California’s Department of Health Care Services imposed a $2.5 million fine for noncompliance.
California’s Department of Health Care Services recently notified Kaiser Permanente of its intent to impose sanctions totaling more than $2.5 million for noncompliance with data reporting requirements. The fines include $1,792,500 for failing to submit physician administered drugs (PADs) data, and an additional $742,500 for failing to submit encounter data as required by Medi-Cal, the state’s Medicaid program.
According to California Healthline, this is the first fine imposed against a California Medicaid managed care plan since at least 2000. Sarah Brooks, deputy director of healthcare delivery systems at the Department of Health Care Services says, “This is the first time the department has sanctioned a health plan in recent history. The amount is significant. We do take it very seriously.”
“Kaiser was unable to submit all of the required encounter data,” California Department of Health Services Jennifer Kent said in a Jan. 13 letter to Kaiser. “Additional penalties relating to this deficiency may be imposed from October 2016 until Kaiser’s encounter data deficiencies are corrected.”
The company has stated it will not appeal the sanctions and is “working towards compliance.” Apparently, their computer systems were not designed to facilitate compliance with California’s reporting requirements, according to Nathaniel Oubre, Kaiser Permanente’s Medi-Cal vice president. “We are taking steps to change this,” he says. “We are making investments in technology that will facilitate compliance with the state’s data reporting requirements.”
Kaiser has invested more than $400 million in data systems over the past 10 years according to Internet Health Management, and it is one of 22 health payer organizations administering Medicaid programs as part of Medi-Cal. Further fines are possible if the California Department of Health Services determines Kaiser’s violations put the agency in noncompliance with federal rules.
Brooks told California Healthline that next year the state will be implementing a new ratings system for all Medi-Cal managed care plans next year to track the quality of patient care, appeals processes, contract compliance, and other performance measures.