AB 160: Medi-Cal managed care organization provider tax.

Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Under existing law, one of the methods by which Medi-Cal services are provided is pursuant to contracts with various types of managed care plans.

Existing law imposes a managed care organization (MCO) provider tax, administered and assessed by the department, on licensed health care service plans and managed care plans contracted with the department. Under existing law, all revenues, less refunds, derived from the MCO provider tax are available to the department, upon appropriation, for the purpose of funding specified subcomponents to support the Medi-Cal program. Existing law sets forth certain taxing tiers and tax amounts, and sets the Medi-Cal per enrollee tax amount for Medi-Cal taxing tier II, as defined, at $205 for the 2024, 2025, and 2026 calendar years.

This bill would raise the MCO provider tax amount for that tier to $274 for all 3 of those calendar years.

The bill would also reappropriate specified funds from the Budget Act of 2023 related to the State Department of Health Care Services.

This bill would include a change in state statute that would result in a taxpayer paying a higher tax within the meaning of Section 3 of Article XIIIA of the California Constitution, and thus would require for passage the approval of ²/₃ of the membership of each house of the Legislature.

This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.