14105.468. (Added by Stats. 2024, Ch. 40, Sec. 61.)

(a) (1) Beginning for dates of service on or after January 1, 2025, the department shall establish and implement a directed payment program under which a qualifying nonhospital 340B community clinic may earn payments from contracted Medi-Cal managed care plans, subject to an appropriation by the Legislature.

(2) (A) Beginning for dates of service on or after January 1, 2026, the department shall increase the amount of directed payments pursuant to paragraph (1) with amounts allocated from the Medi-Cal Provider Payment Reserve Fund in accordance with Section 14105.200.

(B) If the voters approve the addition of Chapter 7.5 (commencing with Section 14199.100) to this part at the November 5, 2024, statewide general election, this paragraph shall be inoperative as of January 1, 2025.

(b) The department, in consultation with affected stakeholders, and affected Medi-Cal managed care plans, as applicable, shall establish the methodology or methodologies, parameters, and eligibility criteria for the directed payments pursuant to this section. This shall include, but is not limited to, the milestones and metrics that a qualifying nonhospital 340B community clinic shall meet in order to receive a directed payment from a Medi-Cal managed care plan pursuant to this section. The department may implement the directed payment described in this subdivision using one or more of the models authorized by subsection (c) of Section 438.6 of Title 42 of the Code of Federal Regulations.

(c) To the extent permissible under federal law, directed payments received by qualifying nonhospital 340B community clinics pursuant to this section shall be considered separate and apart from the prospective payment system (PPS) reimbursement the clinic receives pursuant to subsection (bb) of Section 1396a of Title 42 of the United States Code and shall not be considered during annual reconciliation of the PPS rate.

(d) 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, plan letters, provider bulletins, information notices, or other similar instructions, without taking any further regulatory action.

(e) The department shall seek any federal approvals it deems necessary to implement this section. This section shall be implemented only to the extent that any necessary federal approvals are obtained and federal financial participation is available and is not otherwise jeopardized.

(f) For any calendar year in which this section is implemented, in whole or in part, and notwithstanding any other law, neither the department nor a Medi-Cal managed care plan shall be required to make the payments specified in Section 14105.467.

(g) For purposes of this section:

(1) “340B” means the discount drug purchasing program described in Section 256b of Title 42 of the United States Code.

(2) “Qualifying nonhospital 340B community clinic” means a center or clinic that is licensed under subdivision (a) of Section 1204 of the Health and Safety Code, or a clinic operated by a city, county, city and county, or hospital authority that is exempt from licensure under subdivision (b) of Section 1206 of the Health and Safety Code, and that is a 340B covered entity pursuant to Section 256b of Title 42 of the United States Code for the duration of each applicable fiscal year for which the department implements this section.