BILL ANALYSIS Ó
SENATE COMMITTEE ON HUMAN SERVICES
Senator McGuire, Chair
2015 - 2016 Regular
Bill No: AB 564
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|Author: |Eggman |
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|Version: |July 7, 2015 |Hearing |July 14, 2015 |
| | |Date: | |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant|Mareva Brown |
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Subject: Regional centers: parental fees
SUMMARY
This bill recasts the existing Parental Fee Program within the
Department of Developmental Services (DDS) by, among other
things, calculating monthly parental fees based on a percentage
of the parents' annual income and authorizing a credit of the
equivalent of one day of the monthly parental fee for each day a
child spends 6 or more consecutive hours in a 24-hour period on
a home visit. The bill would prohibit a monthly parental fee
from exceeding the maximum monthly cost of caring for a child or
the cost of services provided, whichever is less, and make other
related changes.
ABSTRACT
Existing law:
1) Establishes the Lanterman Developmental Disabilities
Services Act, which states that California is responsible
for providing an array of services and supports
sufficiently complete to meet the needs and choices of each
person with developmental disabilities, regardless of age
or degree of disability, and at each stage of life and to
support their integration into the mainstream life of the
community. (WIC 4500, et seq)
2) Establishes a system of nonprofit Regional Centers,
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overseen by DDS, 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) Requires a regional center to secure services and
supports that meet the needs of the consumer, as determined
in the IPP, and to give highest preference to those which
would allow minors with developmental disabilities to live
with their families, adult persons with developmental
disabilities to live as independently as possible in the
community, and that allow all consumers to interact with
persons without disabilities in positive, meaningful ways.
(WIC 4648)
5) Requires parents of children under the age of 18 years
who are receiving 24-hour out-of-home care services through
a regional center, or who are residents of a state hospital
or on leave from the state hospital shall be required to
pay a fee depending upon their ability to pay. Requires
that this fee not exceed the cost of caring for a normal
child at home, as determined by the Director of DDS, or the
cost of services provided, whichever is less. Requires that
DDS determine, assess, and collect all parental fees, as
specified, regardless of whether the child is placed in the
state hospital or in a public or private community
facility. Prohibits parents from being charged for
diagnosis or counseling services received through the
regional centers. (WIC 4782)
6) Requires the Director of DDS to establish, annually
review, and adjust as needed, a schedule of parental fees
for services received through the regional centers, and to
revise it, as specified, to reflect changes in economic
conditions that affect parents' ability to pay the fee.
(WIC 4784 (a) and (b))
7) In establishing the amount a parent shall pay, requires
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DDS to take into account all of the following factors: (WIC
4784 (c))
a. The current cost of caring for a child at
home, as determined by the most recent data available
from the United States Department of Agriculture's
survey on the cost of raising a child in California,
adjusted for the Consumer Price Index (CPI) from the
survey date to the date of payment adjustment.
b. Medical expenses incurred prior to regional
center care.
c. Whether the child is living at home.
d. Parental payments for medical expenses,
clothing, incidentals, and other items considered
necessary for the normal rearing of a child.
e. Transportation expenses incurred in visiting a
child.
8) Exempts from the parental fee families with an income
below the federal poverty level. (WIC 4784 (d))
9) Requires that fees be remitted to the Program
Development Fund of the state Treasury, as specified, to
provide resources needed to initiate new programs,
consistent with approved priorities for program development
in the state plan. (WIC 4784 (f)(1))
10) Requires that excess fees, as defined, that are
collected must be available for expenditure by DDS to
offset General Fund costs. (WIC 4784 (f)(2))
This bill:
1) Strikes existing WIC 4784, which requires DDS to review
annually and adjust the formula for calculating parental
fees for children placed in out-of-home care as well as the
requirement to include in that calculation changes in
economic conditions that affect a parent's ability to pay
and other factors that the department must include in their
calculation of a parental fee, as defined in WIC 4784 (c).
2) Replaces it with a new WIC 4784, effective July 1, 2016,
that requires DDS to assess a monthly fee to parents of
children under 18 years of age who are receiving 24-hour
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out-of-home care services through a regional center or as a
resident of a state hospital when the family's gross income
is above 200 percent of the federal poverty level.
3) Requires the parental fee to be effective 60 days from
the date of the child's admission to the 24-hour
out-of-home placement.
4) Requires, for the purpose of assessing the fee, that
parents provide DDS with income documentation within 30
days from the date of the request for such documentation
and requires that documentation to include a copy of a
parent's most recent federal tax return or a copy of each
parent's most recent paystub or employer-provided earnings
statement, or alternative verification, as defined.
5) Eliminates the requirement that parents between 100 and
200 percent of poverty pay a fee and otherwise sets the fee
as follows:
a. Parents who have a family income of 201
percent through 300 percent of the current federal
poverty level shall be assessed a fee of 3 percent of
their annual gross income to be billed in monthly
increments.
b. Parents who have a family income of 301
percent through 400 percent of the current federal
poverty level shall be assessed a fee of 4 percent of
their annual gross income to be billed in monthly
increments.
c. Parents who have a family income of 401
percent through 500 percent of the current federal
poverty level shall be assessed a fee of 5 percent of
their annual gross income to be billed in monthly
increments.
d. Parents who have a family income of 501
percent or more of the current federal poverty level
shall be assessed a fee of 6 percent of their annual
gross income to be billed in monthly increments.
6) Requires that parents who fail to provide income
documentation to the department within 30 days of the date
of the department's request shall be assessed a maximum
monthly fee equivalent to the maximum cost of caring for a
AB 564 (Eggman) Page 5
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child, as specified the most recent published version of
the US Department of Agriculture's Cost of Raising a Child,
but that fee must be retroactively adjusted based on income
information provided, once the parent provides appropriate
documentation.
7) Prohibits any fee being charged that exceeds the maximum
cost of caring for a child, as defined, or the cost of the
services provided, whichever is less.
8) Requires that the parental fee be recalculated every 12
months, and within 60 days of the date a parent notifies
the department of a change in family income or family size,
as specified.
9) Requires that parents of children placed in 24-hour
out-of-home care prior to July 1, 2016, shall have their
monthly parental fee recalculated pursuant to the
provisions of this section at the time of their annual fee
recalculation.
10) Permits DDS to grant a temporary waiver from paying the
monthly parental fee for parents who substantiate, with
receipts, an unavoidable and uninsured catastrophic loss
with direct economic impact on the family or significant
unreimbursed medical costs associated with care for a child
who is a regional center consumer.
11) Establishes that a parent is entitled to a credit of one
day's fee, as defined, if the parent removes their child
from the care facility for a home visit for any six
consecutive hours during a 24-hour period and requires that
requests for credits be post marked no later than 60 days
from the child's removal from the facility. Requires that
failure to provide documentation and postmark the request
as specified shall result in a denial of credit by the
Department.
12) Requires that all fees collected by the program be
deposited into the Program Development Fund, as defined, to
provide resources needed to initiate new programs,
consistent with approved priorities in the state's plan,
and expands the option for the department to use fees to
offset General Fund costs.
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13) Permits parents to appeal their monthly fee or the
denial of credit by submitting a written appeal request to
the director within 30 days, but limits the parent's appeal
to disputes concerning the family income used to set the
monthly parental fee and the denial or amount of credit.
14) Requires DDS to provide written notice of the decision
to the appellant within 30 days of receipt of the appeal,
and requires all decisions regarding monthly parental fee
appeals be retroactive to the date the appealed monthly
parental fee was assessed.
15) Limits the Department's scope in considering the appeal
to the income documentation and the calculation of the
monthly parental fee that was used in making the original
determination.
16) Makes additional statutory cleanup changes.
FISCAL IMPACT
No analysis of the current version of the bill has been done.
BACKGROUND AND DISCUSSION
Purpose of the bill:
According to the author, this bill will fix problems in the
parental fee program which a state audit found to be "riddled
with unnecessary delays, lack of documentation, incorrect
calculations and inconsistent staff interpretations." The author
requested a California State Auditor review of the program after
being contacted by a constituent whose 15-year old child was
placed out-of-home in a 24-hour care facility in Los Angeles.
The constituent reported dramatic fee increases, and when
consulting with other families, found significant differences in
fees from family to family. When he filed an appeal, the
constituent was subject to a lengthy and convoluted process,
which ultimately resulted in a reduction in fees. The Auditor
found similar issues statewide.
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The Lanterman Act
The Lanterman Developmental Disabilities Services Act
establishes an entitlement to services and supports for
Californians with developmental disabilities who are living in
their communities. A developmental disability is one that
originates before the age of 18, continues, or can be expected
to continue, indefinitely, and constitutes a substantial
disability. Approximately 290,000 children and adults with
developmental disabilities are served in community-based
programs and supported by state- and federally-funded services
that are coordinated by 21 nonprofit regional centers. Another
1,077 individuals live in four state-run institutions, including
three Developmental Centers, as of July 1. About 77 percent of
all consumers and 97 percent of child consumers live in the home
of a parent or guardian or in their own home.
Services are developed locally and regional centers provide
diagnosis and assessment of eligibility and help plan, access,
coordinate and monitor the services and supports that are
needed. Services for consumers are determined through an
individual program plan (IPP).
Parental fee program
Established in the early years of the Lanterman Act, the
Parental Fee Program requires parents to pay a share of cost if
their children are under 18 years of age and receive 24-hour
out-of-home care, paid for by a regional center. The calculation
includes having the Director of DDS consider a family's gross
income, age of the child, travel expenses to visit the child,
medical expenses incurred prior to the out-of-home placement,
parental payments for specified items "considered necessary in
the normal rearing of a child," and others. The parental fee is
intended to be based on a parent's ability to pay.
For families with income at or above 100 percent of the Federal
Poverty Level, fees range from $59 to $1,877 per month, based on
family size and income. Currently, 559 are children in the
Parental Fee Program and approximately 4,300 children statewide
in out-of-home residential care. Money from the Parental Fee
Program is required by statute to be deposited into the Program
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Development Fund, which is used to initiate new programs
consistent with the California Developmental Disabilities State
Plan. Excess funds must be used to offset the Department's
General Fund expenses. This bill relaxes that distinction.
State auditor review
A January 2015 report by the California State Auditor<1> found
that the program was riddled with errors and inconsistencies
that placed some parents at a significant disadvantage. The
report noted that as a result of staff error and inconsistent
interpretations and processes, parents with similar financial
circumstances may be assessed substantially different levels of
fees. Auditors reviewed approximately 10 percent of the cases in
the program and found that the process DDS uses to assess
parental fees is "riddled with unnecessary delays, lack of
documentation, incorrect calculations, and inconsistent staff
interpretations. For instance, because Developmental Services
does not hold regional centers accountable for providing
required reports of children newly placed in outofhome care,
months or even years pass before Developmental Services becomes
aware of the need to assess fees on certain families.
The audit also found incorrectly assessed fees by hundreds of
dollars per month due to various staff errors, and inconsistent
documentation- verification was required of some families but
not others. "We observed similar errors, lack of documentation,
and inconsistent staff interpretations with the process DDS uses
to review parents' appeals of fees." The auditor concluded that
because the appeals process considers expenses and deductions
that are not taken into account in the initial fee assessment
process, 95 percent of all appeals result in a fee reduction,
underscoring the inconsistency in both the original calculation,
and the appeals process. The Auditor concluded that the annual
amount of unbilled fees ranges from $740,000 to $1.1 million.
Related legislation:
AB 9 (Evans, Chapter 9, 4th Extraordinary Session, 2009) revised
the parental fee provisions by providing for additional factors
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<1> "California Department of Developmental Services: Its
Process for Assessing Fees Paid by Parents of Children Living in
Residential Facilities Is Woefully Inefficient and
Inconsistent," California State Auditor January 13, 2015
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to be used in determining the fee adjustment, and other changes.
COMMENTS
This bill attempts to provide structure within a program that
had been inconsistently statewide. By replacing the somewhat
subjective calculations required in statute with a strict
methodology based solely on family income, the author hopes to
remove the inconsistencies that left some families with
significantly higher fees than others who were similarly
situated. The current language would do the following:
1) Clarify the amount a parent must pay is based solely on
a percentage of gross income.
2) In some cases, reduce a family's obligation.
3) Eliminate the obligation of a family between 100 and 200
percent of poverty to pay a parental fee.
4) Set time lines for the receipt of documentation or
require a maximum payment be assessed until required
documents are received
5) Permit DDS to waive the fee under certain circumstances.
6) Relax the requirement that DDS use the money first to
provide resources needed to initiate new programs, and
secondarily to fund General Fund obligations if excess
funding is collected. This bill permits any funds to be
used on General Fund obligations.
The following chart demonstrates the new structure and change in
fees for some families:
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| FPL For | Fee | Impact to Families |
| Family |Percentag| |
| Income | e | |
|----------+---------+---------------------------------|
| 0-100% | 0% |No change. |
|----------+---------+---------------------------------|
| 101-200% | 0% |A family of 4, with income of |
| | |$41,400 would have assessed fees |
| | |reduced from $335 per month to |
| | |$0 per month. |
|----------+---------+---------------------------------|
| 201-300% | 3% |A family of 4, with income of |
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| | |$59,196 would have assessed fees |
| | |reduced from $536 per month to |
| | |$148 per month. |
|----------+---------+---------------------------------|
| 301-400% | 4% |A family of 4, with income of |
| | |$84,419 would have assessed fees |
| | |reduced from $670 per month to |
| | |$281 per month. |
|----------+---------+---------------------------------|
| 401-500% | 5% |A family of 4, with income of |
| | |$102,600 would have assessed |
| | |fees reduced from $1,139 per |
| | |month to $428 per month. |
|----------+---------+---------------------------------|
| 501% and | 6% |A family of 4, with income of |
| above | |$151,560 would have assessed |
| | |fees reduced from $1,555 per |
| | |month to $758 per month. |
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While the author has clarified the provisions of the program
with substantial technical assistance from DDS, the committee
additionally suggests permitting families to request a
reconsideration of the initial recalculation rather than having
to wait up to a year to see potential fee reductions resulting
from this bill.
Staff recommends the following amendment:
4784 (e) (5) Parents of children placed in 24-hour out-of-home
care prior to July 1, 2016, shall have their monthly parental
fee recalculated pursuant to the provisions of this section at
the time of their annual fee recalculation, or within 30 days of
a request for review by the Department .
PRIOR VOTES
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|Assembly Floor: |78 - |
| |0 |
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|Assembly Appropriations Committee: |17 - |
| |0 |
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|Assembly Human Services Committee: | 7 |
| |- 0 |
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POSITIONS
Support:
State Council on Developmental Disabilities
Oppose:
None received.
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