BILL ANALYSIS                                                                                                                                                                                                    Ó






                                  SENATE HUMAN
                               SERVICES COMMITTEE
                          Senator Leland Y. Yee, Chair


          BILL NO:       SB 468                                       
          S
          AUTHOR:        Emmerson                                     
          B
          VERSION:       April 15, 2013
          HEARING DATE:  April 23, 2013                               
          4
          FISCAL:        Yes                                          
          6
                                                                      
          8
          CONSULTANT:     Mareva Brown                               

                                        

                                     SUBJECT
                                         
              Developmental services: statewide Self-Determination  
                                    Program

                                     SUMMARY  

          This bill requires the Department of Developmental Services  
          (DDS) to implement a statewide Self-Determination Program  
          to provide participants and their families with an  
          individual budget to purchase service and supports  
          necessary to implement the consumer's Individual Program  
          Plan. Implementation is contingent upon federal funding.   
          Requires program participants to agree to manage  
          self-determination services within the individual budget  
          amount and with the assistance of an independent financial  
          manager, vendorized by the regional center, among other  
          agreements. Requires the State Council on Developmental  
          Disabilities to issue to the Legislature a report on the  
          program and requires DDS to report data on the program to  
          the Legislature, as specified. 


                                     ABSTRACT  
           

                                                         Continued---




          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageB


          
           Existing law:
           
             1)   Establishes the Lanterman Developmental  
               Disabilities Services Act, which declares California's  
               responsibility for providing an array of services and  
               supports to meet the needs of each person with  
               developmental disabilities in the least restrictive  
               environment, regardless of age or degree of  
               disability, and to support their integration into the  
               mainstream life of the community. (WIC 4500, et seq.)  

              2)   Establishes a system of nonprofit Regional Centers  
               to provide fixed points of contact in the community  
               for all persons with developmental disabilities and  
               their families, to coordinate services and supports  
               best suited to them throughout their lifetime. (WIC  
               4620)  

              3)   Establishes an Individual Program Plan (IPP) and  
               defines that planning process as the vehicle to ensure  
               that services and supports are customized to meet the  
               needs of consumers who are served by regional centers.  
               (WIC 4512)  
                 
              4)   Establishes, contingent upon approval of a federal  
               waiver, the Self-Directed Services Program (SDS  
               Program) statewide to provide participants, within an  
               individual budget, greater control over needed  
               services and supports. (WIC 4685.7)  
                 
              5)   Defines the duties of a financial services manager,  
               and other support personnel; provides a definition of  
               the types of services available through an individual  
               budget; identifies the purpose and formula for funding  
               a risk pool to cover unanticipated expenses, and other  
               elements of the program, as specified. (WIC 4685.7)

             6)   Establishes that a consumer may choose between one  
               of two individual budget amounts and requires that  
               methodologies for determining those two budgets  
               amounts be detailed in departmental regulations, as  
               follows:

                  a.        One individual budget amount shall equal  
                    90 percent of the annual purchase of services  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageC


          
                    costs for the individual. The annual costs shall  
                    reflect the average annual costs for the previous  
                    two fiscal years for the individual.

                  b.        One individual budget amount shall equal  
                    90 percent of the annual per capita purchase of  
                    service costs for the previous two fiscal years  
                    for consumers with similar characteristics, who  
                    do not receive services through the SDS Program,  
                    based on factors including, but not limited to,  
                    age, type of residence, type of disability and  
                    ability, functional skills, and whether the  
                    individual is in transition. This budget  
                    methodology shall be constructed using data  
                    available from DDS, as specified.

             7)   Defines the categories of services that an  
               individual may fund through the individual budget to  
               include community living, health and clinical  
               services, employment, training and education,  
               environmental and medical supports and transportation.  


             8)   Provides that an individual who is determined to be  
               ineligible, or who voluntarily exits the SDS Program,  
               shall be permitted to return to the SDS Program upon  
               meeting all applicable eligibility criteria and after  
               a minimum of 12 months' time has elapsed.

             9)   Creates other requirements and guidelines, as  
               specified, for the program.

           This bill:
           
             1)   Makes a series of Legislative findings and  
               declarations about the efficacy of and need for  
               self-determination services and the intent that the  
               program will continue after the initial three-year  
               phase-in of the program. 

             2)   Requires DDS to implement a statewide  
               Self-Determination Program to provide participants and  
               their families with an individualized budget that  
               provides increased flexibility and choice, greater  
               control over decisions, resources and desired  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageD


          
               services, as specified.

             3)   Requires that the program be phased in over three  
               years, initially serving up to 2,500 regional center  
               consumers and thereafter to be available on a  
               voluntary basis to all regional center consumers. 

             4)   Requires DDS to ensure the following:

                  a.        Self-Determination is a choice for up to  
                    2,500 regional center consumers.
                  b.        Participants reflect the diversity of  
                    disability, ethnicity and geography of the state.
                  c.        The program is cost-neutral in the  
                    aggregate.
                  d.        A statewide method of administration and  
                    of determining comparable services.
                  e.        Oversight of the self-determined funds  
                    and achievement of consumer outcomes over time.
                  f.        Increased consumer and family control  
                    over which services best meet their needs and the  
                    IPP objectives.
                  g.        Comprehensive person-centered planning,  
                    including an individual budget and services that  
                    are outcome-based.
                  h.        Consumer and family training to ensure  
                    understanding of the planning process and  
                    management of budgets, services and staff.
                  i.        A choice of independent facilitators who  
                    can assist with the person-centered planning  
                    process and financial management services  
                    providers who can assist with payments and  
                    provide employee-related services.
                  j.        Innovation that will more effectively  
                    allow consumers to achieve their goals.

             5)   Defines the following terms related to  
               Self-Determination Services:

                  a.        "Financial management services" means a  
                    service to manage and direct the distribution of  
                    funds contained in the individual budget, as  
                    specified. The department shall establish  
                    specific qualifications that shall be required of  
                    a financial management services provider.





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageE


          
                  b.         "Independent facilitator" means a  
                    person, selected and directed by the participant,  
                    who may assist the participant in making informed  
                    decisions about the individual budget, and in  
                    locating, accessing, and coordinating services  
                    consistent with the participant's IPP, as  
                    specified.
                  c.        "Individual budget" means the funding  
                    available to the participant to purchase services  
                    necessary to implement the IPP. The individual  
                    budget shall be constructed using a fair,  
                    equitable, and transparent methodology.
                  d.        "IPP" means individual program plan.
                  e.         "Participant" means an individual, and  
                    when appropriate, his or her parents, legal  
                    guardian or conservator, or authorized  
                    representative, who has been deemed eligible for,  
                    and has voluntarily agreed to participate in, the  
                    Self-Determination Program.
                  f.         "Self-determination" means a voluntary  
                    delivery system consisting of a defined and  
                    comprehensive mix of services and supports,  
                    selected and directed by a participant through  
                    person-centered planning, in order to meet all or  
                    some of the objectives in his or her IPP. 

             6)   Establishes that the Self-Determination Program  
               shall only fund services and supports that are  
               approved by the federal Center for Medicare and  
               Medicaid Services.

             7)   Requires that participation in the  
               Self-Determination Program be fully voluntary and be  
               available to any eligible regional center consumer. A  
               consumer may choose to participate in, and may choose  
               to leave, the program at any time. A regional center  
               may not require or prohibit participation as a  
               condition of eligibility services and supports  
               otherwise available under this division. 

             8)   Defines eligibility for the program as follows:

                  a.        The participant is three years of age or  
                    older.
                  b.        The participant has a developmental  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageF


          
                    disability, as defined in Section 4512.
                  c.        The participant does not live in a  
                    licensed long-term health care facility, as  
                    defined. 

             9)   Requires that an individual who is not eligible to  
               participate in the Self-Determination Program because  
               they live in a long-term health care may request that  
               the regional center make arrangements for transition  
               to the Self-Determination Program, as specified. In  
               that case, the regional center shall initiate  
               person-centered planning services within 60 days of  
               that request.

             10)  Requires a participant to agree to all of the  
               following terms and conditions:

                  a.        Receive an orientation to the  
                    Self-Determination Program prior to enrollment.
                  b.        Agree to utilize the services and  
                    supports available within the Self-Determination  
                    Program only when generic services and supports  
                    cannot be accessed.
                  c.        Use only services and supports necessary  
                    to implement his or her IPP and shall agree to  
                    comply with any and all other terms and  
                    conditions for participation in the  
                    Self-Determination Program, as specified.
                  d.        Shall manage Self-Determination Program  
                    services and supports within the individual  
                    budget amount.
                  e.        Must use the services of the  
                    conflict-of-interest-free financial management  
                    services provider of his or her own choosing.
                  f.        May use the services of a  
                    conflict-of-interest-free independent facilitator  
                    of his or her own choosing, as specified. The  
                    financial management services provider shall  
                    determine that the independent facilitator is  
                    adequately trained and otherwise qualified.

             11)  Requires that a participant who is not Medi-Cal  
               eligible may participate in the Self-Determination  
               Program and receive self-determination services and  
               supports if all other program eligibility requirements  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageG


          
               are met.

             12)  Requires that individuals who are participating in  
               the 1998 self-directed pilot project be included in  
               the new Self-Determination Project, and that a  
               consumer who elects to participate in the  
               Self-Determination Project may transfer to another  
               regional center without losing the right to  
               participate in the program.

             13)  Requires that when a participant exits the program,  
               either voluntarily or because a regional center  
               determines that a participant is no longer eligible to  
               continue, the regional center shall provide for the  
               participant's transition from the Self-Determination  
               Program to other services and supports, including  
               developing a new IPP.

             14)  Requires that if a participant exits the program,  
               the regional center ensures that there is no gap in  
               services and supports during the transition period.

             15)  Requires that a participant who exits the program  
               for any reason be permitted to return upon meeting  
               eligibility criteria and approval of the IPP team, as  
               specified.

             16)  Requires that a consumer's IPP team detail the  
               goals and objectives that are to be met through  
               participant-selected services and design the  
               individual budget to ensure it helps participants  
               achieve the outcomes set forth the IPP, as specified.   
               The completed individual budget shall be attached to  
               the IPP.

             17)  Requires that the participant shall implement his  
               or her IPP, including choosing the services and  
               supports, as specified.

             18)  Exempts participants from the Family Cost  
               Participation Program and other cost control  
               restrictions, including purchases of services that  
               were suspended in the 2009 budget, rate reductions,  
               and others, as specified.  Bars a regional center from  
               prohibiting the purchase of any service or support  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageH


          
               that is otherwise allowable.

             19)  Requires that a participant have all the appeal  
               rights established under WIC 4700.

             20)  Requires DDS, in consultation with stakeholders, to  
               develop a methodology that ensures individual budgets  
               are computed in a fair, transparent, and equitable  
               manner and are based on consumer characteristics and  
               needs, and a method for adjusting individual budgets  
               to address a participant's unanticipated needs. 

             21)  Requires the department to ensure that budgets of  
               all participants are cost neutral in the aggregate.

             22)  Requires the regional center's IPP team, using the  
               methodology developed by DDS and the stakeholders, to  
               determine the individual budget for the participant.

             23)  Requires that the individual budget amount be  
               available to the participant each year until a new  
               individual budget has been determined and provides  
               that an individual budget be calculated no more than  
               once in a 12-month period, unless revised to reflect  
               the unanticipated needs of the participant. 

             24)  Requires that the individual budget be distributed  
               among uniform budget categories developed by the DDS  
               in consultation with stakeholders.

             25)  Permits participants to transfer up to 20 percent  
               of the funds originally distributed to any budget  
               category, as defined, to another budget category or  
               categories, as specified, and permits regional centers  
               or the IPP team to deny a transfer only if necessary  
               to protect the health and safety of the participant.

             26)  Requires an IPP team to annually ascertain from the  
               participant whether there are any circumstances that  
               require a change to the annual individual budget. 

             27)  Requires DDS to apply on or before March 1, 2014,  
               for federal Medicaid funding for the  
               Self-Determination Program by applying for a state  
               plan amendment, an amendment to a current home- and  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageI


          
               community-based waiver for individuals with  
               developmental disabilities, for a new waiver, or by  
               seeking to maximize federal financial participation  
               through other means. 

             28)  Provides that the establishment of the  
               Self-Determination Program shall be contingent upon  
               federal funding. 

             29)  Requires DDS, in consultation with stakeholders, to  
               develop informational materials about the  
               Self-Determination Program, as specified.

             30)  Requires that each regional center's implementation  
               of the Self-Determination Program be included in its  
               contract with DDS and contain these requirements: 

                  a.        Contract with local or family-run  
                    consumer organizations to conduct outreach and  
                    training, as specified.
                  b.        Advance funds to a financial management  
                    services provider to facilitate participation in  
                    the program, as determined by a participant's IPP  
                    team.
                
             31)  Requires the financial management services provider  
               to give the participant and regional center, as  
               specified, with a monthly individual budget statement  
               describing the funds allocated by budget category, the  
               amount spent in the previous 30-day period, and the  
               amount of funding that remains available.

             32)  Requires that only the financial management  
               services provider must apply for vendorization, as  
               specified. All other service providers shall have  
               applicable state licenses, certifications, or other  
               state required documentation, but are exempt from the  
               vendorization requirements. 

             33)  Requires the financial management services provider  
               to ensure and document that all service providers meet  
               specified requirements for any service that may be  
               delivered to the participant.

             34)  Requires that if a participant chooses to request a  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageJ


          
               criminal history background checks for persons seeking  
               employment as a provider of services and supports and  
               providing direct care services and supports to the  
               participant that the check be provided cost-free and  
               according to current law, as specified.

             35)  Requires each regional center to establish a local  
               advisory committee to provide oversight of the  
               Self-Determination Program, as specified.

             36)   Requires DDS to annually provide data to the  
               legislature beginning January 10, 2016, as specified,  
               including: 

                  a.        Number and characteristics of  
                    participants, by regional center.
                  b.        Types and ranking of services and  
                    supports purchased under the Self-Determination  
                    Program, by regional center
                  c.        Range and average of individual budgets,  
                    by regional center, including adjustments to the  
                    budget to address unanticipated need.
                  d.        Participant satisfaction, as specified.
                  e.        The number and outcome of individual  
                    budget appeals and fair hearing appeals by  
                    regional center.
                  f.        The number of participants who voluntary  
                    withdrew from the program, as well as those who  
                    were subsequently determined to no longer be  
                    eligible, and a summary of the reasons why, as  
                    specified.
                  g.        Identification of barriers to  
                    participation and recommendations for program  
                    improvements.
                  h.        A comparison of average annual  
                    expenditures for individuals with similar  
                    characteristics not participating in the  
                    Self-Determination Program. 

             37)  Requires the State Council on Developmental  
               Disabilities, in collaboration with others, as  
               specified, to issue a report to the Legislature no  
               later than three years following the approval of the  
               federal funding on the status of the  
               Self-Determination Program, and provide  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageK


          
               recommendations to enhance the effectiveness of the  
               program.

                                  FISCAL IMPACT  

          This bill has not been analyzed by a fiscal committee.

                            BACKGROUND AND DISCUSSION  

           Purpose of the bill
           
          The author states that this bill is intended to increase  
          choices of services for families of consumers with  
          developmental disabilities to allow them to have more  
          control and flexibility in their service plans.  This is  
          important because due to our recent budget constraints and  
          lack of funding, many types of effective services have been  
          cut, according to the author. He states that this bill  
          creates a Self-Determination Program, which will allow the  
          consumer and parents to create a service plan that is more  
          beneficial to the individual receiving the services.

           Regional Center system
           


          California's 21 nonprofit regional centers are part of a  
          system of care for individuals with developmental  
          disabilities overseen by DDS. With a proposed budget of  
          $4.3 billion for community- based services in 2013-2014,  
          DDS is responsible for coordinating care and providing  
          services for more than 250,000 people who receive services  
          and supports to live in their communities, as well as  
          approximately 1,560 people who resided in developmental  
                                                                               centers as of March 6, 2013.


          California's 21 regional centers are non-profit  
          organizations that provide local services and supports to  
          individuals through contracts with DDS. Regional centers  
          provide diagnosis and assessment of eligibility and help  
          plan, access, coordinate and monitor the services and  
          supports that are needed because of an individual's  
          developmental disability. Services for consumers are  
          determined through an individual program plan (IPP).





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageL


          


           Self-Determination
           
          The concept of facilitating a way for individuals with  
          developmental disabilities to choose their own services and  
          supports, rather than be prescribed a list of customized  
          services began in the mid 1990s. According to a 2007 Robert  
          Wood Johnson Foundation report, the growing move toward  
          de-institutionalization and the home and community based  
          waivers associated with that move allowed states to serve  
          more people. However, most states did not have the  
          resources to meet the long-term care needs of everyone who  
          sought help.<1>

          The foundation created a Self-Determination for Persons  
          with Developmental Disabilities Program in 1996 to help 18  
          states implement a more cost-effective system, while  
          simultaneously giving consumers and their families more  
          choice in determining the services they receive. The  
          program - inspired by the success of a 1993  
          self-determination grant that the foundation gave to the  
          state of New Hampshire - authorized grant funding of up to  
          $5 million nationwide. While each program was unique, they  
          had common tenets including person-centered planning, an  
          independent support broker, individual budgets and a  
          designated fiscal intermediary. 

          An outcomes study commissioned by the foundation found  
          improvement in some but not all quality of life indicators.  
          A related study found that a system wide approach and the  
          availability of direct support workers were critical  
          factors in the success of self-determination initiatives.  
          Since then, at least 29 states have implemented  
          self-determination programs. 

           Self-determination in California
           
          In 1998 the Legislature passed a Self-Determination Pilot  
          Project that was conducted in five regional centers and  
          included about 200 participants.  A subsequent report to  
          the legislature showed that the participants were happy and  
          -------------------------
          <1>  
          http://www.rwjf.org/content/dam/farm/reports/program_results 
          _reports/2007/rwjf70028




          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageM


          
          had experienced more freedom and responsibility in  
          controlling the direction of their services and their life  
          choices. The report also indicated that good  
          self-determination practices required intensive  
          person-centered planning, collaboration, and follow-along  
          support. 

          Since then, there have been several attempts to bring the  
          program statewide, including a 2005 effort that was signed  
          by the Governor but never implemented due to problems  
          obtaining a federal waiver. 

          In 2009, amid stakeholder budget workgroup meetings that  
          were directed to find hundreds of millions of dollars of  
          cuts within the DDS system, a suggestion was made to use  
          the self-determination idea to trim costs and provide  
          greater independence for consumers. This concept, dubbed  
          the Individual Choice Budget, would have had to achieve  
          savings in order to be implemented within the budget.  
          Despite extensive conversations, and a proposal to fund the  
          individual budget at 90 percent of a consumer's existing  
          services, talks broke down over how to achieve savings  
          without making the program mandatory for all consumers, and  
          over how to fairly craft an individual budget. 

          In 2011, AB 1244 (Chesbro) attempted to rewrite the  
          existing statute in order to move DDS beyond the waiver  
          impasse with the federal government. This bill's language  
          reflects a combination of SB 1244 and existing statute but  
          leaves to DDS to determine how to calculate the individual  
          budget. It also eliminates the language around employment  
          of support workers and identifies new federal waivers that  
          could be used to support the program. The sponsor has  
          stated that CMS has approved other, similar programs in  
          other states since California originally applied for a  
          waiver for self-determination services and that this bill  
          provides additional vehicles that are more likely to  
          succeed.  

           Related legislation

           AB 1244 (Chesbro, 2011) would have created a  
          self-determination program to provide individuals with a  
          single, capitated funding allocation to purchase services  
          that support goals identified in the IPP.  It would have  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageN


          
          replaced the existing statutory language creating a  
          statewide self-directed services program, which required a  
          federal            waiver for implementation. It died in  
          the Senate Human Services Committee.
           
           AB 131 (Omnibus health trailer bill, Chapter 80, Statutes  
          of 2005) created a statewide self-directed services project  
          contingent upon approval of a waiver for federal funding by  
          the Centers for Medicaid and Medicare Services. The waiver  
          application remains pending.  

           SB 1038 (Thompson, Chapter 1043 Statutes of 1998) created a  
          3-year pilot project for local self-determination programs  
          and re-appropriated $750,000 to DDS from specified funds  
          appropriated pursuant to the Budget Act of 1998 for these  
          programs.

           Comments

          Individual budget

           Concerns have been raised about the lack of oversight of  
          the consumer's budget to ensure that funds are distributed  
          equitably throughout the year. While the author states this  
          is an implied responsibility of the independent fiscal  
          manager, staff suggests clarifying that role: 

          Staff recommends the following amendment: 
          
          4685.8. (c) (1) "Financial management services" means a  
          service or function that assists the participant to manage  
          and direct the distribution of funds contained in the  
          individual budget  and ensure that the participant has the  
          financial resources to implement his or her IPP throughout  
          the year.  This may include, but is not limited to, federal,  
          state, and local tax withholding payments, bill paying  
          services and activities that facilitate the employment of  
          support workers by the participant, including, but not  
          limited to fiscal accounting, and expenditure reports. The  
          department shall establish specific qualifications which  
          shall be required of a financial management services  
          provider.

           Cost neutrality
           





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageO


          
          This bill requires the Self-Determination program achieve  
          budget neutrality in the aggregate. Concerns have been  
          raised about how to ensure neutrality across regional  
          centers. Staff suggests cost neutrality be achieved within  
          each regional center.

          Staff recommends the following amendment:
          
          4658.8 (l)  The department, in consultation with  
          stakeholders, shall develop a methodology for individual  
          budgets that ensures the budgets are computed in a fair,  
          transparent, and equitable manner and are based on consumer  
          characteristics and needs, and a method for adjusting  
          individual budgets to address a participant's unanticipated  
          needs. In developing this methodology, the department shall  
          ensure that budgets of all participants are cost neutral in  
          the aggregate  within each regional center  .
           
          Number of participants 
           
          This bill establishes that initially, "up to 2,500 regional  
          center consumers may participate in the Self-Determination  
          Program statewide, and that regional centers must continue  
          to add any clients who want to participate in the program  
          after three years." 

          Should this bill move forward, Staff recommends that the  
          author work with stakeholders to clarify how to allocate  
          the slots across the regional center system so the cap is  
          met but not exceeded during the first three years.

           Budget methodology 
           
          This bill leaves to DDS the methodology for determining the  
          individual budget. Historically, this issue has been  
          controversial. The existing statute required the consumer  
          be provided two budget calculations - one based on the  
          consumer's previous two-year purchase of service average  
          and the other based on the average cost of services for  
          consumers with similar needs for the prior two fiscal  
          years. The consumer could then choose which budget to  
          accept. AB 1244 (Chesbro, 2011) established the same budget  
          methodology. While the author has deliberately left this  
          issue to the Department to decide in SB 468, staff suggests  
          providing some direction to DDS in deciding the  





          STAFF ANALYSIS OF SENATE BILL 468 (Emmerson)            
          PageP


          
          methodology. 
          Should this bill move forward, Staff recommends that the  
          author work with stakeholders to better define a  
          methodology or methodologies that DDS should consider in  
          establishing the individual budget. 
          
                                    POSITIONS  

          Support:       Disability Rights California (sponsor)
                              Autism Society Los Angeles 
                         Easter Seals California
                         State Council on Developmental Disabilities

          Oppose:   None received 





                                   -- END --