California counties in stalemate with state over mental health coverage

Sacramento and Solano counties in California are in a current dispute with the state over mental health coverage for Medicaid beneficiaries, CapRadio reported March 16. 

The state is requiring the counties to begin managing and providing mental healthcare for Medi-Cal beneficiaries with severe mental illness enrolled in Oakland, Calif.-based Kaiser Permanente plans. The other 56 counties in California currently work this way, according to the publication. 

The two counties have refused, saying a lack of funding makes taking on these patients infeasible and will lead to a disruption of care for the nearly 50,000 specialty mental healthcare patients in the counties. 

California is offering an additional $11.6 million per year to Sacramento and $7.7 million a year to Solano, funds that would be taken from revenue other counties in the state use for behavioral health treatment costs, according to CapRadio.

Sacramento wants $36 million per year and Solano is seeking $17 million per year. 

The state is threatening penalties and potential termination of mental health contracts with the counties if they do not agree. 

Under California law, counties must provide care for Medi-Cal patients with severe mental illness. Until recently, the state had an agreement with Sacramento and Solano counties where it would pay Kaiser Permanente for all mental healthcare for Medi-Cal beneficiaries. That agreement has now been dissolved and will require 7,000 patients with severe mental illness to move out of Kaiser's network, according to the publication. 

California state health officials are pushing for the shift in management in order to streamline the state's mental health system before implementing its new CalAIM initiative, which would reform the Medi-Cal program.

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