Cal. Welfare and Institutions Code § 14115.4

If the Budget Act should in any budget year restrict payment for pathology services under the Medi-Cal program to only the provider who actually performs those services, this restriction shall not prohibit any of the following: (a) Reimbursement of a hospital for pathology services performed by an outside reference laboratory for hospital patients. (b) Reimbursement of a clinical laboratory for performance of pathology services that are referred to another clinical laboratory. (c) Reimbursement of a clinical laboratory when pathology services are performed at a different testing location owned and operated by the same clinical laboratory. Services provided pursuant to subdivision (a), (b), or (c) shall be reimbursed in accordance with the rules and regulations of the department.