We have been informed that on September 28th, CMS sent a request for additional information to DHCS on their State Plan Amendment (SPA) that included the 10% Medi-Cal Provider rate cut that was to be effective on June 1, 2011. That request stops the clock on the 90-day SPA approval cycle. A new 90-day clock would start once DHCS submits the requested information to CMS .

We do not know the details of the specific information requested but assume it would relate to data on the potential access issues that might occur with the provider rate reductions. DHCS has submitted data to CMS on that issue in the past but has heretofore refused to release that data to the provider community or the media. A legal action may be filed to demand release of that information.

This does not end the issue and CMS may eventually still approve the reductions. We are informed that it is likely that CMS will issue approval on the 1% provider rate reduction that has been in effect since March 1, 2009. There also remains a risk that if CMS does eventually approve the 10% cut that it could be retroactive to 6/1/11.