Demonstration MOU Signed by State and Federal Governments

The Department of Health Care Services (DHCS) and the federal Centers for Medicare and Medicaid Services (CMS) announced March 27, 2013 a signed Duals Demonstration Memorandum of Understanding (MOU) to integrate care for dual eligible beneficiaries as a component of California’s Coordinate Care Initiative (CCI).

Click here for the full text of the MOU, a fact sheet and the Health and Human Services Agency’s official announcement.

The MOU signifies federal approval and also serves as the framework for moving forward with the demonstration that builds on more than two years of effort by committed stakeholders.

This major leap forward to better integrate California’s fragmented service delivery systems from now on will be called the Cal MediConnect program.

Through Cal MediConnect, eligible beneficiaries will have the opportunity to combine all their Medicare and Medi-Cal benefits into one health plan — and receive more coordinated and accountable care. Enrollment is expected to begin no earlier than October 2013.

The MOU reflects the commitment of CMS and DHCS to providing high quality, integrated care to beneficiaries eligible for both Medicaid and Medicare. DHCS appreciates the feedback received over the last two years from advocates, physicians, beneficiaries and other stakeholders.

The MOU contains several changes from the state’s original proposal:

  • Timeline: Enrollment in Cal MediConnect will begin no earlier than October 2013. Beneficiaries would begin receiving notices about their choices and upcoming changes no earlier than July 2013. Previously, the 2012 Budget Act (released in January 2012) assumed the enrollment process in all counties would phase in over a 12-month period beginning in March 2013.
  • Enrollment Strategies: The MOU describes the enrollment strategy for each of the eight counties where the Cal MediConnect program will be implemented: Alameda, Los Angeles, San Bernardino, San Diego, San Mateo, Santa Clara, Orange and Riverside. Specifically, assuming an October 2013 start, San Mateo County enrollment will be completed in January 2014 and Los Angeles County enrollment will happen over 15 months.
  • Stable Enrollment Period: Beneficiaries who enroll in a Cal MediConnect health plan can opt out at anytime; there will be no stable enrollment period. California originally proposed an initial six-month stable enrollment period, during which eligible beneficiaries would have remained in the same health plan.
  • Home and Community Based Service (HCBS) Waivers: California’s HCBS waivers will now remain open. This is a change from the original proposal that called for closing them.
  • Size of the Demonstration:The MOU allows for 456,000 total beneficiaries to be eligible for enrollment into the Cal MediConnect program. This is almost half the size called for in the Governor’s 2012-2013 budget (released in January 2012).
  • Number of Participants in Los Angeles County: The MOU caps the number of beneficiaries who may enroll in Los Angeles County at no more than 200,000. The earlier proposal had no such cap.

Next steps in implementing the Cal MediConnect program include conducting readiness reviews of the selected health plans; finalizing capitation rates, executing three-way contracts between the health plans, CMS and DHCS, pending results of the readiness review; and continuing to develop the operational systems needed for activities like enrollment, monitoring, and evaluation.


  1. Susan Haffley

    The “Stable Enrollment Period” makes the whole project seem meaningless. If enrollees know they can opt out anytime, won’t they do just that – like, after one month on a Managed Care Plan?

    • Speaking as a Medicare provider, this is very good news.

      • aDualEligibleNightmare

        As a Medicare recipient this can actually be a whirlwind of problems of an individual, as a Dual Eligible, like myself, has an existing framework of doctors, who are networked in one system, namely UCLA, and who’s health has improved with those doctors, being forced into a plan that once again pushes them to fragmented care with doctors who don’t care about anything more than getting paid. Been there, done that. Being forced to an HMO like structure by Medicaid (since California loves uniqueness of names of their entitlement programs, Medi-Cal; and, yes I acknowledged it is an entitlement program, but as a Medicare provider you are billing in Medicare approved amounts in a day what I receive in a month) when Medicare still remains primary.

        This ‘managed care’ also does not take into account patients’ current physicians even accepting this new plan. For me, the closest plan is HealthNet, which has not had anything but scathing reviews, and L.A. Care, putting me at a community health center where I can wait a year to get a CT scan read. Yes…a year…my IHSS provider just received his results from a CT last August.

        So with all of this, a Dual Eligible can remain in Medicare, and LOSE MediCal; go with Cal MediDisConnect and LOSE the protections from Medicare, their existing health care, and be forced to substandard carethat is against everything even the Affordable Care Act’s most minimal provisions require.

        Or am I missing something?

  2. Good news meaning that they CAN OPT OUT at any time!

  3. Doris Grayson

    Dual Eligible Enrollees can lose their Day Treatment Programs in a Medicale HMO, so opting-out can be a blessing for some of the mentally disordered.

  4. Kristina Merrick

    I am receiving conflicting information regarding “opting out” is it that simple for the medi-medi just to opt out and then what? Is it like nothing has changed for them and they will not be auto enrolled into a Health Plan? For example San Bernardino Health Plans are IEHP or Molina and my beneificaries are in Big Bear which is a rural area and their Primary Care Physcian is located in Big Bear. They want to keep their Physician, which they could if they enrolled in a Health Plan HMO but then most of their specialist are down the moutain and those specialist are not with any of the Health Plans that they would enroll into. Most of the beneficiaries do not want to change into managed care. Can someone please respond to my inquiry regarding what their true options are.

    • If a dual eligible beneficiary decides to opt out of Cal MediConnect, they would continue with their original Medicare (Fee-For-Service) as it exists today. If a beneficiary opts out, they will not be passively enrolled into a Cal MediConnect plan. The opt out process is, however, only on the Medicare side. Beneficiaries still need to select a Medi-Cal health plan to provide their Medi-Cal services.

      • jongran kim

        what means select a Medi-Cal health plan? Do duo beneficiaries has to select their primary doctor and health plan for their medical benefit?

  5. Nancy Strand

    As a provider should we be actively contracting with the chosen health plans in our area now or should we wait a couple months? We are reluctant about locking ourselves into a reimbursement rate until all is said and done.

    • We would encourage you to begin to have conversations with the health plans in your county if you are interested in becoming part of their networks.

  6. My parent is medicare/med-cal eligible if I opt out their medicare I have to chose a medi-cal HMO and she goes to see her prvt M.D under medicare who pays the 20% of the bill if her medi-cal is locked in an hmo?

Comment on This Item

Your email address will not be published. Required fields are marked *