BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON APPROPRIATIONS
                             Senator Ricardo Lara, Chair
                            2015 - 2016  Regular  Session

          AB 741 (Williams) - Mental health:  community care facilities
          
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          |Version: June 16, 2016          |Policy Vote: HUMAN S. 4 - 0,    |
          |                                |          HEALTH 8 - 0          |
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          |Urgency: No                     |Mandate: Yes                    |
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          |Hearing Date: August 11, 2016   |Consultant: Brendan McCarthy    |
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          *********** ANALYSIS ADDENDUM - SUSPENSE FILE ***********
             The following information is revised to reflect amendments 
                     adopted by the committee on August 11, 2016






          Bill  
          Summary:  AB 741 would allow a short-term residential treatment  
          center to be operated as a children's crisis residential center,  
          with specified regulatory requirements.


          Fiscal  
          Impact:  
           One-time costs of about $550,000 for the development of  
            regulations by the Department of Social Services (General  
            Fund). The bill requires the Department to adopt regulations  
            to specify the requirements for operating a short-term  
            residential treatment center as a children's crisis  







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            residential center. 

           Unknown information technology costs, likely in the low  
            hundreds of thousands, for the Department of Social Services  
            to modify its internal systems for licensing and regulating  
            children's crisis residential treatment centers (General  
            Fund).

           Ongoing costs of about $125,000 per year for the Department of  
            Social Services to license and regulate children's crisis  
            residential center (General Fund). Although the Department  
            does collect licensing fees from regulated entities, those  
            fees are not set at a level that is sufficient to fund the  
            Department's licensing and enforcement program.

           No significant administrative costs are anticipated by the  
            Department of Health Care Services. The bill requires the  
            Department to establish Medi-Cal rates to pay for the costs of  
            providing children's crisis residential services. However, the  
            Department indicates that the Medi-Cal State Plan already  
            includes children's crisis residential services and includes a  
            methodology to pay for those services. The Department  
            indicates that the reimbursement rate will be the same as that  
            provided for adult crisis residential services.

           Unknown increase in Medi-Cal costs due to increased  
            utilization of children's crisis residential services (General  
            Fund, local funds, and federal funds). The intention of the  
            bill is to provide services to children in children's crisis  
            residential centers, rather than in psychiatric hospitals or  
            general acute care hospitals. In those cases, there would  
            likely be cost savings to Medi-Cal, since the reimbursement  
            rates for crisis residential services will be lower than  
            inpatient hospital rates. However, there is a consensus that  
            there is a significant shortage in available psychiatric beds  
            for children in the state. There is likely to be a significant  
            unmet need for psychiatric inpatient services. Therefore, some  
            of the utilization of children's crisis residential care will  
            be in addition to those services currently being provided in  
            hospitals, rather than a substitution for services already  
            being provided. The size of this impact is unknown.


          Author  








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          Amendments:  Make children's crisis residential centers eligible  
          for grant funding authorized in the 2016 Budget Act.


          Committee  
          Amendments:  Clarify the limits on placements in a children's  
          crisis residential center, require centers to report data to the  
          state, and delete the Department's authority to waive existing  
          statutory requirements.


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