BILL ANALYSIS Ó SENATE COMMITTEE ON BUDGET AND FISCAL REVIEW Mark Leno, Chair Bill No: AB 1485 Author: Committee on Budget As Amended: June 13, 2012 Consultant: Peggy Collins Fiscal: Yes Hearing Date: June 14, 2012 Subject: Budget Act of 2011: Supplemental Appropriations Summary: This bill appropriates $1.1 billion General Fund to the Department of Corrections and Rehabilitation ($295.4 million), Department of Mental Health ($41.8 million), Department of Health Care Services ($759.6 million), and Mariposa and Lassen counties ($125,436). Background: The Budget Act of 2011 appropriated specific amounts from the General Fund for the support of state government. This bill contains funding necessary to address deficiencies in the 2011 Budget Act. The proposed funding in this measure has been approved by the Department of Finance (DOF) and reviewed by the Joint Legislative Budget Committee (JLBC). Proposed Law: This bill includes the following provisions: 1. Appropriates $295.4 million General Fund to augment the 2011 Budget Act for the Department of Corrections and Rehabilitation (CDCR) to address a shortfall in the Receiver's Medical Services Program. Included in this amount is: a. $163.2 million to address the Receiver's inability to realize the savings associated with a 10 percent unallocated budget reduction included in the 2011 Budget Act; b. $86 million to address a structural deficiency in the pharmaceutical budget; and c. $46.2 million to address increased custody costs related to the transportation of prisoners to and from medical appointments and supervision while at medical appointments. -1- 2. Appropriates $41.8 million General Fund to augment the 2011 Budget Act for the Department of Mental Health (DMH) associated with increased operating costs. Included in the amount is: a. $147.5 million associated with patient-related activities (such as enhanced observation of patients and admission assessments) and costs associated with the redirection of staff toward Civil Rights for Institutionalized Persons Act (CRIPA)-related activities. DMH and the United States Department of Justice entered into a Consent Judgment in 2006 requiring state hospitals to implement numerous corrective actions for CRIPA violations; b. $13.9 million to address costs associated with increased patient caseload related to the Coleman lawsuit settlement which required improved mental health services to CDCR prisoners; and c. $119.6 million in additional savings associated with a decrease in the projected state hospital caseload, implementation of the state hospitals savings plan, and increased reimbursements. 3. Appropriates $759.6 million General Fund to augment the 2011 Budget Act for the Department of Health Care Services (DHCS) for costs primarily associated with unrealized savings anticipated by the 2011 Budget Act. These include: a. $346.8 million to address costs associated with a court injunction barring the implementation of provider rate reductions; b. $511.1 million to address costs associated with the failure to obtain federal approval to implement copayments in the Medi-Cal program; and c. $98.3 million in various adjustments within the Medi-Cal local assistance budget that result in a net savings. 4. Appropriates $125,436 General Fund to counties requesting reimbursement of qualified homicide trial costs. These claims have been approved by the State -2- Controller. Included in this amount is: a. $6,508 to Mariposa County for the case of "People v. Cary Stayner;" and b. $118,928 to Lassen County for the cases of "People v. Joanna Lynne McElrath" and "People v. Robin Glenn James." Fiscal Effect: Appropriates $1.1 billion General Fund in the current year. This appropriation is assumed in the proposed 2012 Budget Act. Any unencumbered funds will revert to the General Fund. Support: None on file Opposed: None on file -3-