Inland Empire Health Plan (IEHP) and L.A. Care Health Plan, two of California’s largest publicly-operated Medi-Cal managed health plans, recently announced efforts to provide financial support to hospitals and health systems during the COVID-19 pandemic.
In preparation for a potential surge of COVID-19 hospitalizations, California hospitals preserved their bed capacity and were called upon to increase existing capacity by 40-50 percent through the cancelation and/or postponement of non-emergent procedures. This action created significant financial pressure on provider organizations, drastically reducing revenues at a time when expenses for personal protective equipment and supplies increased -- and are in short supply.
To strengthen their contracted hospitals’ abilities to respond to the COVID-19 pandemic, IEHP is amending its contracts to include a capitation feature that will pay a facility the hospital’s expected net patient revenue for IEHP Medi-Cal members or their monthly claims’ average for calendar year 2019, whichever is greater.
IEHP is expecting to provide more than $90 million in support to providers during their pandemic response efforts, IEHP said in a news release.