BILL NUMBER: ABX4 6 CHAPTERED
BILL TEXT
CHAPTER 6
FILED WITH SECRETARY OF STATE JULY 28, 2009
APPROVED BY GOVERNOR JULY 28, 2009
PASSED THE SENATE JULY 23, 2009
PASSED THE ASSEMBLY JULY 23, 2009
AMENDED IN SENATE JULY 23, 2009
INTRODUCED BY Assembly Member Evans
JULY 2, 2009
An act to add Section 14166.221 to, and to add Article 5.4
(commencing with Section 14180) to Chapter 7 of Part 3 of Division 9
of, the Welfare and Institutions Code, relating to Medi-Cal, and
declaring the urgency thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 6, Evans. Medi-Cal.
(1) Existing law provides for the Medi-Cal program, which is
administered by the State Department of Health Care Services and
under which qualified low-income persons receive health care
benefits. The Medi-Cal program is, in part, governed and funded by
federal Medicaid provisions.
Existing law establishes the Medi-Cal Hospital/Uninsured Care
Demonstration Project Act that revises hospital reimbursement
methodologies in order to maximize the use of federal funds
consistent with federal Medicaid law and stabilize the distribution
of funding for hospitals.
Under existing law, to the extent required to maximize available
federal funds under the demonstration project and to the extent
authorized by the Special Terms and Conditions for the demonstration
project, the department may claim federal reimbursement for
expenditures in a certain priority order, as specified.
This bill would provide, notwithstanding the above-described
provisions, in order to maximize federal claiming under the
demonstration project, that the department shall have broad
discretion to claim federal reimbursement consistent with all
applicable federal claiming rules for certain expenditures in an
order of priority determined by the department. This bill would
authorize the department to claim for any and all additional
demonstration project funding made available pursuant to any
amendments to the demonstration project made on or after October 1,
2008, or pursuant to any federal laws that increase the amount of
available funding, including, but not limited to, the federal
American Recovery and Reinvestment Act of 2009. This bill would
provide that any amounts received in the 2008-09, 2009-10, and
2010-11 fiscal years from the federal government pursuant to
additional demonstration project funding, as specified in the above
provisions, shall be deposited in the Federal Trust Fund and would
authorize the Department of Finance to authorize expenditure of these
funds, as specified.
This bill would require the department to submit an application to
the federal Centers for Medicare and Medicaid Services (CMS) for a
waiver or demonstration project that would implement specified
objectives. The bill would require the waiver or demonstration
project to include designated restructuring proposals for the
organization and delivery of services under the Medi-Cal program. The
bill would require the department to submit the waiver or
demonstration project application to the CMS by a date that allows
sufficient time for the waiver or demonstration project to be
approved by no later than September 1, 2010, or the conclusion of any
extension period granted in the demonstration project set forth in
the Medi-Cal Hospital/Uninsured Care Demonstration Project Act,
whichever happens last.
(2) This bill would require the California Health and Human
Services Agency or successor entity or designated department to
submit an implementation plan to the appropriate policy and fiscal
committees of the Legislature for implementation of the federally
approved waiver or demonstration project for purposes of improving
health care for low-income Californians, as specified. This bill
would provide that the department shall only implement the waiver or
demonstration project upon submittal of an implementation plan to the
appropriate policy and fiscal committees of the Legislature at least
60 days prior to any appropriation.
This bill would require the agency or successor entity or
designated department, prior to preparing the implementation plan, to
convene a stakeholder committee to advise on preparation of the
implementation plan, as specified.
The California Constitution authorizes the Governor to declare a
fiscal emergency and to call the Legislature into special session for
that purpose. The Governor issued a proclamation declaring a fiscal
emergency, and calling a special session for this purpose, on July 1,
2009.
This bill would state that it addresses the fiscal emergency
declared by the Governor by proclamation issued on July 1, 2009,
pursuant to the California Constitution.
This bill would declare that it is to take effect immediately as
an urgency statute.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 14166.221 is added to the Welfare and
Institutions Code, to read:
14166.221. (a) It is the intent of the Legislature for the
department to maximize the receipt of federal funds for California's
Medi-Cal program, including this demonstration project, by
identifying state resources which will enable the state to obtain
additional federal reimbursement during this unprecedented fiscal
crisis. It is further the intent of the Legislature that any program
identified by the department for the purposes specified in this
section shall not be modified or altered in any manner unless
subsequent statutory authority is expressly provided by the
Legislature.
(b) Notwithstanding Section 14166.22, in order to maximize federal
claiming under the demonstration project, the department shall have
broad discretion to claim federal reimbursement consistent with all
applicable federal claiming rules for the following expenditures in
an order of priority determined by the department:
(1) Expenditures in programs funded in whole or in part by
realignment funds under Chapter 6 (commencing with Section 17600) of
Part 5, including, but not limited to, the County Medical Services
Program.
(2) Expenditures in programs funded in whole or in part by the
County Mental Health Services Act.
(3) Other public expenditures, to the extent the department
determines the expenditures to be appropriate for claiming under the
demonstration project.
(4) Expenditures in any programs referenced in subdivision (a) of
Section 14166.22 or other state-only funded programs as the
department, in its discretion, determines should be used for the
purposes of this section. These programs may include programs
administered by other state agencies or departments.
(c) The department shall have discretion to claim under this
section for any and all additional demonstration project funding made
available pursuant to any amendments to the demonstration project
made on or after October 1, 2008, or pursuant to any federal laws
that increase the amount of available funding, including, but not
limited to, the federal American Recovery and Reinvestment Act of
2009 (Public Law 111-5). This additional funding shall include
federal funds made available due to an increase in the federal
medical assistance percentage in addition to any other increase in
the amount of federal funding.
(d) Any amounts received in the 2008-09, 2009-10, and 2010-11
fiscal years from the federal government pursuant to additional
demonstration project funding as specified in this section shall be
deposited in the Federal Trust Fund. Nothwithstanding Section 28.00
of the Budget Act of 2009, the Department of Finance may authorize
expenditure of these funds in a manner consistent with federal law
and that offsets General Fund expenditures otherwise authorized in
the Budget Act of 2009 for the Medi-Cal program, and as appropriated
in Item 4260-101-0001, or for the Health Care Support Fund. For any
adjustments made under the authority provided for by this section,
the Department of Finance shall provide notification in writing to
the chairperson of the Joint Legislative Budget Committee not less
than 30 days prior to the effective date of the adjustment, or not
sooner than whatever lesser time the chairperson of the Joint
Legislative Budget Committee, or his or her designee, may in each
instance determine. The notification to the chairperson of the joint
committee shall include, at a minimum, the amounts of the proposed
appropriation adjustments, a description of any assumptions used in
making the adjustments, the relevant federal authority, and any other
clarifying description as relevant.
(e) If the federal Centers for Medicare and Medicaid Services or
any federal or state court issues a ruling that any or all federal
dollars obtained by claiming for expenditures from any particular
program referenced in subdivision (b) cannot be used to increase
state revenues, the department may discontinue use of those
expenditures for claiming under this section and substitute other
expenditures from other programs referenced in subdivision (b) at its
discretion.
(f) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, the
department may implement this section by means of a provider
bulletin, or other similar instruction, without taking regulatory
action. The department shall also provide notification to the Joint
Legislative Budget Committee within five working days if that action
is taken in order to inform the Legislature that the action is being
implemented.
SEC. 2. Article 5.4 (commencing with Section 14180) is added to
Chapter 7 of Part 3 of Division 9 of the Welfare and Institutions
Code, to read:
Article 5.4. Health Care Coordination, Improvement, and
Long-Term Cost Containment Waiver or Demonstration Project
14180. (a) The department shall submit an application to the
federal Centers for Medicare and Medicaid Services for a waiver or a
demonstration project to implement all of the following:
(1) Strengthen California's health care safety net, which includes
disproportionate share hospitals, for low-income and vulnerable
Californians.
(2) Maximize opportunities to reduce the number of uninsured
individuals.
(3) Optimize opportunities to increase federal financial
participation and maximize financial resources to address
uncompensated care.
(4) Promote long-term, efficient, and effective use of state and
local funds.
(5) Improve health care quality and outcomes.
(6) Promote home-and community-based care.
(b) The waiver or demonstration project shall include proposals to
restructure the organization and delivery of services to be more
responsive to the health care needs of Medi-Cal enrollees for the
purpose of providing the most vulnerable Medi-Cal beneficiaries with
access to better coordinated and integrated care that will improve
their health outcomes, slow the long-term growth of the Medi-Cal
program, and continue support for the safety net care system and the
persons who rely on that system for needed care. These restructuring
proposals may include, but are not limited to, the following:
(1) Better care coordination for seniors and persons with
disabilities, dual eligibles, children with special health care
needs, and persons with behavioral health conditions, which shall
include the establishment of organized delivery systems that
incorporate a medical home system and care and disease management, as
well as incentives that reward providers and beneficiaries for
achieving the desired clinical, utilization, and cost-specific
outcomes.
(2) Improved coordination between Medicare and Medi-Cal coverage.
(3) Improved coordination of care for children with significant
medical needs through improved integration of delivery systems and
use of medical homes and specialty centers, and providing incentives
for specialty and nonspecialty care.
(4) Improved integration of physical and behavioral health care.
(c) In developing the waiver or demonstration project application,
the department shall consult on a regular basis with interested
stakeholders and the Legislature.
(d) The department shall determine the form of waiver most
appropriate to achieve the purposes listed in subdivision (a).
(e) The department shall submit the waiver or demonstration
project application to the federal Centers for Medicare and Medicaid
Services by a date that allows sufficient time for the waiver or
demonstration project to be approved by no later than September 1,
2010, or the conclusion of any extension period granted in California'
s Medi-Cal Hospital/Uninsured Care Section 1115(a) Medicaid
Demonstration (No. 11-W-00193/9), whichever happens last.
(f) In order to restructure the Medi-Cal program to improve the
delivery of care for specified populations and secure the maximum
amount of federal financial participation allowable, any waiver or
demonstration project application submitted pursuant to subdivision
(a) may specify and seek authority to enroll beneficiaries into
specified organized delivery systems. Subject to federal approval,
the specified organized delivery systems may include the utilization
of an enhanced primary care case management model, a medical home
model, or managed care model. The department is authorized to enroll
beneficiaries in an organized system of care subject to the
conditions in Section 14181. Subject to federal approval, any waiver
or demonstration project application submitted pursuant to
subdivision (a) shall include processes, and accompanying criteria,
by which the department will evaluate and grant exemption, on an
individual basis, from this section's requirements pertaining to the
mandatory enrollment of beneficiaries in specified organized delivery
systems.
(g) (1) The department shall only implement the waiver or
demonstration project upon submittal of an implementation plan,
pursuant to Section 14181, to the appropriate policy and fiscal
committees of the Legislature at least 60 days prior to any
appropriation.
(2) Pursuant to paragraph (1), mandatory enrollment in any
organized delivery system authorized pursuant to a waiver or
demonstration project authorized pursuant to this article shall only
occur when funds necessary to support that effort have been
appropriated.
(3) It is the intent of the Legislature to neither impede nor
limit the department's existing statutory authority regarding the
operation of the Medi-Cal program and its health care delivery
systems by the enactment of this article.
(h) The director shall have the discretion to utilize state plan
amendments, in whole or in part, to accomplish any or all purposes of
this article. In the event the director proceeds with state plan
amendments as specified, the department shall provide notification in
writing to the chairperson of the Joint Legislative Budget Committee
within 15 working days of that action and a brief description and
purpose of the amendment. This amendment shall be made available to
the Joint Legislative Budget Committee upon the request of the
chairperson.
14181. (a) The California Health and Human Services Agency or
successor entity or designated department shall submit an
implementation plan to the appropriate policy and fiscal committees
of the Legislature for implementation of the federally approved
waiver or demonstration project. The implementation plan shall be
developed in consultation with a stakeholder advisory committee
established pursuant to subdivision (b). The implementation plan
shall specifically address the multiple and complex needs of seniors
and persons with disabilities, dual eligibles, children with special
health care needs, and persons with behavioral health conditions, and
the specific strategies the agency or successor entity or designated
department will use to ensure the provision of quality, accessible
health care services under the waiver or demonstration project,
including, at a minimum, the following elements:
(1) Criteria, performance standards, and indicators shall be
adopted to ensure that plan services meet the multiple and complex
needs of beneficiaries and comply with the requirements of this
article. The performance standards shall incorporate, at a minimum,
existing statutory and regulatory requirements and protections
applicable to two-plan model and geographic managed care plans, as
well as those protections available under the Knox-Keene Health Care
Service Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340)
of Division 2 of the Health and Safety Code), but in addition shall
include specific requirements and standards based on the multiple and
complex care needs of seniors and persons with disabilities, dual
eligibles, children with special health care needs, and persons with
behavioral health conditions, including, but not limited to,
standards where applicable to the organized delivery system model in
all of the following areas:
(A) Plan readiness.
(B) Availability and accessibility of services, including physical
access and communication access.
(C) Benefit management and scope of services.
(D) Care coordination and care management.
(E) Beneficiary complaints, grievances, and appeals.
(F) Beneficiary participation.
(G) Continuity of care.
(H) Cultural and linguistic appropriateness.
(I) Financial management.
(J) Measurement and improvement of health outcomes.
(K) Marketing, assignment, enrollment, and disenrollment.
(L) Network capacity, including travel time and distance and
specialty care access.
(M) Performance measurement and improvement.
(N) Provider grievances and appeals.
(O) Quality care.
(P) Recordkeeping and reporting.
(2) Strategies to be used to monitor performance of all
contractors and to ensure compliance with all components of the
waiver or demonstration project.
(3) Provision of a comprehensive timeline of key milestones for
implementation of the waiver or demonstration project components.
(4) Provision of a framework for evaluation of the waiver or
demonstration project, including the process, timelines, and criteria
for evaluating implementation, as well as the method for providing
periodic updates of outcomes and key implementation concerns.
(b) Prior to preparing the implementation plan required by this
section, the agency or successor entity or designated department,
shall convene a stakeholder committee to advise on preparation of the
implementation plan. The stakeholder committee shall include, but
not be limited to, persons with disabilities, seniors, and
representatives of legal services agencies that serve clients in the
affected populations, health plans, specialty care providers,
physicians, hospitals, county government, labor, and others as deemed
appropriate by the agency or successor entity or designated
department. The stakeholder committee shall advise on the
implementation of the waiver or demonstration project until the
expiration of the waiver or demonstration project.
14182. Notwithstanding the Administrative Procedure Act, Chapter
3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government Code, the department may implement the provisions
of this article through all-county welfare director letters or
similar instruction, without taking regulatory action. Prior to
issuing any letter or similar instrument authorized pursuant to this
section, the department shall notify and consult with stakeholders,
including advocates, providers, and beneficiaries, in implementing,
interpreting, or making specific this article.
SEC. 3. This act addresses the fiscal emergency declared by the
Governor by proclamation on July 1, 2009, pursuant to subdivision (f)
of Section 10 of Article IV of the California Constitution.
SEC. 4. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to ensure that health care for Californians is improved
at the earliest possible time, it is necessary for this act to go
into immediate effect.