(a) For purposes of this section, the following definitions apply:

(1) “Eligible provider” means a provider who is eligible for reimbursement of Medi-Cal emergency medical transports pursuant to this section, and who continually meets all of the following requirements during the entirety of any Medi-Cal managed care rating period that this section is implemented:

(A) Provides emergency medical transports to Medi-Cal beneficiaries.

(B) Is enrolled as a Medi-Cal provider for the period being claimed.

(C) Is owned or operated by the state, a city, county, city and county, fire protection district organized pursuant to Part 2.7 (commencing with Section 13800) of Division 12 of the Health and Safety Code, special district organized pursuant to Chapter 1 (commencing with Section 58000) of Division 1 of Title 6 of the Government Code, community services district organized pursuant to Part 1 (commencing with Section 61000) of Division 3 of Title 6 of the Government Code, health care district organized pursuant to Chapter 1 (commencing with Section 32000) of Division 23 of the Health and Safety Code, or a federally recognized Indian tribe.

(2) (A) “Emergency medical transport” means the act of transporting an individual from any point of origin to the nearest medical facility capable of meeting the emergency medical needs of the patient by an ambulance licensed, operated, and equipped in accordance with applicable state or local statutes, ordinances, or regulations that are billed with billing codes A0429 BLS Emergency, A0434 Specialty Care Transport, A0225 Neonatal Emergency Transport, A0427 ALS Emergency, and A0433 ALS2, and any equivalent, predecessor, or successor billing codes, as may be determined by the director.

(B) “Emergency medical transport” shall not include transportation of beneficiaries by passenger car, taxicab, litter van, wheelchair van, or other forms of public or private conveyances, nor shall it include transportation by an air ambulance provider. An “emergency medical transport” does not occur if a transport is not provided following evaluation of a patient.

(3) “Medi-Cal managed care rating period” means a period selected by the department for which the actuarially sound capitation rates are developed and documented in the rate certification that the department submits to the federal Centers for Medicare and Medicaid Services as required by Section 438.7(a) of Title 42 of the Code of Federal Regulations.

(b) (1) Commencing no sooner than July 1, 2021, the department shall implement the Public Provider Intergovernmental Transfer Program (program) pursuant to this section for any Medi-Cal managed care rating period that the department has obtained necessary federal approvals.

(2) Notwithstanding any other law, during the entirety of any Medi-Cal managed care rating period for which the requirements of this section are implemented, in whole or in part, supplemental Medi-Cal reimbursements described in Section 14105.94 shall become inoperative.

(c) To the extent authorized under federal and state law, an eligible provider shall receive increased reimbursement by application of an add-on increase, as determined pursuant to subdivision (d), to the associated Medi-Cal fee-for-service payment schedule for emergency medical transports provided to applicable Medi-Cal beneficiaries.

(d) The department shall develop the statewide add-on increase to be provided under the program as follows:

(1) The department shall determine an initial statewide add-on increase that is based on the most recent audited cost reports of eligible providers available at the time the add-on increase is developed, as determined by the department. In determining the initial statewide add-on increase, the department may make adjustments to account for inflation, trend, or other material changes, as appropriate under federal law and actuarial standards.

(2) The initial statewide add-on increase shall represent the difference between both of the following:

(A) The average reimbursement paid pursuant to the applicable base Medi-Cal fee-for-service payment fee schedule for an emergency medical transport during the time period of the applicable cost-report to an eligible provider, and weighted according to those services provided by all eligible providers during the applicable time period.

(B) The average cost directly associated with providing a Medi-Cal emergency medical transport under the Medi-Cal program by an eligible provider during the time period of the applicable cost-report, as determined based on all eligible providers’ audited cost reports pursuant to paragraph (1), and weighted according to those services provided by all eligible providers during the applicable time period.

(3) For subsequent Medi-Cal managed care rating periods, the department, in consultation with participating eligible providers, and as determined by the department, may adjust periodically the initial statewide add-on increase to account for inflation, trend adjustments, or other material changes, as appropriate under federal law and actuarial standards.

(4) To the extent that the department deems practicable, the department shall set a schedule for determining the statewide add-on increase before the department submits to the federal Centers for Medicare and Medicaid Services actuarially sound Medi-Cal managed care rates for an applicable Medi-Cal managed care rating period pursuant to subdivision (e).

(5) Once the department determines the add-on increase for a Medi-Cal managed care rating period, the add-on increase shall not be modified for that rating period unless the modification is required for purposes of receiving federal approval or claiming federal financial participation for the requirements of this section.

(e) (1) A Medi-Cal managed care health plan shall satisfy its obligation under Section 438.114(c) of Title 42 of the Code of Federal Regulations for emergency medical transport, and shall provide payment to applicable noncontract emergency medical transport providers consistent with Section 1396u-2(b)(2)(D) of Title 42 of the United States Code.

(2) During the entirety of any Medi-Cal managed care rating period that this section is implemented, the amounts a noncontract eligible provider may collect if a Medi-Cal beneficiary received medical assistance other than through enrollment in a Medi-Cal managed care health plan pursuant to Section 1396u-2(b)(2)(D) of Title 42 of the United States Code shall be the resulting Medi-Cal fee-for-service payment schedule amounts after the application of the add-on increase described in this section. During the Medi-Cal managed care rating period that the requirements of this section are implemented, any reimbursement to a noncontract emergency medical transport provider that is not an eligible provider shall be made in accordance with subdivision (b) of Section 14129.3.

(f) The Medi-Cal reimbursement provided by this section shall be distributed exclusively to eligible providers under a payment methodology based on emergency medical transport provided to Medi-Cal beneficiaries by eligible providers on a per-transport basis or other federally permissible basis.

(g) During the entirety of any Medi-Cal managed care rating period that this section is implemented, in whole or in part, the department shall provide appropriate funding to each applicable Medi-Cal managed care plan to account for the add-on increase obligations of these plans pursuant to this section in federally approved risk based capitation rates developed in accordance with Section 14301.1.

(h) (1) For any Medi-Cal managed care rating period that this section is implemented, the nonfederal share, which is associated with the add-on increase as it applies to the Medi-Cal fee-for-service payment schedule and the portion of the risk-based capitation rate to Medi-Cal managed care health plans, may consist of voluntary intergovernmental transfers of funds provided by eligible providers and their affiliated governmental entities or other public entities pursuant to Section 14164, as applicable. Upon providing any intergovernmental transfer of funds, each transferring entity shall certify, in the form and manner specified by the department, that the transferred funds qualify for federal financial participation pursuant to applicable laws relating to the federal Medicaid program. Any intergovernmental transfer of funds made pursuant to this section shall be voluntary for purposes of federal law.

(2) The department shall assess a 10-percent fee on each transfer of public funds to the state pursuant to this subdivision to pay for health care coverage and to reimburse the department for its costs associated with administering the program. Excluding this fee, the department shall not assess a percentage fee in connection with any intergovernmental transfer of funds made pursuant to this subdivision.

(3) The department shall develop and maintain, in consultation with participating eligible providers, a protocol and schedule for funding the nonfederal share of expenditures during a Medi-Cal managed care rating period that this section is implemented using voluntary intergovernmental transfers.

(4) This section does not limit or otherwise alter any existing authority of the department to accept intergovernmental transfers for purposes of funding the nonfederal share of expenditures in the Medi-Cal program.

(i) During the entirety of any Medi-Cal managed care rating period for which this section is implemented, in whole or in part, an eligible provider shall be exempt from the quality assurance fee and add-on increase pursuant to Article 3.91 (commencing with Section 14129).

(j) This section shall cease to be operative on the first day of the Medi-Cal managed care rating period beginning on or after the date the department determines, after consultation with participating eligible providers, that implementation of this section is no longer financially and programmatically supportive of the Medi-Cal program. The department shall make this determination if the projected amount of nonfederal share funds available for an applicable Medi-Cal managed care rating period is insufficient to support implementation of this section in the subject Medi-Cal managed care rating period. The department shall post notice of the determination on its internet website.

(k) The director may modify any process or methodology specified in this section to the extent necessary to comply with state or federal law or regulations, or to secure or maintain federal approval or federal financial participation. If the director determines, after consulting with participating eligible providers, that a modification to the process or methodology is necessary, the director shall execute a declaration stating that this determination has been made and describing the modification. The director shall retain the declaration and provide a copy, within five working days of the execution of the declaration, to the fiscal and appropriate policy committees of the Legislature. The director shall post the declaration on the department’s internet website.

(l) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, or make specific this section, in whole or in part, by means of all-county letters, provider bulletins, plan letters, or other similar instructions without taking regulatory action.

(m) (1) The department shall implement this section only to the extent that federal financial participation is available and any necessary federal approvals are obtained.

(2) The department shall promptly seek any necessary federal approvals for the implementation of this section for an applicable Medi-Cal managed care rating period.

(Added by Stats. 2019, Ch. 544, Sec. 2. (AB 1705) Effective January 1, 2020. Section inoperative as prescribed by its own conditions.)