BILL ANALYSIS Ó
AB 102
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CONCURRENCE IN SENATE AMENDMENTS
AB 102 (Budget Committee)
As Amended June 8, 2011
Majority vote. Budget Bill Appropriation Takes Effect Immediately
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|ASSEMBLY: | |(February 22, |SENATE: |24-15|(June 10, 2011) |
| | |2011) | | | |
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(vote not relevant)
SUMMARY : Contains necessary statutory changes to achieve savings
assumed in the 2011 Budget Act for the Department of Health Care
Services (DHCS), Department of Mental Health (DMH), Department of
Public Health (DPH), and the Managed Risk Medical Insurance Board
(MRMIB).
The Senate amendments delete the Assembly version of this bill, and
instead:
1)Make the following changes within the DHCS (Medi-Cal program):
a) California Medical Assistance Commission Elimination:
i) Eliminates the California Medical Assistance Commission
(CMAC) on June 30, 2012, and transfers all powers, duties,
responsibilities and staff of the commission to the DHCS;
ii) Requires the DHCS to consult with the Department of
Finance, the CMAC, and the Department of Personnel
Administration to develop a staff transition plan to be
included in the 2012-13 Governor's Budget;
iii) Eliminates all powers, duties and responsibilities of
the commission, including that which has been transferred to
the DHCS, upon a determination by the Director of the DHCS
that a diagnosis-related groups payment system is sufficient
to replace the contract-based payment system facilitated by
the CMAC; and,
iv) Requires the DHCS to implement the diagnosis related
groups (DRG) payment system either on July 1, 2012 or, if
federal approvals have not been obtained by that date, upon
declaration that federal approvals have been obtained.
b) Certified Public Expenditures (CPE):
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i) Directs the DHCS to annually seek authority from the
federal Centers for Medicare and Medicaid Services (CMS),
under the Bridge to Reform 1115 Demonstration waiver, to
redirect to the Safety Net Care Pool (SNCP) any unused
portion of the funds designated for the Health Care Coverage
Initiative program;
ii) Authorizes Designated Public Hospitals (DPHs) to utilize
excess certified public expenditures to claim the redirected
SNCP funds;
iii) Directs DPHs to allow that for every dollar of excess
CPE used by the DPHs, the DPHs will voluntarily allow the
state to use a corresponding excess CPE for claiming federal
funds;
iv) Limits the amount of excess CPEs that the state can use
to the amount necessary to enable the state to receive total
SNCP uncompensated care funds for Designated State Health
Programs, and allows DPHs to claim all remaining excess CPEs
in excess of the amount available to the state;
v) Requires the DHCS to consult with the DPHs on the
availability of excess CPEs and the appropriate allocation of
redirected SNCP funds; and,
vi) Requires a DPH to be solely responsible for the
repayment of the federal portion of any federal disallowance
or deferral related to claiming a CPE, and stipulates other
requirements and responsibilities of the state and DPHs for
additional federal disallowances or deferrals.
c) Inter-Governmental Transfers Fee:
i) Authorizes the DHCS to assess a 20% fee on each
voluntary Inter-Governmental Transfer (IGT) that is used to
match federal funds (to provide Medi-Cal Managed Care rate
increases) to cover administrative costs of operating the IGT
program; and,
ii) Limits the assessment of the 20% fee to those made by a
governmental entity to provide the non-federal share of "rate
range increases" (as defined).
d) County Administration Budgeting Methodology:
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i) Requires the DHCS to develop and implement, in
consultation with counties, a new budgeting methodology for
Medi-Cal county administrative costs, to be used to reimburse
counties for eligibility determinations for Medi-Cal
applicants and beneficiaries;
ii) Requires the new methodology to include identification
of the costs of eligibility determinations for applicants,
and for eligibility redeterminations and case maintenance
activities, for various groupings of cases;
iii) Requires the new methodology to be clearly described,
state the necessary data elements to be collected from the
counties, and establish the time frames for counties to
provide the data to the state;
iv) Authorizes the DHCS to develop a process for counties to
phase in the new methodology; and,
v) Requires the DHCS to provide the new methodology to the
Legislature by March 1, 2012 and authorizes the
Administration to include it in the May Medi-Cal Local
Assistance Estimate for the 2012-13 Fiscal Year and each year
thereafter.
e) Pharmacy Reimbursement Methodology:
i) Authorizes the DHCS to develop a new Medi-Cal
reimbursement methodology for pharmacies based on Average
Acquisition Price.
f) 10% Provider Rate Reduction Technical Corrections:
i) Makes clarifying adjustments to AB 97 (Budget
Committee), Chapter 3, Statutes of 2011, which included a 10%
rate reduction to nearly all Medi-Cal providers. These
corrections ensure that the existing 1% and 5% rate
reductions remain in place until the implementation of the
10% reduction that was approved in March 2011.
2) Shift the Mental Health Managed Care and the Early and
Periodic Screening, Diagnosis, and Treatment (EPSDT) Programs
from the Department of Mental Health (DMH) to the DHCS:
a) Requires the transfer of state administrative functions for
the operation of the Medi-Cal Specialty Mental Health Managed
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Care program and EPSDT Program from the DMH to the DHCS.
b) Requires the DHCS and DMH to jointly convene stakeholder
meetings and forums to receive input concerning the transition
of these programs to the DHCS in order to help develop a
programmatic transition plan that shall address:
i) Continued access to, and quality of, services during and
after the transition, and prevention of disruptions in
services;
ii) A detailed description of functions currently performed
by the DMH; and,
iii) Operational steps, timelines and key milestones for
determining when and how each function will be transferred.
c) Requires the Administration to develop a transition plan and
initially provide it to the Legislature by October 1, 2011.
Requires the transition plan to be updated, completed, and
provided to the Legislature by May 15, 2012.
3) Revise provisions relating to Access for Infants and Mothers
(AIM) and Healthy Families Fee For Service Reimbursement
Systems:
a) Authorizes the use of the Medi-Cal Fee for Service system to
deliver services in the AIM program which provides low-cost
insurance coverage to uninsured and under-insured low-income
pregnant women with family incomes up to 300% of the federal
poverty level.
b) Makes clarifying and conforming changes to statute that was
adopted in the 2010 budget health trailer bill which authorized
the MRMIB to enter into an interagency agreement with the DHCS
in order to offer fee-for-service Medi-Cal to Healthy Families
enrollees in counties where there is only one managed care plan
option. These provisions conform state law to federal
Children's Health Insurance Program Reauthorization Act
(CHIPRA) law that requires state Children's Health Insurance
Program (CHIP) programs to offer all enrollees a choice of at
least two health plans.
3)Add an urgency clause allowing this bill to take effect
immediately upon enactment.
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AS PASSED BY THE ASSEMBLY , this bill expresses the intent of the
Legislature to enact statutory changes relating to the 2011 Budget
Act.
Analysis Prepared by : Andrea Margolis / BUDGET / (916) 319-2099FN:
0001235