Considering Medi-Cal in the Midst of a Changing Fiscal and Policy Landscape

Oct 24, 2025 - Most hospitals get more money back from this arrangement than they pay in fees. That said, some hospitals, particularly those that primarily provide care to non ‑Medi ‑Cal patients, incur net costs as a result of the fee program.
https://lao.ca.gov/Publications/Report/5083

The 2025-26 Budget: MCO Tax and Proposition 35

Feb 26, 2025 - Such an approach is likely inefficient and arbitrary, as plans that pay considerably more for services (arguably already providing a more adequate payment) get the same boost in rates as a plan with notably lower payment s.
https://lao.ca.gov/Publications/Report/4992

The 2026-27 Budget: Department of Developmental Services

Mar 13, 2026 - The goals of individual consumers can vary widely and span from short to long term. Such goals could include living in an apartment, getting and maintaining a job, and participating in music or art classes.
https://lao.ca.gov/Publications/Report/5157

The 2026-27 Budget: Medi-Cal Analysis

Mar 2, 2026 - Federal rules include an overall limit on how much revenue provider taxes can generate. California historically has set its provider taxes and fees well below this revenue limit. In recent years, however, California pursued notably larger taxes, getting much closer to the federal limit.
https://lao.ca.gov/Publications/Report/5146

The 2025-26 Budget: Overview of the Governor's Budget

Jan 13, 2025 - The reason for the reduction is the recent voter approval of Proposition  35 (2024), which requires the state to spend less MCO tax money on offsetting General Fund spending and more money on provider rate increases.
https://lao.ca.gov/Publications/Report/4951

The 2024-25 Budget: The MCO Tax Package at May Revision

May 22, 2024 - Using the tax in this way allowed the state to spend less money from the General Fund on Medi-Cal. When the Legislature notably increased the tax in 2023, however, it designated some of the associated revenue to increase funding for Medi-Cal and other health programs.
https://lao.ca.gov/Publications/Report/4905

The 2025-26 Budget: Medi-Cal Pharmacy Spending

Apr 3, 2025 - Savings From Negotiated Rebates. After paying pharmacies for the drugs, Medi ‑Cal submits claims to drug makers for negotiated rebates. These rebates provide money back to the Medi ‑Cal program, effectively helping to offset some of the cost of the drugs.
https://lao.ca.gov/Publications/Report/5026

The 2026-27 Budget: Medi-Cal Fiscal Outlook

Nov 19, 2025 - Were California to qualify, the two ‑year extension could shift the associated savings from disenrollments over a longer period of time. How Large of an Effect Will State and Federal Policy Changes Have?
https://lao.ca.gov/Publications/Report/5092

The 2025-26 Budget: Medi-Cal Fiscal Outlook

Nov 20, 2024 - This is because the measure requires the state to use more MCO tax money to increase Medi-Cal services, rather than to offset General Fund spending. The exact fiscal impact depends on how the state implements the measure ’s complex rules.
https://lao.ca.gov/Publications/Report/4941

The 2021-22 Budget: Initial Comments on the Governor’s May Revision

May 17, 2021 - The Legislature can use excess revenues in three ways: (1)  appropriate more money for purposes excluded from the SAL (under the Governor ’s proposal, the common new spending for this purpose is capital outlay), (2)  split the excess between additional school and community college district spending and taxpayer rebates, or (3)  lower tax revenues.
https://lao.ca.gov/Publications/Report/4432