(a) (1) The State Department of Health Care Services shall select primary care clinics that are licensed under subparagraph (A) or (B) of paragraph (1) of subdivision (a) of Section 1204, or are exempt from licensure under subdivision (c) of Section 1206, to be reimbursed for delivering medical services, including preventive health care, and smoking prevention and cessation health education, to program beneficiaries. (2) In order to be eligible to receive funds under this article a clinic shall meet all of the following conditions, at a minimum: (A) Provide medical diagnosis and treatment. (B) Provide medical support services of patients in all stages of illness. (C) Provide communication of information about diagnosis, treatment, prevention, and prognosis. (D) Provide maintenance of patients with chronic illness. (E) Provide prevention of disability and disease through detection, education, persuasion, and preventive treatment. (F) Meet one or both of the following conditions: (i) Be located in an area or a facility federally designated as a health professional shortage area, medically underserved area, or medically underserved population. (ii) Be a clinic that is able to demonstrate that at least 50 percent of the patients served are persons with incomes at or below 200 percent of the federal poverty level. (3) Notwithstanding the requirements of paragraph (2), all clinics that received funds under this article in the 1997â98 fiscal year shall continue to be eligible to receive funds under this article. (b) As a part of the award process for funding pursuant to this article, the department shall take into account the availability of primary care services in the various geographic areas of the state. The department shall determine which areas within the state have populations that have clear and compelling difficulty in obtaining access to primary care. The department shall consider proposals from new and existing eligible providers to extend clinic services to these populations. (c) A primary care clinic applying for funds pursuant to this article shall demonstrate that the funds shall be used to expand medical services, including preventive health care, and smoking prevention and cessation health education, for program beneficiaries above the level of services provided in the 1988 calendar year, or in the year prior to the first year a clinic receives funds under this article if the clinic did not receive funds in the 1989 calendar year. (d) (1) The department, in consultation with clinics funded under this article, shall develop a formula for allocation of funds available. It is the intent of the Legislature that the funds allocated pursuant to this article promote stability for those clinics participating in programs under this article as part of the stateâs health care safety net and at the same time be distributed in a manner that best promotes access to health care to uninsured populations. (2) The formula shall be based on both of the following: (A) A hold harmless for clinics funded in the 1997â98 fiscal year to continue to reimburse them for some portion of their uncompensated care. (B) Demonstrated unmet need by both new and existing clinics, as reflected in their levels of uncompensated care reported to the department. For purposes of this article, âuncompensated careâ means clinic patient visits for persons with incomes at or below 200 percent of the federal poverty level for which there is no encounter-based third-party reimbursement which includes, but is not limited to, unpaid expanded access to primary care claims. (3) The department shall allocate available funds, for a three-year period, as follows: (A) Clinics that received funding in the prior fiscal year shall receive 90 percent of their prior fiscal year allocation, subject to available funds, provided that the funding award is substantiated by the clinicsâ reported levels of uncompensated care. (B) The remaining funds beyond 90 percent shal
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