Centers for Medicare & Medicaid Announces Extensions of CalAIM to Support Greater Health Equity Across Communities

BALTIMORE, Maryland, Dec. 29 -- The U.S. Department of Health and Human Services' Centers for Medicare and Medicaid Services issued the following news release:

The Centers for Medicare & Medicaid Services (CMS) approved the California Department of Health Care Services' (DHCS') request for a five-year extension of its Medicaid section 1115 demonstration and a five-year extension of its Medicaid managed care section 1915(b) waiver. Both were scheduled to expire on December 31, 2021. The demonstration and managed care 1915(b) combination, re-named "California Advancing and Innovating Medi-Cal" (CalAIM), includes important provisions to advance health equity, fund key services, like home and community-based services (HCBS) for underserved communities, and improve access to care.

"CalAIM will advance health equity in California and strengthen the health care safety net," said CMS Administrator Chiquita Brooks-LaSure. "We appreciate the strong partnership with California to create pathways for people with Medi-Cal to more easily access equitable, comprehensive care."

Among several priorities, the extended programs create an easier pathway to support care for people outside of traditional health care settings. They also will help address enrollees' health-related social needs and strengthen access to care, including to HCBS, through the implementation of a framework of alternative, in lieu of services and settings (ILOS), designed for targeted, at-risk populations and intended to prevent institutionalization. CalAIM will provide $4.3 billion in total funding for the state's HCBS program. In times of crisis, this will reduce the likelihood of service disruptions for people who need HCBS to stay healthy and safe. CMS also notes that California qualifies for a temporary 10 percentage point increase to the federal medical assistance percentage for certain Medicaid expenditures for HCBS under section 9817 of the American Rescue Plan Act of 2021.

Funding under the demonstration and managed care waiver combination will also help transform service delivery networks at the community level. This includes support for building greater connections to people in need through provider and community-based organizations, as well as advancing interventions and services that can improve health outcomes (e.g., housing transition services to support individuals' movement from institutional care to the community living, and home modifications and environmental adaptations to enable individuals to remain in the community and avoid institutional placement).

As a result, Californians enrolled in Medicaid health insurance will benefit from greater access to health care services and better integration of physical and behavioral health-related services. These priorities remain particularly important to historically underserved communities impacted by factors that have widened the gaps for economic and social marginalization. With one of the country's most diverse populations, California will now benefit from a Medicaid program that can better align its capabilities with the needs of its residents.

The CalAIM 1115 demonstration extension includes support for a number of other priorities, including care for formerly out-of-state foster care youth, and the continuation of certain benefits through Tribal health programs. Additionally, the CalAIM managed care 1915(b) waiver takes significant steps to improve network adequacy and strengthen access to medically necessary services (including primary care services, specialty care, maternal health care, behavioral health services like substance use disorder services, and oral health care). This will yield greater accountability, improved data, and greater transparency around network adequacy and timely access.

For the CMS approval letter to California, for the section 1115(a) demonstration five year extension, please visit: https://www.medicaid.gov/medicaid/section-1115-demonstrations/downloads/ca-calaim-ca.pdf

To view CMS' approval letter to California to renew its 1915b waiver, please visit: https://www.medicaid.gov/medicaid/section-1115-demo/demonstration-and-waiver-list/81091