to SPA 16-021).
  • Effective July 1, 2008, payment rules for State-owned and operated clinics are governed by the provisions set forth in SPA 08-014; therefore, effective July 1, 2008, such clinics are not eligible to receive supplemental reimbursement under the PFNC Program.


The costs claimed under the PFNC Program have not and will not be claimed under any other program to obtain FFP. Providers cannot claim costs under the PFNC Program for any time period in which they are claiming, have claimed, received reimbursement and/or participated in programs approved by the State of California and/or CMS for which these costs have been or will be used to obtain FFP.
Eligible providers who choose to participate in the PFNC Program must also comply with the following:
  • Enter into a Provider Participation Agreement (PPA) with the Department of Health Care Services (DHCS), and
  • Agree to reimburse DHCS for its administrative costs associated with managing the PFNC program.

PFNC Reimbursement

PFNC service providers eligible to participate in this program will receive supplemental reimbursement payments by completing a CMS approved cost report form annually. The supplemental reimbursement payment is based on claiming FFP on expenditures that have been incurred by the public provider and meet the requirements for a CPE. The supplemental reimbursement amount is determined by the methodology approved by CMS in SPA 06-016.

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How to contact us

As a public entity, if you would like to participate in the PFNC Program, or if you have any further questions, send inquiries to: PublicClinics@dhcs.ca.gov.​

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Last modified date: 4/5/2022 4:28 PM