DHCS Released Formal State-Only PPS-to-Non-PPS Notice — Historical July 2026 Effective Date Superseded by Signed-Budget Delay
Historical implementation record: DHCS released its formal Federally Qualified Health Center and Rural Health Clinic State-Only Reimbursement Methodology Change Notice on April 24, 2026, then confirming a July 1, 2026 effective date for transitioning State-Only services from Prospective Payment System (PPS) reimbursement to fee-for-service Medi-Cal Fee Schedule rates or negotiated managed-care plan rates.
Signed-budget override: the June 29 enacted 2026-27 budget later appropriated $1.034B General Fund for clinic PPS in 2026-27 and delayed the major State-Only/UIS PPS reduction to July 1, 2027. Preserve this notice as historical proposal/implementation context, but the live CFO planning horizon is now July 1, 2027 pending updated DHCS guidance.
Key takeaways
- Formal April 24 notice is historical context; the signed budget later delayed the major State-Only/UIS PPS cut to July 1, 2027.
- Keep the 50-70% per-encounter delta in sensitivity models, but refresh timing against final DHCS 2027 guidance.
- CFOs should model FY2027-28 exposure, not present July 2026 as current law.
- Still a trigger for MCP rate negotiation, cross-subsidy planning, and fundraising strategy.
Primary source
California DHCSSource packet
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FQHC Talent. (2026, April 24). DHCS Released Formal State-Only PPS-to-Non-PPS Notice — Historical July 2026 Effective Date Superseded by Signed-Budget Delay. Primary source: California DHCS. Retrieved August 2, 2026, from https://www.fqhctalent.com/intel/dhcs-fqhc-rhc-state-only-non-pps-formal-notice-april-24-2026
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