BILL ANALYSIS Ó AB 635 Page 1 Date of Hearing: April 22, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 635 (Atkins) - As Introduced February 24, 2015 ----------------------------------------------------------------- |Policy |Health |Vote:|16 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No AB 635 Page 2 SUMMARY: This bill establishes a medical interpretation services program at the Department of Health Care Services (DHCS) to provide and reimburse for certified medical interpretation (CMI) services to limited English proficient (LEP) Medi-Cal enrollees in both the fee-for service and managed care. Additionally, this bill: 1)Authorizes Medi-Cal providers and any providers contracting with Medi-Cal managed care organizations (MCOs) to use the program. 2)Requires all contracts between MCOs and their subcontractors to include provisions describing access to CMI services under the program. 3)Requires DHCS to create a community advisory committee consisting of stakeholders and health care providers to advise DHCS on the program's implementation. FISCAL EFFECT: AB 635 Page 3 1)One-time administrative costs in the range of $1 million (GF/federal) to DHCS to seek federal approvals, create system protocols, develop an IT infrastructure, design communications and guidance, promulgate regulations, and other initial program development activities. 2)An exact estimate of the cost of language services is difficult given a lack of accurate projections about how, by whom, and with what frequency a centralized system would be used. Assuming 2 million LEP individuals receive one additional office visit annually with interpretive services provided through this program at a cost of $20 per visit, additional costs would be about $40 million annually. This overall cost increase would be experienced as direct costs in the case of fee-for-service Medi-Cal, and cost pressure on rates in the case of Medi-Cal managed care. The majority of enrollees are now in managed care plans. 3)Medi-Cal costs would be at a 50% GF, 50% federal funds matching rate, except for the following: a) Costs associated with individuals found newly eligible for Medi-Cal pursuant to the expansion related to the Patient Protection and Affordable Care Act and subsequent 2013 state legislation, which expanded Medi-Cal to childless adults. Costs for these individuals are funded at a rate of 100% federal funds until 2017, after which the federal matching rate gradually decreases to 90% for 2020 and beyond. b) Costs associated with services provided to CHIP- and Medi-Cal eligible children. CHIP provides federal reimbursement for health care for low-income children up AB 635 Page 4 to 250% of the federal poverty level. A 75% federal funds matching rate is available for language services for CHIP- and Medi-Cal eligible children, pursuant to the Children's Health Insurance Program Reauthorization Act of 2010 (CHIPRA), and a two-year funding extension until federal fiscal year 2017 signed into law April 16, 2015. The law authorizing the higher matching rate does not expire, but in practical terms the availability of enhanced match is contingent on CHIP funding. 4)Improved access to high-quality interpretive services is likely to improve access to care and increase overall medical costs to the Medi-Cal program for LEP beneficiaries. It would also likely result in some offsetting cost savings associated with the provision of higher-quality care and fewer medical errors. The magnitude of savings as compared to costs is unknown, but evidence suggests that, on balance, the Medi-Cal program would experience increased medical costs if centralized, high-quality interpretive services were available. COMMENTS: 1)Purpose. Various federal and state laws require health providers and health plans receiving federal funding to provide interpreter services to patients. Despite these requirements in law, there are indications not all Medi-Cal beneficiaries receive care in a linguistically appropriate manner. The author notes, "Language barriers can contribute to inadequate patient evaluation and diagnosis, lack of appropriate and/or timely treatment or other medical errors than can jeopardize patient safety." Enhanced federal funding opportunities allow California to develop a more comprehensive language assistance program. 2)Background. It is well-documented that limited proficiency in English is a risk factor for reduced access to health AB 635 Page 5 services, decreased satisfaction with care, poor understanding of instructions, longer hospital stays, and increased risk of medical errors and misdiagnoses. A recent study found LEP hospital patients are more likely than their English-speaking counterparts to experience adverse events that result in harm, and the severity of that harm is often greater. Title VI of the federal Civil Rights Act of 1964 requires health care providers accepting federal funds to provide linguistically accessible services to all patients. Linguistic accessibility standards have been upheld and further clarified through a number of related court decisions, regulations, guidance, and executive orders. However, these standards appear flexible and do not appear adequate to ensure high-quality services are available everywhere. For example, the Federal Health and Human Services Agency (HHS) guidance indicates smaller recipients of federal funds with more limited budgets are not expected to provide the same level of language services as larger recipients with larger budgets. The provision of language services in current practice appears to be highly variable across the state, varying based on the proportion of LEP persons served, health care provider/facility priorities, and available resources. This bill intends to establish medical interpreter services as a separate program that would be made uniformly available to all LEP Medi-Cal beneficiaries. 3)Prior legislation. a) AB 2325 (John A. Pérez) of 2014, AB 1263 (John A. Pérez) of 2013, and AB 2392 (John A. Pérez) of 2012, were similar to this bill in the creation of a medical interpreter program, but also included registration and certification provisions for interpreters, as well as collective bargaining provisions. 1) AB 2392 passed both houses of the legislature but was not taken up for concurrence in the Assembly. 2) AB 1263 was vetoed by the governor, citing his AB 635 Page 6 concern about introducing yet another complex element as the state embarks on an unprecedented expansion of Medi-Cal. 3) AB 2325 was vetoed by the Governor, citing ongoing challenges in Medi-Cal and concerns about the scope of collective bargaining allowed under the bill. The veto message indicated a willingness to "work together on appropriate cost-effective initiatives to help patients in need, to the extent that interpretation services under Medi-Cal are insufficient." a) AB 505 (Nazarian), Chapter 788, Statutes of 2014, codified existing Medi-Cal MCO requirements to provide language assistance, translation, and interpretation services when populations reach specified thresholds. b) SB 853 (Escutia), Chapter 713, Statutes of 2003, requires the Department of Managed Health Care and the California Department of Insurance to adopt regulations to ensure enrollees have access to language assistance in obtaining health care services. 1)Staff Comments. a) Potential Cost Shift. The program envisioned in this bill may increase the availability and improve the quality of language services to Medi-Cal enrollees, but it also would encourage a significant cost shift from private providers, who are currently required to provide these services under federal law and/or managed care plan contracts. In addition, some of the providers that do offer quality interpretive services already receive indirect reimbursement for these services. For example, public hospitals have well-established interpretive networks. These hospitals have unique funding arrangements whereby they do not receive direct reimbursement from the state, but instead certify their own expenditures for language services as eligible for federal matching dollars. Many federally qualified health centers (FQHCs) also AB 635 Page 7 provide interpretive services, and receive reimbursement for these services as part of an all-inclusive per-visit rate that is based on the FQHC's total costs. b) Increased Access = More Medical Costs. Increasing access to high-quality language services in the Medi-Cal program would likely reduce health disparities, improve LEP patient satisfaction, improve the quality of care provided to LEP patients, and increase the use of preventative care. However, it is also likely to increase total medical expenditures for LEP patients. Analysis Prepared by:Lisa Murawski / APPR. / (916) 319-2081