Legislation Proposes Big Changes to SMAA Contract Structure and RMTS Program

Senate Bill 123 (Liu-D) has been amended to include several proposed changes for California’s School-Based Medi-Cal Administrative Activities (SMAA) program.

First introduced in January 2015, SB 123 was written to legislate recommendations that the California State Auditor made during their audit of DHCS’ administration of the SMAA program and deferral that was performed last year.

Principle among the changes proposed in SB 123:

  1. California would transition to a single statewide random moment time survey (RMTS), similar to the structure employed by most other states using RMTS for their Medicaid administrative claiming programs.


  1. LEAs would be able to contract directly with DHCS for their participation in the program, eliminating the need to contract with a Local Governmental Agency (LGA), Local Educational Consortium (LEC), or other Consortium. This would mirror the contract and administrative structure of the LEA Medi-Cal Billing Option program, which has successfully been in place since the program’s inception.


  1. A new stakeholder workgroup, to be called the School-Based Health Program and Policy Workgroup, would be formed to monitor and discuss improvements to the SMAA program; the new Workgroup would incorporate the existing LEA Ad-Hoc Workgroup which meets to achieve similar objectives related to the LEA Medi-Cal Billing Option program. An annual report to the state legislature on the work of this group and progress of both the SMAA and LEA programs would also be required.


  1. California’s Department of Education (CDE) would take a larger role in consulting and working with the Department of Health Care Services (DHCS) in their administration of the SMAA program.


  1. Up to six percent of program reimbursements will be withheld by DHCS to cover the costs associated with provisions outlined in the bill; an annual reconciliation of actual costs incurred will determine the final amount withheld from LEAs for the administration of the program in its new form.


SB 123 will have to pass both houses by August and be signed into law by Governor Jerry Brown in September to be implemented. There is a long road ahead for this bill, and we will continue to track its progress on the Policy Center.