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RELEASE: Bill Introduced to Keep Laboratory Jobs Based in California

AB 265 Protects Jobs & Medi-Cal Services When We Need Them the Most

For immediate release:

SACRAMENTO — In order to protect California jobs and preserve the state’s ability to provide critical services to Medi-Cal patients, Assemblywoman Cottie Petrie-Norris is reintroducing legislation to remove the 80% of Medicare cap on reimbursement rates for laboratories in California.

Congressional action in 2018 upended the intent of California’s 2012 Budget Act which maintained a market-based method to determine the fee-for-service Medi-Cal reimbursement rate for lab services. The result was an automatic cut to our carefully calculated Medi-Cal lab rates. Without a change in policy, California will continue to undermine providers’ and laboratories’ ability to confront the COVID-19 pandemic and other health crises such as the ongoing STI epidemic. With the removal of the cap, California labs would be able to avoid this federally triggered cut and operate how the state originally intended.

“Laboratories provide 75,826 California jobs that we cannot afford to lose in the face of an unprecedented unemployment crisis and the COVID-19 pandemic,” said AB 265 Author Assemblywoman Cottie Petrie-Norris (D-Laguna Beach). “With the protection of tens of thousands of California jobs, we can also ensure the stability of critical Medi-Cal services across the state.”

“AB 265 is necessary to ensure equitable and sustainable payment rates in Medi-Cal for clinical diagnostic laboratory tests,” said Kristi Foy from the California Clinical Laboratory Association. “Assemblymember Petrie-Norris’ bill will properly update Medi-Cal’s payment policies for clinical laboratory testing and will expand access to testing throughout California.”

“Planned Parenthood Affiliates of California applauds Assemblymember Petrie-Norris for introducing AB 265, a necessary step to protecting Medi-Cal lab rates from unduly cuts. Maintaining investment in Medi-Cal rates supports providers on the frontlines of the COVID-19 pandemic, along with the many patients who are being dually impacted by COVID-19 and systemic racism,” said Jodi Hicks, President and CEO of Planned Parenthood Affiliates of California, “A critical step in the fight for health equity, this bill ensures safety-net providers, like Planned Parenthood, are able to provide and be adequately reimbursed for critical health services, like HIV and STI tests.” 

By avoiding federally triggered cuts, AB 265 will maintain the policy intent of California set in 2012 and ensure the state retains high-quality jobs that help provide critical lab services in the fight against COVID-19 and other health crises faced by Californians.