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Strategies to Reduce Health Disparities

Using Purchasing Power


Rhoda Abrams, M.B.A., Director, Center for Managed Care, Health Resources and Services Administration (HRSA), Rockville, MD

Gregory A. Franklin, M.H.A., Chief, California Office of Multicultural Health, California Department of Health Services, Sacramento, CA

Felicia A. Batts, M.P.H., Quality Improvement Specialist/Cultural and Linguistics Services Consultant, HealthNet—Government Programs, Fresno, CA

The Health Resources and Services Administration's (HRSA) mission is to assure access to health services for vulnerable populations, which it does through:

  • Awarding grants to provider organizations.
  • Helping to ensure that HRSA grantees receive Medicaid/State Children's Health Insurance Program (SCHIP) reimbursement.
  • Working to encourage State managed care programs to include HRSA provider participation.
  • Reviewing States' Medicaid policies to ensure that appropriate patient protections (including cultural and language competency safeguards) are in place. HRSA views cultural competence as a key patient protector.

HRSA participated in the development of model contract language that may be used by health care purchasers in contracts with managed care providers. These specifications are designed to be a technical assistance tool for States and are optional. After review by experts in the field of cultural competency, Medicaid, and representatives from managed care organizations, the specifications were issued January 2001.

The cultural competency specifications address the following areas:

  • Rights to interpreter services (oral and written translation).
  • Cultural composition of provider networks.
  • Cultural diversity and cultural competency of health plan administrative staff.
  • Data collection and reporting of a number of cultural components.
  • Compliance measures.

California is an example of a State that has used purchasing power to address issues related to the cultural and/or linguistic competency requirements of contracted Managed care organizations (MCOs). The Office of Multicultural Health worked with the Division of MediCal Managed Care and other private and public sector stakeholders to develop a series of five policy letters. In developing the letters, the coalition was guided by a set of basic principles including:

  • Compliance with State and Federal laws.
  • Recognition that one approach to fulfilling the contract requirements may not fit all MCOs.
  • The need to be sensitive to the political environment in which the policy letters were being developed.
  • The limitations of what the State could require within the established capitation rates.
  • The need to develop policies to enforce the requirements.
  • The need to recognize competing MCO priorities.
  • The need to take into consideration concerns about lack of dedicated funding to implement the requirements.

The MediCal Managed Care Division of the Department of Health Services published the five policy letters on April 2, 1999. The policy letters clarify the responsibilities of MCOs related to cultural competency and the provision of linguistically appropriate services. The policy letters address the following issues:

  • Establishment of community advisory committees.
  • Conducting education and cultural and linguistic group needs assessments.
  • Providing linguistic services.
  • Translation of written information materials.
  • Guidelines for meeting the needs of culturally and linguistically diverse populations.

California officials believe that the policy letters establish a floor in terms of what must be done and that it is reasonable for MCOs to go beyond what is required by the policy letters.

The policy letters also define threshold and concentration languages for the provision of linguistic services. Threshold language is defined as: primary language spoken by population groups with limited English proficiency meeting a numeric threshold of 3,000 eligible beneficiaries residing within a county. Concentration-standard languages are defined as: language spoken by population groups meeting a concentration standard of 1,000 in a single ZIP Code or 1,500 within two contiguous ZIP Codes.

HealthNet is one of the MCOs contracted with the State of California to provide services to the MediCal population and is implementing the requirements and recommendations of the policy letters.

First Policy Letter

The first policy letter addresses the contract requirements to provide translation services for threshold and concentration languages and includes the right to:

  • Use an interpreter at no cost.
  • Not use a family member as an interpreter.
  • Request an interpreter.
  • Receive quality translated written information materials.
  • File a complaint or grievance if linguistic needs are not met.

Interpreter services provided by HealthNet include:

  • 24-hour member services with a telephone line staffed by bilingual and bicultural staff members.
  • Member relations department providing toll-free language line services to new members and identifying special needs among members.
  • Marketing department hiring bilingual and bicultural staff to provide member education and outreach.

Second Policy Letter

The second policy letter addresses making translated health plan materials available to members with limited English proficiency who speak threshold or concentration languages. Members have the right to receive quality translated written information materials, including all vital documents that include:

  • Evidence of coverage.
  • Provider directories.
  • Marketing materials.
  • Form letters.
  • Member surveys.
  • Health plan newsletters.

HealthNet ensures accuracy, completeness, and reliability of translated materials through:

  • Use of two different qualified translators.
  • Internal review of translations by bilingual and bicultural staff.
  • Professional review.
  • Field-testing of documents in the community.

Third Policy Letter

The third policy letter requires the establishment of community advisory committees. HealthNet has five regional community advisory committees, comprised of:

  • MediCal consumers.
  • County representatives.
  • Representatives of perinatal and child health programs.
  • Community advocates.
  • Key community leaders.
  • Contracted safety net providers.

The committees advise on cultural competency and educational and operational issues affecting groups who speak a language other than English. Their functions include:

  • Developing culturally appropriate services or program design.
  • Establishing priorities for health education and outreach.
  • Reviewing member satisfaction survey results.
  • Reviewing findings of health education and cultural and linguistic group needs assessment.
  • Reviewing health plan marketing materials and campaigns.
  • Providing communication regarding the development and assessment of provider networks specific to language and culture.
  • Identifying community resources and information.

Fourth Policy Letter

The group needs assessment is addressed in the fourth policy letter. MCOs must conduct internal and external data reviews to assess the language and cultural needs of the populations being served and the ability of provider network and administrative capacity to meet those needs. External data sources include:

  • County demographics.
  • Economic status of the county's residents.
  • Educational level in the population and the extent to which government-funded services are used within the county.

Internal data sources include:

  • Member demographics.
  • Cultural and language composition of the provider network.
  • Results of member satisfaction surveys.
  • MCO health education programs.
  • Health status indicators of the population being served.
  • Provider surveys.
  • Key informant interviews.

The group needs assessments culminates in the development of a work plan that addresses the development of health education programs and cultural and linguistic services.

Fifth Policy Letter

The fifth policy letter defines cultural competence in health care and offers guidelines in building culturally competent systems. To comply with issues raised in the fifth policy letter, HealthNet has:

  • Established a special office with designated staff to coordinate and facilitate the integration of cultural competency guidelines.
  • Developed internal systems to meet the cultural and linguistic needs of its members.
  • Provided initial and continuous training on cultural competence to staff and providers.
  • Participated with government, community, and educational institutions in matters related to best practices.

Challenges to implementing the requirements of the policy letters include:

  • Lack of additional funding from the State to implement special programs targeted to a diverse population.
  • The States passive enforcement policy.
  • Collaboration with other MCOs while maintaining a competitive edge.
  • The limitations of nonclinical services in their ability to reduce health disparities.
  • The difficulty of measuring and comparing compliance because each MCO in California implements the requirements differently.

Benefits include:

  • Added value to an MCO's services, thereby helping it to expand its market share and to enhance the quality of care.
  • Collaboration allows MCOs to pool their resources to develop and implement programs to meet the language and culture needs of their enrolled populations.
  • The provision of culturally competent health care services can improve access and impact health outcomes.

Additional Resources

Coye M, Alvarez D. Executive summary: Medicaid managed care and cultural diversity in California. New York (NY): The Commonwealth Fund; 1999 Mar.

George Washington University Medical Center, School of Public Health. Optional purchasing specifications: Cultural competence in the delivery of services through Medicaid managed care. Washington (DC): The Center; 2001 Jan.

Health Resources and Services Administration. Cultural competence works: Using cultural competence to improve the quality of health care for diverse populations and add value to managed care arrangements. U.S. Department of Health and Human Services, Health Resources and Services Administration; (release date forthcoming).

United States Constitution. Title VI, Civil Rights Act of 1964 [42 U.S.C. 2000d et seq]; 1986 Oct.

Current as of April 2001

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Internet Citation:

Strategies to Reduce Health Disparities. Workshop Brief, April 4-6, 2001, User Liaison Program. Agency for Healthcare Research and Quality, Rockville, MD.

The information on this page is archived and provided for reference purposes only.

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