It will result in more than 13 million dollars in savings for the first year, and greater savings in later years.
Dr. Ted Mazer of the California Medical Association says this is bad news for kids. He says the Healthy Families program provides better payment systems and better health access.
MAZER: "Now we're going to take the successful program recipients and throw them to the wolves in a very unsuccessful Medi-Cal program. It makes no sense."
Toby Douglas of the California Department of Health Care Services says the transition will simplify administration as well as the patient experience.
Douglas and advocates say the Medi-Cal system will provide more health benefits to children in California's health safety net.