BILL ANALYSIS                                                                                                                                                                                                    




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                           1445 (Chesbro)
          
          Hearing Date:  8/12/2010        Amended: 6/1/2009
          Consultant: Katie Johnson       Policy Vote: Health 10-0
          _________________________________________________________________ 
          ____
          BILL SUMMARY:  AB 1445 would permit federally qualified health  
          centers and rural health centers to claim reimbursement for  
          multiple visits for a single patient on the same day at the same  
          location, as specified.
          _________________________________________________________________ 
          ____
                            Fiscal Impact (in thousands)

           Major Provisions        2010-11      2011-12       2012-13     Fund
                                                                  
          DHCS implementation      up to $200 up to $300     
          $1,000General/*
          and increased Medi-Cal                                 Federal
          payments to FQHC/RHCs

          *50 percent General Funds, 50 percent federal funds
          _________________________________________________________________ 
          ____

          STAFF COMMENTS: SUSPENSE FILE.

          Federal law allows for the separate reimbursement of same-day  
          medical and mental health visits. However, current state law  
          permits only one visit per day to be reimbursed by Medi-Cal,  
          except for a subsequent visit by a patient to a dental  
          professional with rates determined prospectively. This bill  
          would permit FQHC/RHCs to be reimbursed for medical and mental  
          health visits as two separate visits and would require clinics  
          that currently include the cost of encounters with more than one  
          health professional that take place on the same day at a single  
          location as constituting a single visit to apply to the  
          department for an adjustment of their per-visit rate. This rate  
          redetermination provision is meant to imply that the department  
          would adjust the per-visit rate to make this bill cost neutral. 

          There are 907 FQHC/RHCs in the state and they are reimbursed  
          $160.60 per visit per day under the current reimbursement  










          system. If half of the clinics were to have two additional  
          Medi-Cal visits each month as a result of being able to serve  
          the same person on the same day and bill separately for the two  
          visits, annual costs would be $1.7 million in total funds,   
          commencing January 1, 2012, and thereafter. Since Medi-Cal costs  
          are typically shared 50 percent General Funds and 50 percent,  
          costs would be $850,000 General Fund and $850,000 federal funds.  
          If the redetermination provision were to result in a new per  
          visit rate that would render these additional visits closer to  
          or cost neutral, costs could be considerably less.

          DHCS would also be required to apply for federal approval and  
          would need to amend its state plan in order to draw down federal  
          funds to implement these provisions. DHCS could need up to .5 PY  
          to achieve this in FY 2010-2011 at a cost of approximately  
          $50,000 total funds. Additionally, DHCS could need up to 3  
          limited-term auditors at a 
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          AB 1445 (Chesbro)

          cost of $300,000 in total funds for two years commencing in FY  
          2010-2011, in order to adjust FQHC/RHC rates as provided for in  
          the bill depending on the number of clinics that apply for a  
          rate redetermination. These departmental staffing costs would be  
          shared 50 percent General Fund and 50 percent federal funds. 

          Additionally, staff recommends that the implementation dates in  
          the bill be pushed forward 1 year so they reflect this bill as  
          it would take effect January 1, 2011, instead of assuming a  
          January 1, 2010, effective date, as it currently does.

          In 2007, the Governor vetoed a similar bill, SB 260 (Steinberg),  
          saying, "While I support improving access to health care  
          services, including mental health services, I cannot support  
          this bill as it would increase General Fund pressure at a time  
          of continuing budget challenges. Mental health services are  
          already included in the Medi-Cal rates for federally qualified  
          health centers and rural health clinics. Allowing separate  
          billing for mental health services would lead to increased costs  
          that our state cannot afford."