February 10, 2025
Compliance4U newsletter provides you with insight into the day-to-day functions of the Health Plan’s Compliance Program.
Regulatory Affairs & Communication (RAC)
New Compliance Spotlight Section
We’re introducing a new recurring feature in the Compliance Newsletter, where the Regulatory Affairs & Communications team highlights notable compliance actions in the news. In this first edition, we’re sharing two recent updates from the DMHC. Stay informed and stay compliant!
The California Department of Managed Health Care (DMHC) has taken enforcement action against Anthem Blue Cross, issuing two significant fines totaling $4 million for compliance failures related to health plan member grievances and access to care.
� � November 2024 Fine – $500,000
DMHC charged Anthem Blue Cross a $500,000 fine for failing to provide essential health care services and properly acknowledge member complaints during cancer treatment. As part of the Corrective Action Plan (CAP), Anthem Blue Cross must:
✔ Train staff to identify grievances properly
✔ Improve out-of-network authorization processes
✔ Pay outstanding balances, including interest, to the affected member and providers
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� December 2024 Fine – $3.5 Million
DMHC levied a $3.5 million fine against Anthem Blue Cross for failing to handle member grievances promptly. A review of cases from July 2020 – September 2022 found:
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11,670 late grievance acknowledgment letters, including 447 delayed by more than 51 days and 3,657 never sent
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� 4,049 late resolution letters, with 1,634 mailed more than 51 days late
Anthem Blue Cross has paid the fine and reported implementing improvements to its grievance and appeals process, including enhanced training and procedures to ensure compliance.
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� For more details, read the official press releases here.
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Important takeaways from these enforcement actions:
• The information we report to our regulators in routine reports is important! That information/data needs to be accurate and complete. Any data that demonstrates a Health Plan's non-compliance with a DHCS or DMHC requirement should be flagged to Compliance so that action can be taken to mitigate and/or lessen the Health Plan’s risk.
• Grievances, Appeals, and Utilization Management procedures are critical health plan functions that must adhere to the DHCS and DMHC requirements. This work also impacts Customer Service, where most grievances are received. The Health Plan must maintain administrative capacity and proper procedures/training to ensure our day-to-day operations are compliant with DHCS and DMHC requirements.
What’s going on at the State and Federal levels? To support you in your role and ensure timely awareness of regulatory and contractual requirements changes, RAC attends regulatory calls (DHCS Managed Care Plan Call - MCPC) and other regulatory meetings/calls where key regulatory information is shared.
DHCS hosted the January CalAIM MCP Monthly Meeting
On January 23rd, DHCS conducted the Monthly CalAIM meeting, providing updates on ECM terminology, Community Supports, Transitional Rent, and other key topics. Noteworthy points from this month’s meeting include the introduction of the CalAIM Academy Learning Series, the upcoming update to four Community Supports Services effective July 1st, and the CMS
approval leading to the introduction of Transitional Rent as a new Community Support. This meeting provided essential updates that may interest the Health Plan. For more details, please refer to “2025 January CalAIM Monthly Meeting.”
RAC maintains material from those weekly calls. Check out previous meetings HERE.
All Plan Letters (APLs)
DHCS and DMHC release APLs to communicate changes in federal or state policy or procedure and instruct managed care plans (MCPs) on implementing these changes. RAC analyzes the APLs to ensure compliance with the requirements and to meet timely filing. Draft APLs (denoted by “XXX” indicating that both regulators have not assigned a policy number) are issued by both DHCS and DMHC regularly to solicit feedback from MCPs before they are officially published and become effective. During this period, MCPs can provide feedback or concerns to DHCS and DMHC on upcoming APLs. Here are the APLs that were recently released:
A. DHCS Regulatory Notices
DHCS Draft APL 25-XXX Targeted Provider Rate Increases
This draft APL aims to enhance provider reimbursements and ensure proper implementation. It supports better care delivery, increased provider engagement, and equitable access to healthcare for Medi-Cal beneficiaries. DHCS has shared this draft APL, which will supersede APL 24007, with Health Plan for feedback.
Feedback for this draft APL has been collected and sent to CAHP, LHPC, and DHCS.
DHCS APL 25-001 2024-2025 Medi-Cal Managed Care Health Plan Meds/834 Cutoff and Processing Schedule
Issue Date: January 17, 2025
This annual APL provides plans for the MEDS/834 cutoff and processing schedule for the current year. In addition to this schedule, the APL includes the updated outline of the Health Plan’s 834 responsibilities and the Health Care Options (HCO) Secure Data Exchange Services (SDES) file posting schedule for 2025.
Health Plan is to ensure internal systems and processes are synchronized with the DHCS-established cutoff dates to maintain accurate and timely eligibility data processing.
DHCS APL 25-002 Skilled Nursing Facility Workforce Quality Incentive Program
Issue Date: January 13, 2025
This APL guides the payment and data-sharing process required for the Skilled Nursing Facility (SNF) Workforce and Quality Incentive Program (WQIP) for Rating Periods between January 1, 2023, and December 31, 2026. The SNF WQIP is designed to provide performance-based financial incentives to Medi-Cal managed care plans (MCPs) and skilled nursing facilities (SNFs) to improve California's workforce quality and patient care. This program replaces the previous Quality and Accountability Supplemental Payment (QASP) program and aims to support workforce and quality improvements through directed payments based on performance metrics.
• Eligibility and Payment
o Eligible Facilities: Only qualifying SNFs with Medi-Cal network provider agreements are eligible; certain facility types are excluded (e.g., hospice, pediatric subacute care).
o Qualifying Bed Days: Payments are based on eligible SNF bed days; non-qualifying services (e.g., Medicare-covered days, STP, or hospice beds) are excluded.
• Performance Metrics
o Quality Metrics: Performance is assessed across workforce, clinical, and equity domains based on Medi-Cal Accountability Set (MCAS) measures.
o Data Submission: Health Plan must report accurate data on bed days and quality metrics to DHCS by specified deadlines.
• Data Sharing and Reconciliation
o Data Transparency: Health Plan receives quarterly data from DHCS, must reconcile it with their records, and share summary reports with SNFs.
o Discrepancy Resolution: Health Plan must address SNF-reported data issues promptly and provide detailed claims information when needed.
• Communication and Support
o Provider Engagement: Health Plan must conduct at least two webinars annually to educate SNFs and provide program updates.
o LTSS Liaison Support: Health Plan must designate and train liaisons to assist SNFs with program-related questions and technical support.
• Compliance and Oversight
o Policy Updates: Health Plan must update internal policies and submit them to DHCS within 90 days of the APL’s release.
o Enforcement: Non-compliance may result in corrective action plans (CAPs) or financial penalties imposed by DHCS.
• Key Deadlines
o Payment Timing: Health Plan must ensure payments are issued within 45 days of receiving DHCS exhibits or 30 days of a clean claim.
o Data Deadlines: Health Plan must ensure timely submission of bed day and performance data to DHCS.
DHCS APL 25-003 Establishing Dual Eligible Special Needs Plans by 2026
Issue Date: January 15, 2025
This APL mandates that, by January 1, 2026, Health Plans must operate or affiliate with Dual-Eligible Special Needs Plans (D-SNPs). The goal is to create Medi-Medi Plans, which align enrollment for dual-eligible members into a single integrated plan.
• Health Plan must operate, or be affiliated with, a D-SNP that meets:
o State requirements in the DHCS State Medicaid Agency Contract (SMAC) and D-SNP Policy Guide (Dual Special Needs Plans (D-SNP) Contract and Program Guide)
o Provides an integrated Member and Provider experience
o Meets federal requirements for an Applicable Integrated Plan (AIP) (42 CFR section 422.561)
• The following key federal Medicare requirements apply and will be monitored by DHCS for compliance
o Table 1: Key federal Medicare requirements for AIP D-SNPs to begin operations in 2026:
Medicare Advantage Milestone: Deadline: Notice of Intent to Apply November 11, 2024
MA, Part D, and SNP Application Submission, including Model of Care and Provider Network
MA, Part D, and SNP Application Submission, including Model of Care and Provider Network
D-SNP SMAC Submission
February 2025 (specific date to be published by CMS)
June 2, 2025
Early July 2025 (specific date to be published by CMS)
MA Contract Execution with CMS August 31, 2025
o Table 2: Key state SMAC and D-SNP Policy Guide requirements for EAE D-SNPs to begin operations in 2026 include (not all-inclusive):
State Specific Requirements: Deadline:
Notifying DHCS regarding H contract number November 15, 2024
Model of Care Submission
Notifying DHCS regarding plan benefit package number(s) and service areas
Execution of SMAC
Integrated Member Materials Submission
February 2025
April 2025
June 2025
July and August 2025
Suppose Health Plan fails to successfully complete federal Medicare requirements for AIP D-SNPs in all their Medi-Cal service areas or does not comply with the EAE D-SNP SMAC and Policy Guide provisions. In that case, Health Plan may be subject to DHCS enforcement actions such as corrective action plans (CAPs) or monetary sanctions.
B. DMHC Regulatory Notices
APL 25-001 - Southern California Fires and Enrollees’ Continued Access to Health Care Services
Issue Date: January 9, 2025
Summary: On January 7, 2025, California Governor Gavin Newsom proclaimed a State of Emergency in Los Angeles and Ventura Counties due to the Palisades Fire and windstorm conditions. Per Health and Safety Code section 1368.7, health plans must provide enrollees who have been displaced or whose health may otherwise be affected by a state of emergency with access to medically necessary health care services.
Health Plan submitted a filing with the DMHC a notification informing the Department the APL does not apply to Health Plan, as its service area, counties of San Joaquin, Stanislaus, El Dorado, and Alpine in Northern California, are unaffected by the Southern California Fires. Health Plan requires no further action.
Reminder All Plan Letter (APL) Policy Filing Process
All policies must complete the policy workflow before submission. Policy owners revising their policies for an APL must ensure their department executive approves the policy before submitting it to the Compliance policy team. Compliance will review it upon receipt before submitting it to our CEO for
approval. Once all approvals have been obtained, Compliance will submit the policy to DHCS/DMHC if applicable.
RESPONSIBLE PERSON
Revise Policy According to APL
> Obtain Dept. Executive Approval >
Review Policy Against APL/Review Tool > Obtain CEO Approval > Submit Policy to DHCS/DMHC*
ACTION ITEMS
* DHCS/DMHC review and approval is not required for all policies.
Regulatory Reports
Under our contract with DHCS and in compliance with our Knox-Keene license (DMHC), we must routinely submit reports demonstrating compliance and performance. Below is a list of reports due for submission in the next few weeks. The table includes a hyperlink to the report and the accountable Director and Executive for the report. Check out the list to find out which ones are in your department. Click on the report title for more information.
Provider Directory File & Use 2025-02
ECM/JSON 2025-01
CBAS Waiver 2024-01
274 File 2025-01
MCPDIP 2025-01
Data Certification 2025-01
Post Payment Recovery 2025-01
PIN 2025-01
Encounter Data 2025-01
Consolidated Billing 2025-01
NEMT/NMT 2024-10
DMHC Monthly Financials 2025-01
New Members Mailing Attestation 2025-02
CBAS Contracting Template 2025
Written Summary of QIHEC 2024-Q4
Contract Flagging CY23 Phase 2
Ana Aranda Liz Le
Clarence Rao Victoria Worthy
Pamela Lee Tracy Hitzeman
Clarence Rao Victoria Worthy
Clarence Rao Victoria Worthy
Tamara Hayes Sunny Cooper
Christopher Navarro Michelle Tetreault
Ana Aranda Liz Le
Clarence Rao Victoria Worthy
Clarence Rao Victoria Worthy
Dale Standfill Liz Le
Sue Nakata Lizeth Granados
Vena Ford Evert Hendrix
Helen Bayerian Liz Le
Kathleen Daziel Lakshmi Dhanvanthari
Clarence Rao Victoria Worthy
ECM-CS Q4 2024
Community Health Worker Q4 2024
LTC- SNF Quarterly Reporting Q4 2024
Annual Medi-Cal Managed Care Survey
Quarterly Financials Ending 12.31.2024
CY23 MOT Data SDR
SFY 2024 RDT Discussion Guides
Provider Complaints
Johnathan Yeh Lakshmi Dhanvanthari
Niyati Reddy Liz Le
Johnathan Yeh Lakshmi Dhanvanthari
Aimee Griffin Michelle Tetreault
Somatra Sourng Michelle Tetreault
Christopher Navarro Michelle Tetreault
Christopher Navarro Michelle Tetreault
Provider complaints come to the Health Plan in different forms (e.g., direct call to us or dispute submission to DMHC). While our Provider Services and Claims teams address those coming into us, Compliance is the point of contact for those coming through DMHC. In 2025, Health Plan has received four requests (1 Provider Complaint and 3 additional information requests), disputing 1 claim. In 2024, we received 65 requests (28 Provider Complaints and 39 additional information requests), disputing 56 claims. In addition, each complaint may contain multiple issues that require a response. In 2023, Health Plan received 20 requests (13 Provider Complaints and 7 additional information requests), disputing 28 claims. This is an increase of 115% from 2023 to 2024 for Original Provider Complaints. In 2024, the top complaints are from the following providers:
AmWest Inc. (4), Covenant Living West (4)
Behavioral & Educational Strategies & Training (4) and Riverbend Holdings LLC (6)
Compliance coordinates a cross-functional group to review each complaint we receive. This group investigates the cases (from the original request to claim processing and dispute resolution) and prepares a comprehensive response to the DMHC about the provider’s concerns and the actions taken by us These tables outline the status:
Regulatory Audits
DHCS 2023 Routine Medical and Focused Survey
As a reminder, DHCS conducted a routine and focused 10/30/23 – 11/10/23. The surveys focused on the review period of 10/01/22 – 07/31/23. The Department’s Audits and Investigations Division has issued a notice confirming the acceptance and closure of the Health Plan’s Corrective Action Plans (CAPs) for the Routine survey. This notice signals the official closure of the 2023 DHCS Routine Medical Survey.
Health Plan continues to remediate the findings from the focused survey related to Transportation services. The two (2) findings are:
1. The Plan did not have a process to ensure that door-to-door assistance is provided for all members receiving NEMT services.
2. The Plan did not monitor NEMT provider's no-show rates.
DHCS
2024 Routine Medical Survey
As a reminder, The DHCS conducted a virtual onsite survey of HPSJ, covering the review period from August 1, 2023, to July 31, 2024. This survey aimed to ensure compliance with regulatory standards and quality care. The Preliminary report is estimated to be released to Health Plan in February 2025.
Health Plan staff are actively working to address the nine concerns identified during the closing conference (as previously reported). This effort includes a
thorough assessment involving a root cause analysis, mitigation of procedural gaps, and implementation of necessary changes to ensure full compliance with regulatory requirements.
Concerns raised, such as incorrect application of auth requirements to preventive services, biomarker testing, and PQI timeliness, that may impact patient access to care have been remediated immediately. Documentation for the remediation effort is in progress.
Root cause analyses and remediation efforts on the remaining six (6) concerns are carried out according to our standard corrective action plan procedures. To refresh your memory, here are the identified concerns:
1. Prior authorization requirements were incorrectly applied to preventive services.
2. Prior authorization requirements for cancer biomarker testing for advanced or metastatic stage 3 or 4 cancer were not correctly applied.
3. Notifications to members regarding prior authorization requests were not always provided within the required timeframes due to delays in obtaining out-of-network provider agreements.
4. The appropriate fully translated Notice of Action (NOA) template was not used to inform members of prior authorization denials.
5. The appeal process did not review Medi-Cal provider manual criteria for pharmaceutical requests.
6. The imposition of corrective action plans on one delegate was not reported to the DHCS contract manager within 3 working days.
7. Prior authorization requirements were incorrectly applied to family planning services.
8. Not all clean claims were paid within 30 days of receipt.
9. Potential quality issues were not investigated expeditiously, impacting timely action to improve care quality.
