California has officially begun rolling out funds tied to Proposition 35, a voter-backed initiative aimed at strengthening Medi-Cal and expanding access to care across the state. After months of administrative delays and continuous advocacy by the California Medical Association (CMA), the state has initiated the first phases of funding distribution—targeting key areas in desperate need of support.

Whether you’re a physician, hospital administrator, or part of a community clinic, here’s what you need to know about the latest developments.

🚨 Emergency Department Supplemental Payments

The Department of Health Care Services (DHCS) submitted a State Plan Amendment (SPA) to CMS on September 30, 2025, requesting approval to use Prop 35 funds for emergency department physician payments. This includes E/M codes 99282–99285, with payments set to be retroactive to July 1, 2025. This funding is expected to support Medi-Cal providers who’ve long faced under-reimbursement in high-acuity care settings.

🏥 Reproductive Health & Abortion Care Funding

In response to ongoing threats to federal reproductive health funding, the state has begun distributing $90 million in Prop 35 grants via the California Department of Health Care Access and Information (HCAI). These funds aim to expand family planning and abortion services, supporting community-based organizations such as Planned Parenthood to ensure statewide access to essential care.

🎓 Graduate Medical Education (GME) Expansion

To address physician shortages, especially in underserved areas, $75 million in Prop 35 funding is being distributed through CalMedForce and CalMedForce+. This funding supports new residency and fellowship slots in both primary care and subspecialty training—administered in collaboration with Physicians for a Healthy California and the University of California.

🚑 Emergency Medical Transportation

A second SPA has been submitted to CMS to secure supplemental payments for Ground Emergency Medical Transportation (GEMT). Like the ED payments, this initiative would also be retroactive to July 1, 2025, and is designed to improve ambulance service reimbursement under Medi-Cal—crucial for stabilizing California’s emergency care network.

🔍 Looking Ahead

The CMA emphasizes that these implementations are just the beginning. Continuous monitoring and advocacy will be necessary to ensure that every Prop 35 dollar reaches the frontline services they were intended to support.

📌 Key Takeaways for Medical Providers

• Prepare for retroactive payments dating back to July 1, 2025 (ED and EMS)

• Review eligibility for HCAI-administered reproductive health grants

• Monitor CalMedForce GME opportunities for expansion or new programs

• Stay engaged with DHCS and CMA updates for additional Prop 35 rollouts

📞 Need help navigating Medi-Cal billing changes or planning for GME expansion?

Contact PractiCons today. Our medical consulting and billing experts are here to help your practice stay compliant, financially prepared, and ahead of upcoming policy changes.