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The 2020-21 Budget: Re-Envisioning Medi-Cal—The CalAIM Proposal

The Legislative Analyst’s Office has just published the following report:

The 2020-21 Budget: Re-Envisioning Medi-Cal—The CalAIM Proposal

In this report, we provide an overview and assessment of the Governor’s California Advancing and Innovating Medi-Cal (CalAIM) proposal, also known as Medi-Cal Healthier California for All. (We note that when our report was prepared, many aspects of the proposal were still under development. Ongoing workgroup discussions are likely to affect the details of the overall proposal while it is under legislative consideration.)

CalAIM would make far-reaching reforms to Medi-Cal that would increase the program’s focus on its high-cost and high-needs enrollee populations, transform and streamline Medi-Cal managed care, extend components of a current federal waiver, and rethink how behavioral health services are financed and delivered. Overall, CalAIM’s conceptual approach is promising, and the reforms could bring benefits to Medi-Cal beneficiaries, the state, and the state’s implementing partners.

At the same time, the proposal raises many questions and presents risks. A key question for legislative focus is whether Medi-Cal managed care plans are ready to become newly responsible for a broad array of services that local governments typically provide. In addition, whether the proposal would be cost-effective within Medi-Cal is unclear.

Finally, the ultimate effectiveness of aspects of the reform proposal could hinge, to some extent, on decisions outside of the Legislature’s control—specifically, choices by managed care plans and the availability of community resources, such as housing. Addressing key questions and planning for potential risks is critical as the Legislature moves forward with consideration of the CalAIM proposal.

This report is available using the following link: https://lao.ca.gov/Publications/Report/4185

This article was released by the California Legislative Analyst’s Office.