BILL NUMBER: AB 847 CHAPTERED 09/22/05 CHAPTER 315 FILED WITH SECRETARY OF STATE SEPTEMBER 22, 2005 APPROVED BY GOVERNOR SEPTEMBER 22, 2005 PASSED THE ASSEMBLY AUGUST 29, 2005 PASSED THE SENATE AUGUST 22, 2005 AMENDED IN SENATE JULY 1, 2005 AMENDED IN ASSEMBLY APRIL 14, 2005 INTRODUCED BY Assembly Member Berg FEBRUARY 18, 2005 An act to add Sections 1231.5, 1580.1, 1734.5, and 100315 to the Health and Safety Code, relating to the elderly. LEGISLATIVE COUNSEL'S DIGEST AB 847, Berg Program for All-Inclusive Care for the Elderly. Existing law establishes the federal Medicaid program, administered by each state, California's version of which is the Medi-Cal program. The Medi-Cal program, which is administered by the State Department of Health Services under the direction of the Director of Health Services, provides qualified low-income persons with health care services. Existing federal law establishes the Programs of All-Inclusive Care for the Elderly (PACE), which provides specified services for older individuals so that they may continue living in the community. Federal law permits states to implement the PACE program as a Medicaid state option. Existing state law authorizes the department to establish the California Program of All-Inclusive Care for the Elderly, and to contract with up to 10 demonstration projects to develop risk-based long-term care pilot programs, and establishes PACE program services as a covered benefit of the Medi-Cal program. This bill would authorize the State Department of Health Services, and as applicable, the State Department of Social Services, and the California Department of Aging to grant exemptions to a PACE program from licensing and regulatory requirements applicable to clinics, residential care facilities for the elderly, and home health agencies. The bill would require the department to approve or deny any request for an exemption in writing within 60 days of submission. The bill would authorize the department to suspend or revoke an exemption that has been granted to a PACE program if the department determines the PACE program is operating in a manner contrary to the terms of the exemption or if the exemption is applicable to one or more license categories or locations. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. The Legislature finds and declares all of the following: (a) The State Department of Health Services has established the California Program for All-Inclusive Care for the Elderly (PACE), to promote the development of community-based capitated, health, and long-term care programs for the frail elderly. (b) The department, in coordination with the federal Centers for Medicare and Medicaid Services, has entered into contracts with PACE organizations under Chapter 8.75 (commencing with Section 14590) of Part 3 of Division 9 of the Welfare and Institutions Code, which require PACE organizations to meet federal regulations under subchapter E (commencing with Section 460) of Chapter 4 of Title 42 of the United States Code of Federal Regulations, and applicable state requirements. (c) PACE organizations are required by federal law and regulation to provide comprehensive medical, health, and social services at PACE centers, inpatient facilities, participant homes, and other locations, under the direction and supervision of an interdisciplinary team of physicians, nurses, and other health professionals who assess participant needs, develop care plans, and deliver all services, which are integrated into a complete health care plan. PACE organizations offer and manage all of the medical, social, and rehabilitative services their participants need to preserve or restore their independence, to remain in their homes and communities, and to maintain their quality of life. (d) In order to provide the range of services required by federal and state laws, PACE organizations are subject to regulations of multiple state departments and agencies, including Medi-Cal managed care as well as licensing for clinic services, home health services, and adult day health care services. PACE organizations deliver services in participants' home environments, which may include independent living arrangements, congregate housing, and board and care or residential care facilities. (e) The state regulations that are applicable to PACE organizations are in some instances conflicting and inappropriate for PACE organizations or are inconsistent with federal or other state requirements that are specially adapted to the PACE model for providing health and care services. (f) In addition, PACE organizations are required to hold several licenses for the same licensed service in multiple locations, requiring multiple applications and other communications with the department. SEC. 2. Section 1231.5 is added to the Health and Safety Code, to read: 1231.5. The department may grant to a PACE program, as defined in Chapter 8.75 (commencing with Section 14590) of Part 3 of Division 9 of the Welfare and Institutions Code, exemptions from the provisions contained in this chapter in accordance with the requirements of Section 100315. SEC. 3. Section 1580.1 is added to the Health and Safety Code, to read: 1580.1. The State Department of Health Services, and as applicable, the California Department of Aging, may grant to entities contracting with the State Department of Health Services under the PACE program, as defined in Chapter 8.75 (commencing with Section 14590) of Part 3 of Division 9 of the Welfare and Institutions Code, exemptions from the provisions contained in this chapter in accordance with the requirements of Section 100315. SEC. 4. Section 1734.5 is added to the Health and Safety Code, to read: 1734.5. The department may grant to entities contracting with the department under the PACE program, as defined in Chapter 8.75 (commencing with Section 14590) of Part 3 of Division 9 of the Welfare and Institutions Code, exemptions from the provisions contained in this chapter in accordance with the requirements of Section 100315. SEC. 5. Section 100315 is added to the Health and Safety Code, to read: 100315. (a) The department and as applicable, the California Department of Aging and the State Department of Social Services, may grant to a PACE program, as defined in Chapter 8.75 (commencing with Section 14590) of Part 3 of Division 9 of the Welfare and Institutions Code, exemptions from the provisions contained in Chapter 1 (commencing with Section 1200), Chapter 3 (commencing with Section 1500), Chapter 3.2 (commencing with Section 1569), Chapter 3.3 (commencing with Section 1570), and Chapter 8 (commencing with Section 1725) of Division 2, and Divisions 3 and 5 of Title 22 of the California Code of Regulations, including the use of alternate concepts, methods, procedures, techniques, space, equipment, personnel, personnel qualifications, or the conducting of pilot projects, provided that the exemptions are implemented in a manner that does not jeopardize the health and welfare of participants receiving services under PACE, or deprive beneficiaries of rights specified in federal or state laws or regulations. In determining whether to grant exemptions under this section, the departments shall consult with each other. (b) A written request and substantiating evidence supporting the request for an exemption under subdivision (a) shall be submitted by the PACE program to the department. A PACE program may submit a single request for an exemption from the licensing requirements applicable to two or more licenses held by that organization, so long as the request lists the locations and license numbers held by that organization and the requested exemption is the same and appropriate for all licensed locations. The written request shall include, but shall not be limited to, all of the following: (1) A description of how the applicable state requirement conflicts with or is inconsistent with state or federal requirements related to the PACE model. (2) An analysis demonstrating why the conflict or inconsistency cannot be resolved without an exemption. (3) A description of how the PACE program plans to comply with the intent of the requirements described in paragraph (1). (4) A description of how the PACE program will monitor its compliance with the terms and conditions under which the exemption is granted. (c) The department shall approve or deny any request within 60 days of submission. An approval shall be in writing and shall provide for the terms and conditions under which the exemption is granted. A denial shall be in writing and shall specify the basis therefor. Any decision to deny a request shall be a final administrative decision. (d) If, after investigation, the department determines that a PACE program that has been granted an exemption under this section is operating in a manner contrary to the terms and conditions of the exemption, the department shall immediately suspend or revoke the exemption. If the exemption is applicable to more than one location or more than one category of licensure, or both, the department may suspend or revoke an exemption as to one or more license categories or locations as deemed appropriate by the department.