Access for Infants and Mothers (AIM):  CenCal Health also maintains an exclusive contract with the State of California to administer the Access for Infants and Mothers (AIM) program in Santa Barbara County -- a program that provides medical services to women during their pregnancy and for the first 60 days after pregnancy. These women may register newborns to obtain their medical coverage under the Healthy Families Program. The AIM program is designed for those who do not have health insurance but do not qualify for Medi-Cal, and is paid for through State tobacco taxes and subscriber contributions. The CenCal Health program is called "Prenatal PLUS 2".

Healthy Families:  In addition, CenCal Health is one of the participating health plans in both Santa Barbara and San Luis Obispo counties offering residents health coverage for children under the Healthy Families program -- California's version of the Federal Children's Health Initiative (S-Chip) Again, this is a program that provides medical coverage for those who do not have health insurance but cannot qualify for the Medi-Cal program.

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II. POWERS OF CENCAL HEALTH UNDER STATE LAW
CenCal Health contracts with the State of California to arrange for, but not directly provide, health care benefits to the eligible program populations in Santa Barbara and San Luis Obispo counties, in exchange for a per capita reimbursement (i.e. at-risk). In turn, CenCal Health is empowered to contract for health services and negotiate rates with providers, administer the programs locally, process claims, and assure access to covered services for eligible members and subscribers residing in Santa Barbara and San Luis Obispo counties. For Medi-Cal, eligibility is determined by the County Social Services Department or by the Federal Social Security Administration, according to State and Federal standards. Independent contractors to the State determine eligibility for the AIM and Healthy Families programs. CenCal Health is advised monthly of eligible members via secure data transmittals.

CenCal Health is at-risk for arranging and paying for those covered health care benefits that are not specifically excluded under its contracts with the State. Annual revenues from its contracts approximate $256 million. Certain benefits under the Medi-Cal program are not covered through CenCal Health and remain available to members through the State Fee-for-Service Medi-Cal program.

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III. GOVERNANCE OF CENCAL HEALTH
CenCal Health (as the Santa Barbara Regional Health Authority) was formally established October 18, 1982, at which time it became independent of County government in Santa Barbara. Effective March 1, 2008, CenCal Health commenced services for the Medi-Cal program in San Luis Obispo County.  Essentially, the only relationship with either County government is that the Santa Barbara and San Luis Obispo County Boards of Supervisors appoint CenCal Health's 13-member Board. All policy is set by the Board of Directors, which is composed of health providers, government officials, and other community and consumer representatives. The Board is responsible for disbursement of all funds targeted to meet the health care needs of an average of 85,000 eligibles across the three programs in Santa Barbara and San Luis Obispo counties.

The Board is assisted in its efforts in governing the program by various advisory committees. As a public entity, the process of obtaining input from its constituents is one of the central features of CenCal Health. This process ensures open meeting debate on all issues of importance and guarantees that the agency is accountable to the communities it serves. The committees' activities include, but are not limited to: developing and implementing CenCal Health's Quality Assessment and Improvement Plan, reviewing quality of care concerns and corrective action plans, proposing resolution for provider complaints, reviewing provider's credentialing and re-credentialing files and recommending to the Board of Director's their participation in the network, and reviewing and recommending to the Board of Directors additions and deletions to CenCal Health's Formulary.

Community Advisory Board (CAB) On November 24, 1982, the Board established a Community Advisory Board ("CAB") to review and comment on proposed policies and actions of the board dealing with the arrangements for health care within the jurisdiction of CenCal Health. The CAB participates in establishing the public policy of CenCal Health. The Board has approved the CAB mission, goals and membership guidelines.

The CAB provides a forum for CenCal Health's members, their representatives, and community agencies to discuss common issues of interest and importance. In addition, the CAB provides member input into CenCal Health's quality improvement process. The committee has the following functions:

• Review, on a quarterly basis, complaints received, and make recommendations for quality improvement
• Review and provide input regarding Member Rights and Responsibilities and various member communication materials
• Make recommendations regarding Member Services Quality Improvement Activities (e.g. Member Satisfaction Survey)
• Review and provide input regarding community outreach activities

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IV. MORE ON CENCAL HEALTH  PROGRAM ELIGIBILITY
Medi-Cal:  Those individuals who qualify for Medi-Cal and are residents of Santa Barbara and San Luis Obispo counties are automatically inscribed into the Medi-Cal program - with a few minor exceptions. Unlike most Medicaid managed care plans, CenCal Health accepts the risk for the full Medi-Cal population, which includes both cash assistance eligibles and those eligible through the SSI program (including the aged, blind, and disabled). Medi-Cal membership includes "crossover" members (i.e., those persons with both Medi-Cal and Medicare coverage).

The State issues Medi-Cal members a Benefits Identification Card (BIC), which provides basic member information. In addition, Medi-Cal members receive a CenCal Health Identification card which gives the member's PCP's name and telephone number. Neither card alone serves as evidence of Medi-Cal eligibility; providers must check on a monthly basis to determine continued eligibility.

AIM:  On January 1, 1993, CenCal Health entered into its first contract with the California Managed Risk Medical Insurance Board (MRMIB) as a participating health plan to serve subscribers of the Access for Infants and Mothers (AIM) program in Santa Barbara County. The AIM program covers pregnant women who have no health insurance for their pregnancy, who are not eligible for Medi-Cal, and whose annual family income is between 200% and 300% of the federal poverty level. These women are covered during pregnancy and the first sixty days after delivery. AIM subscribers pay a small portion of the cost of coverage (2% of the total family income), and the remainder is provided by MRMIB through tobacco tax funds. Since 1995, CenCal Health has held an exclusive contract with MRMIB for AIM subscribers. CenCal Health's program is called "Prenatal PLUS 2".

Healthy Families:  In March, 1998, MRMIB awarded CenCal Health "community provider" designation in Santa Barbara County for the Healthy Families program. CenCal Health was granted this status due to its proven ability to contract with all of the designated "safety net" providers in the County. This State and federally subsidized program offers benefits to subscribers ages one to 19 who are not eligible for no-cost Medi-Cal, and do not have other health insurance coverage. Applicants pay monthly premiums, in addition to co-payments for specified services. Subscribers choosing CenCal Health's program, known as "Healthy Families through CenCal Health", pay lower premiums due to the community provider designation. In 2006, CenCal Health began participating as a Healthy Families plan in San Luis Obispo County.

Healthy Kids:  In 2005, CenCal Health began administration of separate Healthy Kids programs in Santa Barbara and San Luis Obispo counties. Healthy Kids programs are locally-sponsored health care programs, funded by a combination of public and private contributions, that provide health coverage to children that do not qualify for neither the Medi-Cal nor Healthy Families programs. The Healthy Kids benefit and premium packages are identical to the Health Families program. The Healthy Kids programs in both Santa Barbara and San Luis Obispo counties each have locally organized non-profit corporations that raise funding and set policy for the programs.

IHSS Workers Program:  Also in 2005, CenCal Health began providing health coverage to individuals that provide personal care assistance to disabled individuals through a contract with the Santa Barbara County Public Authority. CenCal Health provides comprehensive health coverage to these care givers based upon eligibility criteria set by the County Public Authority.

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V. OBJECTIVES OF CENCAL HEALTH
The objectives of CenCal Health in all its programs are to:

CenCal Health has a system for the review of the quality of health care to identify, evaluate, and remedy problems relating to access, continuity and quality of care, and utilization. CenCal Health's Quality Assessment and Improvement Program ("QAIP") provides a description of the operation of the review system. The purpose of the QAIP is to continuously improve the quality of care and services provided by CenCal Health and its contracted provider network.

Through its QAIP, CenCal Health continues to refine its methods for assuring access to care for its members and subscribers, to keep pace with current trends in the managed care sector, to develop programs for improvement in disease management, to focus on quality studies and measures, to assure provider qualifications meet participation standards through a credentialing program, and to emphasize Medi-Cal physician incentive rewards that are based on quality measures as opposed to simple reduction of utilization. In June 2000, CenCal Health  was awarded a Knox-Keene Health Care Service Plan license by the State Department of Managed Health Care for its Healthy Families program. This license was subsequently modified to include the AIM program as well as the Healthy Kids program.

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VI. PROVIDER PARTICIPATION
CenCal Health works with all interested health care providers in Santa Barbara and San Luis Obispo counties to provide Medi-Cal services. This is central to CenCal Health's philosophy to be a provider-inclusive program, rather than restricting members to a small number of exclusive contractors. However, in order to be paid, providers must execute a written contract with CenCal Health. PCPs and specialists may contract with CenCal Health either individually, in groups, or as outpatient clinic providers. Formal groups of primary care and specialty physicians may choose to contract with CenCal Health as a single contracting entity. In addition, CenCal Health contracts with out-of-county providers as needed to assure specialized services to its members/subscribers.

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VII. CASE MANAGEMENT BY PCPs
Primary Care Network  The central feature of CenCal Health's programs is the utilization of a primary care network. Under this approach, the majority of members/subscribers residing in the County are required to choose a PCP, who then serves as a case manager for the patient. Members/subscribers may choose a general practitioner, family physician, pediatrician, internist, or an obstetrician/gynecologist to coordinate their care and provide referrals to specialty services. To participate as a pediatric PCP for Medi-Cal, Healthy Families, and AIM members/subscribers under 20 years of age providers must additionally provide proof of valid Child Health and Disability Prevention Program (CHDP) certification. PCPs may take as few as 50 patients, or, for large groups or clinics, up to a maximum of 2,000.

Case Management and Utilization Management  In order to ensure that members/subscribers receive necessary care, utilization of services are closely monitored and controlled by the PCP as well as by CenCal Health. Generally, most health services are coordinated by the PCP. With the exception of true emergencies and a few other exceptions, all levels and types of covered health services are rendered either by the PCP or by other providers with the PCP's authorization. Normally, the most common medical conditions can be treated by the PCP. Specialty referrals, hospitalizations, lab, and X-ray must be authorized, in a timely manner, by the PCP or by a designated back-up physician. These authorizations, either on Referral Authorization Forms (RAFs) or on Treatment Authorization Requests (TARs), are required for reimbursement by CenCal Health. CenCal Health's Medi-Cal or Health Initiative program is consistent with the benefit limitations and restrictions applicable to the Statewide Medi-Cal program, which include prior authorization for TAR-designated procedures. This control and authorization function is central to the "Case Management" concept of primary care networks, and aids in reduction of duplicative utilization or unnecessary treatments, and ultimately in controlling costs.

CenCal Health's Information Technology (IT) Department prepares monthly Medi-Cal status reports for PCPs, which present information on various utilization and quality measures. Such reports permit the physician or group provider to monitor performance and alter practice patterns as necessary.

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VIII. PHYSICIAN and MEMBER/SUBSCRIBER RELATIONSHIP
Member Selection of PCPs  Each member and subscriber is given the opportunity to choose a PCP from a list of available PCPs who will agree to act as his/her case manager. It is important to stress that members/subscribers have freedom of choice in selecting their PCP. The member/subscriber is responsible for contacting their PCP for all care, and the physician is responsible for arranging needed care for the member/subscriber.

Resolving Grievances  CenCal Health has established a grievance system with procedures which work to protect both members/subscribers and providers. Should there be failure to establish a good physician-patient relationship, members/subscribers and providers may request that a change be made. Of course, members/subscribers and providers may have other specific reasons to file appeals or complaints, i.e. appeal of a TAR decision.

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IX. FLOW OF FUNDS
The State's payment to CenCal Health is based on a monthly per capita calculation. These rates are renegotiated annually. The State pays to CenCal Health a sum each month based on the number of eligible members in each program. For Medi-Cal, the per capita rates are based on Medi-Cal aid code categories.

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X. PROVIDER PAYMENT METHODS
Reimbursement to PCPs (For Case-Managed Members/Subscribers) Each month, Medi-Cal PCPs are paid 80 percent of the primary care capitation, based on the number of members, and their aid codes and age/sex. This "guaranteed payment" is the physician's "pre-paid" compensation for providing primary care services and for accepting case management responsibilities. The payment is made regardless of whether the Medi-Cal members assigned to the PCP actually use services that month. Medi-Cal PCPs also participate in an incentive payment system, which is described later. PCPs for CenCal Health's other programs are paid at that specific program's fee-for-service rate.

Reimbursement to Referral Physicians (For All Members/Subscribers) Those specialty (referral) physicians who have contracts with CenCal Health have the choice of accepting or rejecting referrals made to them by PCPs. Reimbursement for most specialists for Medi-Cal is based on prevailing or a percentage increase of Medi-Cal fee-for-service rates, although some at-risk contracts or special rates are used when needed to assure access. Rates under CenCal Health's other programs are generally higher than Medi-Cal rates. Specialty care rendered to case managed members/subscribers requires written authorization from the PCP for reimbursement by CenCal Health

Reimbursement to Hospitals (For All Members/Subscribers) Hospitals in both Santa Barbara and San Luis Obispo counties participate by signing contracts with CenCal Health.  Payments are made to hospitals by CenCal Health only for services rendered to eligible members/subscribers who, other than true emergencies or noted exceptions, are authorized by the PCP and/or CenCal Health.

Reimbursement to Long-Term Care Institutions (For all Members/Subscribers) CenCal Health's benefit package includes reimbursement for Long Term Care services.

Reimbursement to Pharmacies and Other Providers (For All Members/Subscribers) Payment is made for drugs covered under the CenCal Health Formulary, which has expanded the coverage beyond what the State allows.

Reimbursement to Providers of Limited Services (For All Medi-Cal Members) Certain providers may render services to Medi-Cal members without the authorization of the PCP, subject to the existing Medi-Cal service visit limitations. These providers include chiropractors, acupuncturists, and certain therapists.

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XI. MEDI-CAL PCP INCENTIVE (pay for performance) PROGRAM
Quality and Utilization Performance-Based System  The purpose of the incentive program for Primary Care Physicians (PCPs) is to improve quality of care, increase members' access to that care, and control costs through appropriate utilization of medical services. PCPs receive financial incentives based on their performance relative to their peers who share the same provider type (e.g. pediatrics, internal medicine, etc.) for established utilization and quality measures.

Quality measures reward PCPs for increasing access to by encouraging acceptance of new patients and rewarding after hours care. Quality measures also reward PCPs for increasing case management quality by ensuring patients receive preventive medicine evaluations and access appropriate services in the primary care setting. The higher the performance percentage in the preventative medicine, encounters, after-hour visits, and increased access categories the better.

Utilization measures encourage appropriate control by PCPs of referrals, pharmaceuticals, outpatient services, and inpatient admissions. The lower the performance percentage in physician/outpatient expenses, hospital inpatient expenses, pharmacy expenses, and emergency department visits the better. 

A pool, or potential amount that a PCP can earn, is based on the number of members assigned to that PCP and the number of months the PCP case manages those members.  It includes a case mix adjustment using members' age, sex, special case, and Medi-Cal aid code. This pool amount is funded partially by the PCP through a 20% capitation withhold and then additionally by contributions by CenCal Health. The total pool amount is split between utilization (45%) and quality (55%) and further divided into the eight measures described above.

A PCP's actual payment for each measure is based on their performance relative to an average performace for PCPs in the same peer pool. CenCal Health makes incentive payments in two installments; an initial payout of 25% of a PCP's estimated total incentive payment immediately after the close of the incentive year (i.e., calendar year) and the remaining balance in June.  This allows PCPs ample time, up to six months, to submit claims and encounter data before final incentive payments are made.

During an incentives year, PCPs receive monthly progress reports to track their performance. 

Currently, the incentive program is administered at the contracted provider level, which may consist of a practice including one sole practitioner or multiple physicians within a clinic. This means progress reports, pool sizes, and payouts may be detailed and physicians are compared to their peers.

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XII. CLAIMS PROCESSING/REPORTING OF SERVICES
CenCal Health staff perform in-house processing and adjudication of claims and payment to providers for authorized services rendered to its members. Staff is available to assist and train provider staffs, answer questions, and resolve claim and/or payment problems in a timely fashion. This arrangement has been successful in assisting providers in billing, simplifying submission procedures, and reducing the time between claim submission and receipt of payment. Accurate data submitted by providers on the claims forms provides the basis of CenCal Health's reporting of Healthcare Effectiveness Data and Information Set (HEDIS) measures to regulatory agencies requesting reports on quality.

Primary care services rendered by a SBHI PCP are considered to be "encounters", as such services are covered by the monthly capitation payment. Such encounters are reported once each month on claim forms or on special encounter forms.

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XIII. INFORMATION TECHNOLOGY
CenCal Health has since its inception dedicated resources to the development of a progressive information system -- one that would encourage provider participation, and provide health professionals and plan management with the ability to monitor utilization and quality measures. The system also permits electronic submission of claims (approximately 69% of all claims are now submitted to CenCal Health in this fashion). In addition, CenCal Health's IT Department has developed a unique automated eligibility verification system, through its website for its provider network to immediately determine eligibility status, PCP information, each member's unique preventive care needs, and other important data about the patient. This system has been expanded to provide a mechanism for full secure networking with providers, with functions to include on-line claims submission.

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XIV. CONCLUSION
Through many years of experience, CenCal Health has developed a managed care system that is responsive to both the member/subscriber and the provider. It has demonstrated that a capitated system of payment can be financially viable to PCPs; administrative and medical costs can be managed effectively without denying patients necessary medical attention and care; and a local, responsive and publicly managed plan can ensure widespread participation of providers and ensure access to quality care.

CenCal Health refines and revises its policies and procedures to ensure that the program remains effective and efficient in the constantly changing health care environment. It gladly shares the lessons it has learned with those charting a similar course in the management of health care, and looks to continue its tradition of innovation for years to come.

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