California Medical Billing and Payer Rules

Timely Filing in California Medical Billing and Payer Rules

California Medical Billing and Payer Rules Surprise Billing vs the Federal NSA

Major Payers

How Does Medi-Cal Billing Work?

California Medicaid is called Medi-Cal and is run by the Department of Health Care Services (DHCS). A claim goes one of two ways: fee-for-service, billed to the state's claims contractor, or managed care, billed to the patient's health plan. Deciding which one applies is the first job on every Medi-Cal account.

DHCS's billing page names the fee-for-service contractor as the California MMIS Fiscal Intermediary, the fiscal intermediary that receives claims and answers provider calls. Facility claims use the UB-04 and professional claims the CMS-1500. Our Medicaid payer guide covers the national rules.

Which Medi-Cal Managed Care Plans Do Hospitals Bill?

Medi-Cal managed care runs through managed care organizations under five models: Two-Plan, County Organized Health Systems, Geographic Managed Care, Regional Model and Single-Plan, according to the DHCS managed care page. Providers who treat enrollees must join the plan's network.

The model depends on the county. DHCS's September 2025 table of 2026 plans shows Los Angeles County under the Two-Plan model with Health Net Community Solutions and L.A. Care Health Plan. Contracts changed in 2024, so check the DHCS Health Plan Directory for the plan on the date of service.

DMHC's 2026 claims guidance applies to commercial and Medi-Cal plans alike, so the 30 calendar day payment rule below reaches Medi-Cal plans too. AB 72 and the ground ambulance payment rule in Health and Safety Code 1371.56 do not. This page cites no managed care filing limit, so we load each plan's limit from its contract.

What Is the Medi-Cal Timely Filing Limit?

Medi-Cal fee-for-service bills must be submitted not more than six months after the month in which the service was rendered, under Welfare and Institutions Code 14115(a). Medicare allows one calendar year from the date of service under 42 CFR 424.44.

Late claims are paid at a price: 25 percent less in the seventh through ninth month after the month of service, 50 percent less in the 10th through 12th, unless an exception applies.

Managed care and commercial limits come from the contract. Health and Safety Code 1371.35(l) says the prompt pay rules do not affect a written agreement to submit bills within a set period.

Who Is the Medicare MAC for California?

The Medicare Administrative Contractor (MAC) for California Part A and Part B claims is Noridian Healthcare Solutions, LLC, in Jurisdiction E (JE). CMS's list of MACs by state shows JE covering California, Hawaii, Nevada, American Samoa, Guam and the Northern Mariana Islands.

Claims are due within one calendar year after the date of service under 42 CFR 424.44. Our Medicare payer guide covers appeals. Nevada shares JE, while Arizona and Oregon sit in Noridian's Jurisdiction F.

Who Regulates Commercial Plans in California, DMHC or CDI?

Two agencies split commercial regulation. The Department of Managed Health Care (DMHC) licenses health care service plans under the Knox-Keene Act, and the California Department of Insurance (CDI) regulates insurers that sell health insurance policies. Which one governs a claim decides the prompt pay statute, the dispute process and the complaint route.

Check the regulator named on the member card or denial notice, and confirm with the payer. Self-funded employer plans sit with neither agency, because federal law governs them. DMHC's help line is 1-888-466-2219 and CDI's is 1-800-927-4357. CDI takes provider complaints through its Health Care Provider Complaint portal, and DMHC's site lists a Provider Complaint Against a Plan route.

What Is California's Prompt Payment Rule, and What Interest Applies?

For claims received on or after January 1, 2026, a Knox-Keene plan must pay a complete claim within 30 calendar days under Health and Safety Code 1371 and 1371.35, and a CDI insurer has the same 30 calendar days under Insurance Code 10123.13. AB 3275 replaced the older rule of 30 working days (45 for an HMO), so claims received before 2026 stay on the old clock.

Interest must be added automatically, without a request. Under section 1371.35, the emergency services version of the rule, the provider has 10 working days to answer a plan's written request for information, and the plan gets 15 more calendar days to ask for anything further. DMHC's letter says interest and penalty apply to emergency claims too.

Provider disputes against a plan must get a written determination within 45 working days, and amounts found due are paid within five working days after it, with interest and penalties.

Does California Have Its Own Surprise Billing Law?

Yes. AB 72 (Health and Safety Code 1371.9, 1371.30 and 1371.31 for plans, Insurance Code 10112.8, 10112.81 and 10112.82 for insurers) covers non-emergency care by an out-of-network professional at an in-network facility. It applies to plans and policies issued, amended or renewed on or after July 1, 2017. CDI says it does not apply to Medi-Cal, Medicare or self-insured plans.

The patient owes only in-network cost sharing. Unless the parties agree otherwise, the plan pays the greater of the average contracted rate or 125 percent of Medicare fee-for-service for the same or similar services in the region. AB 72 defines a facility more widely than the federal rule: a licensed hospital, an ambulatory surgery or other outpatient setting under Health and Safety Code 1248.1, a laboratory, or a radiology or imaging center. Dentists are excluded.

A patient with out-of-network benefits can choose the professional in writing, but the form must be separate, signed at least 24 hours before care, not obtained by the facility, and come with a written cost estimate. Only the in-network cost share can go to collections, with no credit reporting, no lawsuit for 150 days after the first bill and no wage garnishment or home liens.

The federal No Surprises Act sits next to this. CMS's December 22, 2021 letter to California treats these AB 72 sections as specified state laws for non-emergency services at contracting facilities. It says federal IDR applies to items and services those sections do not cover, and to air ambulance. CMS's applicability chart lists California as a bifurcated state.

Can an Out-of-Network ER Physician Group Balance Bill in California?

For members of a DMHC-licensed plan, no. DMHC's letter 22-011 says California case law and the Knox-Keene Act prohibit balance billing for out-of-network emergency services, including post-stabilization care, citing Health and Safety Code 1371.4 and Prospect Medical Group v. Northridge Emergency Medical Group (2009).

Section 1371.4 requires a plan to reimburse emergency services until the patient is stabilized, without prior authorization. Payment can be denied only if the plan reasonably determines the services were never performed, or for a screening exam when the patient reasonably should have known there was no emergency.

The payment path is where the sources differ. DMHC says it confirmed with CMS that these laws are specified state law, so DMHC plans follow California law on emergency reimbursement and disputes. CMS's earlier December 2021 letter says federal IDR applies outside the AB 72 sections, which would include emergency care. DMHC's letter came later and speaks only for DMHC plans. No CDI notice is cited here, so for CDI policies we treat emergency disputes as federal until the payer shows otherwise.

Ground ambulance has its own rule for plans issued or renewed on or after January 1, 2024. Section 1371.56 limits the patient to in-network cost sharing, and the plan pays the local government's rate, or the amount in 28 CCR 1300.71(a)(3)(B) if there is none. The provider cannot sue the patient for at least 12 months after the first bill. Air ambulance disputes go to the federal process.

How Do You Dispute an Out-of-Network Underpayment in California?

Plan type and service type decide whether a claim goes to a state process or the federal one, and both state processes require the internal dispute first.

1. Confirm the regulator and funding type: DMHC plan, CDI insurer or self-funded plan. Self-funded plans go to open negotiation and federal IDR.
2. Classify the claim. Non-emergency care by a noncontracting professional at an in-network facility is AB 72. Emergency care is a separate analysis, as above.
3. For AB 72 claims, file the internal payment dispute. DMHC requires it to be complete within the last 365 days, and CDI counts 365 calendar days from the insurer's determination notice.
4. If a CDI insurer does not answer your internal appeal in 45 calendar days, CDI's guidance lets you file anyway, and the 365 days start on day 46.
5. File the IDRP application: DMHC's web portal for plans, CDI's Health Care Provider Complaint portal for insurers. CDI allows up to 50 claims in a bundle for the same insurer, professional and similar services in one calendar year.
6. For claims outside the state process, send the 30 business day open negotiation notice under 45 CFR 149.510, then start federal IDR within the 4 business day window after negotiation ends.

DMHC's IDRP excludes interest and late payment disputes, emergency services, dentists, Medi-Cal managed care plans and claims denied as not medically necessary. The independent organization has up to 30 calendar days to decide, fees are split equally, the decision binds both sides, and an application cannot be revised after filing. Our out-of-network billing and IDR service runs these tracks.

Which Payers Matter Most in California?

DMHC's enrollment table for the quarter ending December 31, 2024 lists Kaiser Foundation Health Plan with 6,645,013 commercial members, California Physicians' Service (Blue Shield of California) with 2,287,137 and Blue Cross of California with 2,164,825. Health Net of California follows with 515,188, then the UnitedHealthcare entities, Aetna and Cigna.

Our guides cover Kaiser Permanente, Blue Shield of California and Anthem. On the Medi-Cal side, DHCS's 2026 table lists plans such as L.A. Care Health Plan, Health Net Community Solutions, Anthem Blue Cross Partnership Plan and Kaiser Permanente, varying by county.

How We Handle Billing in California

For every California account we record the regulator and funding type at registration, then set the clock: six months from the month of service for Medi-Cal fee-for-service, one calendar year for Medicare, and 30 calendar days to chase a commercial claim received after January 1, 2026. Claims go out within 24 hours of charge entry and denials are worked within 48 hours.

For out-of-network cases we choose between the AB 72 process, open negotiation and federal IDR from the facts of each claim, and track every deadline. We also handle hospital and facility billing. Book a call and we will review your California payer mix first.