BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 870| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINESS Bill No: SB 870 Author: Senate Budget and Fiscal Review Committee Amended: 6/13/14 Vote: 21 PRIOR VOTES NOT RELEVANT ASSEMBLY FLOOR : Not available SUBJECT : Budget Act of 2014: Health SOURCE : Author DIGEST : This is the Omnibus Health Trailer Bill for the 2014-15 Budget Act. It contains necessary changes related to the Budget Act of 2014-15. Assembly Amendments delete the Senate version of the bill, which expressed legislative intent to enact statutory changes relating to the Budget Act, and instead add the current language. ANALYSIS : This bill makes the following statutory changes to implement the 2014-15 Budget: 1. Medi-Cal: Applied Behavioral Analysis (ABA). This bill requires ABA, or behavioral health treatment, to be a covered Medi-Cal service for individuals under age 21 to the extent required by the federal government. This bill requires the Department of Health Care Services (DHCS) to implement this new benefit only after consultation with stakeholders. CONTINUED SB 870 Page 2 2. Medi-Cal: Supplemental Managed Care Organization (MCO) Drug Rebates for Specialty Drugs. This bill allows for MCO supplemental rebates for specialty drugs, such as Hepatitis C drugs like Sovaldi. This rebate collection occurs when (1) DHCS reimburses health plans through a separate capitated payment or other supplemental payment ("kick-payment") for the specialty drug and (2) health plans follow the clinical guidelines (coverage policies) for this drug. It is estimated that this change would result in $6 million General Fund savings in 2014-15, $20 million General Fund savings in 2015-16, and $31 million General Fund savings annually thereafter. 3. Medi-Cal: Pediatric Vision Projects. This bill implements a pilot program in Los Angeles County no sooner than January 1, 2015, and concluding December 31, 2017, to expand pediatric vision examinations and services through the use of mobile vision providers. 4. Medi-Cal: Program of All-Inclusive Care for Elderly (PACE) . This bill requires that PACE capitation rates be no less than 95% of the fee-for-service equivalent cost (current law is 90%). It is estimated that this change would result in $1.8 million General Fund costs in 2014-15, and $7.3 million General Fund costs annually, thereafter. 5. Medi-Cal: Rates and Access. This bill expresses the Legislature's intent that DHCS continue to monitor access to and utilization of Medi-Cal services and to use this information to evaluate the current reimbursement levels and make targeted changes to those reimbursement levels as it finds appropriate. 6. Robert F. Kennedy Health Plan. This bill provides $3.2 million in one-time funds from the Major Risk Medical Insurance to DHCS to be allocated to the Robert F. Kennedy Health Plan for purposes of purchasing stop loss insurance. 7. Electronic Health Records - State Match. This bill provides $3.75 million in one-time funds from the Major Risk Medical Insurance to DHCS to be used as the state match to draw down $37.5 million in federal funds to support the meaningful use of electronic health records in the state. CONTINUED SB 870 Page 3 8. HIV Demonstration Projects. This bill establishes public health demonstration projects for innovative, evidence-based approaches to provide outreach, HIV and Hepatitis C screenings, and linkages to, and retention in, quality health care for underserved individuals with high-risk for HIV infection. 9. Song-Brown Program - New Residency Slots. This bill specifies criteria for funds appropriated in the budget act for Song-Brown grants to primary care residency training programs. This bill specifies that priority shall be given to support new primary care physician slots and shall be given to physicians who have graduated from a California-based medical school. FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes Local: No According to the Senate Budget Committee, the funding related to the changes in this bill is contained in the 2014-15 Budget. This bill reappropriates Department of Developmental Services' funds. JL:nl 6/15/14 Senate Floor Analyses SUPPORT/OPPOSITION: NONE RECEIVED **** END **** CONTINUED