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Health and Human Services Agency (HHSA) recommending the Board approve and authorize the Chair to sign the Extended Letter of Agreement (LOA) 9907 with Mountain Valley Health Plan (MVHP), also known as the Health Plan of San Joaquin (HSPJ), which continues the terms and rates of Medi-Cal reimbursement for authorized medically necessary services to MVHP/HPSJ members, for the one-year period effective January 1, 2026, through December 31, 2026, with the option to extend the term of the LOA for up to two additional one-year terms after the initial term through December 31, 2028, while a final master agreement is in development between HHSA and MVHP.
FUNDING: 100% Federal Medi-Cal.
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DISCUSSION / BACKGROUND:
California’s Medi-Cal program, the largest state Medicaid program in the U.S., insures roughly one-third of the state's residents, providing vital health coverage for low-income children, adults, and people with disabilities. The San Joaquin County Health Commission (Commission), a multi-county commission, contracts with the California Department of Health Care Services (DHCS) to provide a managed care health plan to Medi-Cal covered individuals. Through this managed health care plan, referred to as the Health Plan of San Joaquin (HPSJ) Two-Plan Medi-Cal Managed Care Plan Model, the Commission has successfully improved health care access for its members and increased reimbursement rates for health care providers.
The HPSJ is a non-profit Health Maintenance Organization (HMO) Managed Care Plan (MCP) that collaborates with the Medi-Cal Managed Care Division of the DHCS to deliver healthcare to Medi-Cal members and has been providing healthcare services to the Central Valley community for over two decades.
On June 6, 2023, the Board approved the execution of a Letter of Intent between HHSA and the HPSJ which expressed the parties’ mutual intent to negotiate and develop a formalized Medi-Cal Services Agreement to provide Medi-Cal covered services to HPSJ members in El Dorado and Alpine counties effective January 1, 2024. As set forth by the DHCS, the parties needed to subsequently enter into a formalized agreement for the Medi-Cal covered services and was to be based upon a contract template provided by DHCS (Legistar file 23-0924).
On December 5, 2023, due to several issues with the DHCS contract template for the Medi-Cal services not aligning with the current scope of preventive services provided by HHSA’s Public Health Department and HPSJ, the Board approved and authorized the Chair to sign an Extended Letter of Agreement (LOA) with HPSJ, which sets forth the rates of reimbursement for authorized medically necessary Medi-Cal services to HPSJ members for a six-month period from January 1, 2024, through June 30, 2024 (Legistar file 23-1915). This Extended LOA intended to satisfy DHCS requirements for the 2024 required timeline, until the final agreement can be approved by all parties. On June 25, 2024, the Board approved and authorized the Chair to extend the LOA for an additional six-months from July 1, 2024, through December 31, 2024, to ensure the continuity of Medi-Cal covered services to HPSJ members (Legistar file 24-1034). On December 3, 2024, the Board approved and authorized the Chair to extend the LOA a second time for an additional year for the effective period of January 1, 2025, through December 31, 2025. The Extended LOA, while not constituting a formal contract between the County and HPSJ, enabled ongoing collaboration and progress toward a long-term agreement in line with DHCS evolving statewide Medi-Cal Managed Care framework.
It is important to note that while the Extended LOA is only with MVHP/HPSJ, the permanent contract being negotiated not only includes MVHP/HPSJ, but also the County’s two other local MCPs, Kaiser Foundation Health Plan and Anthem Blue Cross of California, as parties to the agreement. The three MCPs and HHSA Public Health staff have been working closely together to develop their framework for data sharing and service coordination requirements to be included in the agreement, which specifies coordination and actions across all interfaced public health programs (except the Women’s, Infant and Children’s Program which is being developed through a separate agreement). While this contract has been in development since early 2024, due to the varying needs between the Public Health programs and the three MCPs, there have been numerous revisions to this contract, all of which has required multiple iterations of staff, MCP, and all parties’ legal departments’ reviews, and at times additional review by DHCS. The DHCS template, given that it was a statewide template and highly customizable has required significant tailoring to meet department and MCP needs and has resulted in multiple delays to finalizing a contract that is approved by all parties and DHCS.
This agenda item presents a request for the Board to approve a renewal of the Extended LOA, this time covering the one-year period from January 1, 2026, to December 31, 2026, with the option to extend the term for up to two additional one-year terms after the initial term through December 31, 2028. This LOA does not constitute an executed contract between the County and HPSJ, however enables the County to continue development of the long-term MCP agreement in alignment with the evolving scope and structure of local health jurisdiction participation in DHCS statewide Medi-Cal Managed Care implementation. This extension will continue to outline medical services and reimbursement rates for authorized medically necessary services to MVHP/HPSJ members. HHSA recommends the Board approve this Extended LOA to ensure continuity of the provision of medically necessary Medi-Cal eligible services while the master agreement between HHSA Public Health and the three MCPs is being finalized.
ALTERNATIVES:
Should the Board decline to approve this recommendation, the County could forfeit the opportunity to partner with the Health Plan of San Joaquin as the offered public plan of the Two Plan Medi-Cal Managed Care Model to improve health services for County Medi-Cal members.
PRIOR BOARD ACTION:
1) 06/06/23, 23-0924, Health Plan of San Joaquin Letter of Intent
2) 12/05/23, 23-1915, HHSA HPSJ Extension Letter of Agreement
3) 06/25/24, 24-1034, HHSA HPSJ/MVHP Extended LOA 7/1/24-12/31/24
4) 12/03/24, 24-1785, HHSA HSPJ/MVHP Extended Letter of Agreement (1/1/25-12/31/25)
OTHER DEPARTMENT / AGENCY INVOLVEMENT:
County Counsel
CAO RECOMMENDATION:
Approve as recommended.
FINANCIAL IMPACT:
There is no General Fund Cost associated with this agenda item. The covered medical services are reimbursed through 100% Medi-Cal.
CLERK OF THE BOARD FOLLOW UP ACTIONS:
Clerk of the Board to obtain signature of Chair on one Extended Letter of Agreement 9907.
STRATEGIC PLAN COMPONENT:
N/A
CONTACT:
Olivia Byron-Cooper, MPH, Director, Health and Human Services Agency