Robert Chavez, MD
President, IEPC

Providence Little Company of Mary Medical Center Torrance

Here is my pearl for this month:

Check with your network Payors overseen by DMHC to see if they have given your rates their annual inflation rate updates.

A. In late 2023 applying to 2024, DMHC finalized regulations adding annual inflation rate adjustments to the interim payment methodology required by California’s out of network billing and payment law AB 72, 2016.
B. This law requires payors to reimburse at a default reimbursement rate, with an opportunity for physicians to challenge the rate through California IDR Process.
C. The current DMHC default reimbursement rate is based on the greater of the payor’s average contracted rate of 125% of Medicare for the same or similar services in the geographic region where the services are rendered.
D. This law amended reqwuirement went into effect on 1/1/2024. As a result, you could potentially receive a 6% increase in reimbursement (3% inflation per year over the last 2 years.)
E. Ask your RCM company to look and see if any of your rates are affected by this adjustment to existing law.
F. Ask your RCM company to reach out to the payors covered to see if they have increased your rates.

You may or may not receive a reply, but it never hurts to ask. If you get a chance, please take a moment to thank CMA for this potential rate increase. It was made possible through their state advocacy efforts.