About Finance & Reimbursement
Vulnerable Californians who rely on the care provided by California hospitals are at risk. Driven by skyrocketing costs for labor, pharmaceuticals, regulatory mandates, and more, 53% of all hospitals statewide lose money every day to deliver patient care.
That isn’t sustainable. And California is already seeing the frightening result: rural health care services being cut to the bone, severe behavioral health care needs not being met, and more.
CHA Board Member Testifies Before Assembly Health Committee
What’s happening: Earlier this week, Lori Morgan, MD, MBA, President & CEO of Huntington Health in Pasadena — who is also a member of the boards of both CHA and the American Hospital Association — shared an important perspective before the state Assembly Health Committee on how the Los Angeles fires impacted surrounding communities and the role of hospitals in California’s response to this and other disasters.
What else to know: Dr. Morgan’s testimony was an important opportunity to share perspective on hospitals’ unique role in disaster response and the ways that state government can be helpful before, during, and after crises to ensure an efficient, rapid response that delivers care for Californians.
MedPAC Issues Report to Congress with Payment Recommendations
What’s happening: On March 13, the Medicare Payment Advisory Commission (MedPAC) released its report to Congress that includes fiscal year 2026 payment recommendations for hospitals and other Medicare fee-for-service payment systems.
What else to know: In the report, MedPAC urges Congress to update the base payment rate for hospitals by current law plus 1%.
DHCS to Submit Hospital Fee Program 9 This Month
What’s happening: The Department of Health Care Services (DHCS) will submit the Hospital Quality Assurance Fee (HQAF) program 9 to the Centers for Medicare & Medicaid no later than March 31. Once submitted, CHA will share a draft model for member hospitals to review that will include internal calculations to assist in their review.
What else to know: Shortly after the approved model is released, CHA will host a webinar to provide historical HQAF program context and share the changes specific to program 9. CHA News will share updates and information on program 9’s status, as well as related educational opportunities, as they become available.
CHA Gathering Focuses on Financial Sustainability of Critical Access Hospitals
What’s happening: CHA convened leadership from California’s critical access hospitals (CAHs) for a strategic discussion on achieving financial sustainability. The meeting took place Feb. 20-21 in Sacramento.
What else to know: CEOs and chief financial officers from private, system, and district hospitals participated in small group discussions — led by Todd Linden of Linden Consulting, a retired CEO with 40 years of experience in CAH leadership — to identify the most pressing operational challenges and explore potential solutions. Key issues include aging infrastructure and persistent workforce shortages.
Hospital Fee Program Fees Due March 7
What’s happening: Hospital Quality Assurance Fee (HQAF) program 8 fees for the Jan. 1-June 30, 2023, managed care directed payment cycle are due March 7 — and the invoice will be 15% higher than the modeled fee amount.
What else to know: The fee is increased because the Department of Health Care Services (DHCS) is repaying the Centers for Medicare & Medicaid Services (CMS) for inpatient upper payment limit (UPL) overages incurred in HQAF program 6 — and CMS directed DHCS to repay immediately without any flexibility.
New Analysis Shares Potential Impact of FFY 2026 Value-Based Purchasing Program (Third Quarter 2024 Data Update)
What’s happening: CHA DataSuite issued a hospital-specific analysis of the Value-Based Purchasing (VBP) Program, which is based on the most recent publicly available data and program rules established by Centers for Medicare & Medicaid Services (CMS). The analysis is intended to give hospitals a preview of the potential impact of the federal fiscal year (FFY) 2026 VBP program.
What else to know: Comparison to the FFY 2025 program performance is limited as CMS has not yet made final measure and domain level scores available.
Beginning FFY 2026, hospitals will be awarded health equity adjustment (HEA) bonus points for excellent care of underserved populations based on their performance in the four evaluated domains, as well as their percentage of full-dually-eligible patients. An HEA estimate is included in this analysis. There will be winners and losers due to the HEA, as the program slope changes with the additional bonus points.
Correction Requests for Medicare Hospital FFY 2026 Wage Index, Occupational Mix Revised Data Due Feb. 18
What’s happening: CHA DataSuite issued a hospital-specific analysis of the Medicare hospital federal fiscal year (FFY) 2026 wage index and occupational mix revised data — and it is imperative that hospitals review these data, as they have until Feb. 18 to submit requests for either error corrections or revisions.
What else to know: The data analyzed is revised and is the second of three wage and occupational mix data public use files (PUFs) that the Centers for Medicare & Medicaid Services (CMS) issued to develop the hospital wage index for FFY 2026.
2025 Hospital Finance and Reimbursement Conference
November 3 & 4, 2025 | Newport Beach Join CHA and California hospital finance experts for an in-person program examining the fiscal impact of state and federal regulations and policies. This event will delve into critical topics such as public payer financing, financial regulations, managed care payment plans, the Office of Health Care Affordability, and […]
CHA Presentation Details Hospitals’ Role in Health Care Ecosystem
What’s happening: As part of CHA’s efforts to educate new and existing lawmakers on hospitals’ role in the health care ecosystem, Kathryn Austin Scott, senior vice president, state relations and advocacy, and vice presidents of advocacy Kalyn Dean, Mark Farouk, and Vanessa Gonzalez hosted a “Hospital 101” legislative staff briefing on Jan. 14.
CHA Publishes New Advocacy Materials on Priority Issues
What’s happening: In December, CHA’s board approved three advocacy priorities for California hospitals in 2025: Insurer Accountability, Office of Health Care Affordability (OHCA), and Securing Hospitals. New and updated advocacy materials on these priority issues are now available on CHA’s website.