Welf. & Inst. Code, § 14154.1

Reimbursement for any Medi-Cal county administrative costs shall be made subject to the requirements specified in the County Administrative Cost Control Plan, established pursuant to Section 14154. However, notwithstanding any other provision of law, for applications taken on or after July 1, 1987, and thereafter, the department shall make allocations for Medi-Cal county administrative expenses taking into consideration all Medi-Cal applications. However, if the department determines that a county is inappropriately processing non-Medi-Cal applications through the Medi-Cal process, then the department shall not allocate state general funds for nonapproved Medi-Cal applications which exceed a specified level. That level shall be determined by multiplying the county’s number of approved applications by the ratio of nonapproved applications to approved applications processed by the county during the base period used in the cost control plan which is in effect for the fiscal year the inappropriate processing of non-Medi-Cal applications occurred. Reimbursement to Los Angeles County hospitals shall be limited on the same basis.