BILL ANALYSIS Ó
AB 1467
Page 1
( Without Reference to File )
CONCURRENCE IN SENATE AMENDMENTS
AB 1467 (Budget Committee)
As Amended June 13, 2012
Majority vote. Budget Bill Appropriation Takes Effect
Immediately
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|ASSEMBLY: | |(March 22, |SENATE: |24-14|(June 15, |
| | |2012) | | |2012) |
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(vote not relevant)
Original Committee Reference: BUDGET
SUMMARY : Contains necessary statutory changes to achieve
savings assumed in the 2012 Budget Act for the California Health
and Human Services Agency, Department of Health Care Services
(DHCS), Department of Public Health, Office of Statewide Health
Planning and Development, and the California Health Facilities
Financing Authority (CHFFA).
The Senate amendments delete the Assembly version of this bill,
and instead:
1)Delete obsolete language from Government Code Section 12803.3
that prevents the Office of Systems Integration (OSI) from
managing the California Healthcare Eligibility Enrollment and
Retention System (CalHEERS) project.
2)Extend the sunset on the Office of HIPAA (Health Insurance
Portability and Accountability Act) Implementation (CalOHI) to
June 30, 2016.
3)Create the Long-Term Care Quality Assurance Fund to collect
revenue from the skilled nursing facilities quality assurance
fee, which may be used, upon appropriation by the Legislature,
for the purposes established in statute associated with the
quality assurance fee.
4)Change, in order to achieve $94.5 million in General Fund
savings through the 2012 Budget Act, the payment methodology
to Non-Designated Public Hospitals (NDPHs) to a Certified
Public Expenditure (CPE) methodology. Under the CPE
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methodology, the NDPHs shall no longer receive state General
Fund, and instead will certify the cost of providing inpatient
services to fee-for-service Medi-Cal beneficiaries in order to
receive as reimbursement the federal share of those
expenditures. Authorizes DHCS to seek approval of an
amendment to the 1115 Bridge To Reform (BTR) Waiver from
Centers for Medicare and Medicaid Services (CMS) to increase
Safety Net Care Pool (SNCP) Uncompensated Care and Delivery
System Reform Incentive Pool (DSRIP) funding available to
NDPHs, to replace state General Fund. Exempts NDPHs from the
diagnosis-related group payment methodology. This new
methodology shall be subject to federal approvals and
retroactive to July 1, 2012.
5)Redirect, to achieve $150 million in General Fund savings,
$150 million in hospital fee revenue in 2012-13 (currently
intended to fund increased rates to managed care plans for
them to increase payments to hospitals) to instead offset
General Fund expenditures for providing health coverage to
children. The increased rates would have funded supplemental
payments to private hospitals by the managed care plans.
Eliminates direct grants to designated public hospitals in
2013-14 and would instead use the funds for children's health
coverage under Medi-Cal.
6)Roll over to achieve $100 million in General Fund savings,
unspent Health Care Coverage Initiative (HCCI) funding into
the Safety Net Care Pool Uncompensated Care (SNCP) component
and splits the funding between the state and Designated Public
Hospitals (DPHs). Authorizes DPHs to voluntarily utilize
their CPEs to claim the additional SNCP funding with specified
conditions. As a condition of utilizing their CPE to claim
the additional federal funding, requires that the DPHs allow
the state to retain 50% of the federal funding attributable to
the HCCI rollover.
7)Allow part of the hospital fee revenue to be paid without all
components of the fee having been approved by the federal CMS
in order to improve accounting procedures for hospitals.
8)Provide a six-month extension (from March 2012 to September
2012) by which hospitals need to notify the state on plans for
seismic retrofitting and a schedule detailing why a requested
extension is necessary.
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9)State, to achieve $7.7 million in General Fund savings, that
the Legislature's intent to develop new payment rates for
clinical laboratory services that are comparable to the
payment amounts received from other payers of services.
Provides that reimbursement for laboratory services shall not
exceed the lowest of the following: a) the amount billed; b)
the charge to the general public; c) 80% of the lowest maximum
allowance established by the federal Medicare Program for the
same or similar services; or, d) a reimbursement rate based on
an average of the lowest amount that other payers and other
state Medicaid programs pay for similar services. Imposes a
10% rate reduction for laboratory services beginning July 1,
2012, and continuing until this new rate methodology has
received federal approval. Establishes rate data reporting
requirements for laboratories to the state to be utilized for
developing the new rate methodology. Requires DHCS to seek
stakeholder input in the development of the rate methodology.
10)Create a Deputy Director position at the DHCS to oversee
mental health and substance use disorder services, programs
and functions.
11)Move the Caregiver Resource Centers program from the
Department of Mental Health (DMH) to the DHCS.
12)Provide clarification and detail on county mental health
innovative programs. Specifically, requires innovative
programs to address one of several specified purposes,
requires that they support innovative approaches as specified,
and clarifies that an innovative project may affect any aspect
of mental health practices.
13)Transition the oversight of mental health prevention and
early intervention services from the DMH to the DHCS, and
requires DHCS to oversee these services in coordination with
counties.
14)Transition various functions related to the Mental Health
Oversight and Accountability Commission from the DMH to the
DHCS.
15)Require, related to currently-required three-year plans,
county mental health programs to submit annual updates adopted
by the county board of supervisors to the Mental Health
Services Oversight and Accountability Commission (MHSOAC).
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Specifies that the three-year program and expenditure plan
shall be based on available unspent funds and estimated
revenue provided by the state and with stakeholder engagement.
16)Require DHCS to annually inform the California Mental Health
Directors Association (CMHDA) and the MHSOAC of the
methodology used for revenue allocation to counties.
17)Require DHCS, in consultation with the MHSOAC and the CMHDA,
to develop and administer instructions for the Annual Mental
Health Services Act Revenue and Expenditure Reports, and
specifies the purpose of the reports.
18)Authorize DHCS to contract with managed care plans for the
delivery of Medi-Cal services in 28 counties that are
currently fee-for-services only in Medi-Cal. Directs DHCS, in
contracting, to give special consideration to managed care
health plans that: a) have demonstrated experience in serving
Medi-Cal beneficiaries, effectively partnering with public and
traditional safety net health care providers, and working with
stakeholders and others; b) have the lowest administrative
costs; c) have support from local county officials; and, d)
offer a quality improvement program for primary care
providers. Plans must be in good financial standing and meet
licensure requirements under the Knox-Keene Health Care
Service Plan Act, and shall provide access to providers in
compliance with state and federal laws. Requires DHCS to
conduct a stakeholder process to provide input into the
delivery model for these counties. Authorizes DHCS to adopt
emergency regulations to implement this section of law.
Requires DHCS to provide quarterly updates to the Legislature
on the implementation of this managed care expansion.
19)State the Legislature's intent to improve access to oral
health and dental care services provided to Medi-Cal
beneficiaries in dental health managed care plans in
Sacramento and Los Angeles Counties by implementing
performance contracting and a beneficiary dental exception
process for Medi-Cal beneficiaries to access dental care
through fee-for-service. Requires DHCS to establish a
beneficiary dental exception process for beneficiaries
mandatorily enrolled in dental managed care plans, which shall
be in effect as long as mandatory enrollment for dental care
is in effect in Sacramento. Specifies the operations of this
exception process.
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20)Authorize Sacramento County to establish a stakeholder
advisory committee to provide input on the delivery of oral
health and dental care services. Specifies the members and
basic operations of such an advisory committee. Requires DHCS
to meet quarterly with the advisory committee.
21)Require DHCS to establish a list of performance measures for
dental health plans to meet quality criteria and post this
list and each plan's performance on the department's Web site.
Specifies what the performance measures shall include, such
as provider network adequacy, overall utilization, use of
preventive services, and many others. Requires DHCS to amend
contracts with dental health plans to meet new requirements
contained in this bill.
22)Require DHCS to designate an external quality review
organization to conduct external quality reviews of dental
health plans contracting with the Medi-Cal program. Requires
each dental plan to submit its marketing plan, member services
procedures, and beneficiary informational materials to the
department for review and approval.
23)Require DHCS to provide annual updates to the Legislature on
dental managed care in Sacramento and Los Angeles Counties,
and specifies the required content of these reports.
24)Require the DHCS to assess interest against Medi-Cal provider
overpayments at the higher of the Surplus Money Investment
Fund (SMIF) rate; or, 7% per year. Requires the DHCS to pay
interest at the same rate to a provider who prevails in an
appeal of a payment disallowed by the DHCS.
25)Change how DHCS selects a default managed care plan when a
Medi-Cal enrollee does not make a health plan selection.
Specifically, the algorithm will be based on health plan cost
in addition to quality of care and safety net population
factors. Requires the default algorithm to be adjusted to
increase defaults to low cost plans by 5%. Includes the
following clarifying language: "With respect to implementing
any changes to the default mechanism for assigning Medi-Cal
managed care enrollees that would add a cost performance
measure, the department shall consult the stakeholder
workgroup to develop a cost factor that disregards costs
related to intergovernmental transfer-funded payments and
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required wraparound payments that support safety net
providers."
26)Add a sunset date of June 30, 2013, for specified obsolete
special funds. These funds were originally established to
supply funds for the nonfederal share of supplemental payments
to Disproportionate Share Hospitals. The funding mechanism
for the nonfederal portion of these supplemental payments has
changed since the establishment of the funds.
27)Extend the Rogers Amendment sunset date from January 1, 2013,
to July 1, 2013, for capitation rates (known as Rogers Rates)
paid to non-contract hospitals for emergency inpatient and
post-stabilization services provided to Medi-Cal managed care
plan enrollees. Enacted as part of the Deficit Reduction Act
of 2005, the Roger's Amendment sets a limit on the amount that
a Medicaid (Medi-Cal) managed care plan can reimburse a
non-contracted hospital that provides emergency services to
one of the plan's members. It requires hospitals to accept,
as payment in full, no more than the amounts that it could
collect under the fee-for-service Medicaid program. In 2008,
California enacted Welfare and Institutions Code Section
14091.3, which sets the rate methodology for non-contracted
emergency inpatient services and non-contracted
post-stabilization services, thereby implementing the federal
Roger's Amendment. The Rogers Rates shall be in effect only
until implementation of the diagnosis-related groups payment
methodology.
28)Require, to comply with requirements of the federal
Affordable Care Act, Medi-Cal to increase certain physician
primary care service rates to no less than 100% of the
Medicare rate for specific services beginning January 1, 2013.
This enhanced reimbursement applies to physicians with a
primary specialty designation of family medicine, general
internal medicine, and pediatric medicine. Sunsets this
increase in payments on December 31, 2014.
29)Require, to achieve approximately $12.2 million in General
Fund savings through the 2012 Budget Act, all services
assessed and determined to be educationally related by an
individualized education program (IEP) team, and contained in
the child's IEP, to be provided in accordance with the federal
Individuals with Disabilities Education Act, and prohibits the
California Children Services (CCS) program from paying for
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these services for these children. Requires parents to
disclose to the CCS program their child's IEP, if the child
has one, at the time of application to the CCS program, and
when the IEP has been revised.
30)Make definitions of "nonemergency services" in an emergency
room the same across various statutes, in order to facilitate
the implementation of a copayment in Medi-Cal for nonemergency
services in emergency rooms, in order to achieve $20.2 million
in General Fund savings.
31)Suspend the annual Cost of Living Adjustment to counties for
conducting Medi-Cal eligibility functions.
32)Transfer state employees, resources and authority from the
California Medical Assistance Commission to DHCS on July 1,
2012, to continue working on the Selective Provider
Contracting Program until the diagnosis-related group payment
system is implemented.
33)Allow up to $200,000 in General Fund to be used as the
required 10% match by the state in order to draw down a 90%
federal funding match from the federal CMS for administration
of the Medi-Cal Electronic Health Record Incentive Payment
Program.
34)Authorize the Director of Finance to approve no more than
$100 million General Fund in cash flow loans in fiscal years
2012-13 and 2013-14 for County Medical Services Program (CMSP)
Governing Board expenditures associated with a Low-Income
Health Program operated by the CMSP Governing Board. Any cash
flow loans made would be considered short term and would not
constitute General Fund expenditures.
35)Authorize capitation rates for Low-Income Health Programs to
be implemented for the current demonstration year, regardless
of the date upon which they are approved by the federal
government.
36)Require, by August 1, 2012, the Department of Public Health,
in collaboration with DHCS, to provide guidance on the
transfer of clients living with HIV/AIDS from Ryan White
funded programs to the Low Income Health Program (LIHP).
Requires this guidance to be provided to LIHP participating
counties, providers, and clients as applicable. The guidance
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shall minimize disruption of services to clients. Requires
the Department of Public Health and DHCS to consult with
community representatives to obtain expert advice on policy
decisions regarding the transition of clients living with
HIV/AIDS from Ryan White funded programs to LIHP.
37)Eliminate the defunct Genetically Handicapped Persons Program
Advisory Committee.
38)Establish the Office of Health Equity (OHE) within the
Department of Public Health to achieve the highest level of
health and mental health for all people with a focus on
socioeconomically disadvantaged populations, including
vulnerable and isolated communities. The OHE will seek to
eliminate health and mental health disparities and inequities.
Establishes the duties and organization of the OHE.
Incorporates the functions and missions of the Office of
Women's Health (within DHCS) and the Office of Multicultural
Services (within DMH).
39)Transfer the Every Woman Counts Program, the Prostate Cancer
Treatment Program, and the Family Planning Access Care and
Treatment Program from the Department of Public Health to the
DHCS.
40)Eliminate the Retail Food Safety and Defense Fund and
authorizes fee revenue from the retail food industry for
mandated activities, including review and approval of Hazard
Analysis Critical Control Point Plans, equipment variances,
and modified atmosphere packaging proposals to be deposited
into the Food Safety Fund.
41)Repeal statutory requirements that have been met by the
Department of Public Health that authorize counties to collect
a $6 fee from owners of public swimming pools, and send most
of this revenue to the state for activities related to
improving public swimming pool safety. The original
legislation included a sunset of 2014 and the department has
met its obligations under this statute.
42)Require the Department of Public Health to report to the
Joint Legislative Budget Committee by October 1, 2012, on if
any of the projections or assumptions used to develop the AIDS
Drug Assistance Program (ADAP) estimate for the Budget Act of
2012-13 may result in a potential funding shortfall or an
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inability of ADAP to provide services to eligible ADAP
clients.
43)Move the Mental Health Services Act (MHSA) Workforce
Education and Training Program from the Department of Mental
Health to the Office of Statewide Health Planning and
Development.
44)Create a competitive grant program within the California
Health Facilities Financing Authority (CHFFA) for one or more
projects to demonstrate new or enhanced methods of delivering
health care services to improve access and health outcomes for
vulnerable populations or communities, or both, that are
effective at enhancing health outcomes and improving access to
quality health care and preventive services. Grants may be up
to $1.5 million. Creates the California Health Access Model
Program Account and transfers up to $6.5 million in this
account from the CHFFA Fund for this purpose. Any funds not
awarded as a competitive grant would revert back to the CHFFA
Fund balance on January 1, 2020.
45) Add an appropriation allowing this bill to take effect
immediately upon enactment.
AS PASSED BY THE ASSEMBLY , this bill expressed the intent of the
Legislature to enact statutory changes relating to the Budget
Act of 2012.
Analysis Prepared by : Andrea Margolis / BUDGET / (916)
319-2099
FN: 0004088