BILL ANALYSIS Ó AB 847 Page 1 Date of Hearing: April 28, 2015 ASSEMBLY COMMITTEE ON HEALTH Rob Bonta, Chair AB 847 (Mullin) - As Amended March 26, 2015 SUBJECT: Mental health: community-based services. SUMMARY: Requires the Department of Health Care Services (DHCS) to apply to the federal Secretary of Health and Human Services (HHS Secretary) for the planning grant awarded for the purpose of developing proposals to participate in demonstration programs to improve mental health services furnished by certified community behavioral health clinics to Medi-Cal beneficiaries. EXISTING FEDERAL LAW: 1)Federal law authorizes the Patient Protection and Affordable Care Act (ACA) to increase access to health care through a number of measures, including expanding Medicaid eligibility, subsidizing insurance premiums, and setting aside funds for health promotion and disease prevention, among others. 2)Federal law authorizes the Protecting Access to Medicare Act (H.R. 4302) to establish an eight-state demonstration project that creates criteria for "Certified Community Behavioral Health Clinics" (CCBHCs), entities designed to serve individuals with serious mental illnesses and substance use disorders, and provides $25 million that will be available to AB 847 Page 2 states as planning grants to develop applications to participate in the two year pilot. EXISTING STATE LAW: 1)Establishes the Medi-Cal Program, administered by DHCS, which provides comprehensive health benefits to low-income children, their parents or caretaker relatives, pregnant women, elderly, blind or disabled persons, nursing home residents, and refugees who meet specified eligibility criteria. 2)Establishes, under the terms of a federal Medicaid waiver, a managed care program providing Medi-Cal specialty mental health services for eligible low-income persons administered through local county MHPs under contract with the state. FISCAL EFFECT: This bill has not yet been analyzed by a fiscal committee. COMMENTS: 1)PURPOSE OF THIS BILL. According to the author, the federal Protecting Access to Medicare Act would enable successful states to nearly double federal funds to support community mental health and alcohol and drug services with no additional state or county cost. The law currently allows for eight states to be selected for two years to have the federal share of costs increased for outpatient mental health and alcohol and drug services increased from the current level of 50% to at least 65%. The author states that this would mostly affect people who are disabled due to a severe mental illness. If successful, this would have a value to California of about $2 billion. It would significantly help California's counties get more people, who are homeless due to untreated mental illness, off the streets, out of hospitals and jails and into treatment. The author concludes that it would also likely AB 847 Page 3 generate additional savings to Medi-Cal from reduced physical health hospitalizations. 2)BACKGROUND. a) Protecting Access to Medicare Act. On March 31, 2014, Congress passed the Protecting Access to Medicare Act (H.R. 4302), which included a demonstration program aimed at increasing Americans' access to community mental health and substance use treatment services while improving Medicaid reimbursement for these services. This legislation: i) Creates criteria for CCBHCs as entities designed to serve individuals with serious mental illnesses and substance use disorders that provide intensive, person-centered, multidisciplinary, evidence-based screening, assessment, diagnostics, treatment, prevention, and wellness services. The HHS Secretary is directed to establish a process for selecting states to participate in a two year pilot program; ii) Provides $25 million that will be available to states as planning grants to develop applications to participate in the two year pilot. Only states that have received a planning grant will be eligible to apply to participate in the pilot; iii) Stipulates that eight states will be selected to participate in the two year pilot program. The match rate for CCBHC services is either the Enhanced Federal Medical Assistance Program (FMAP) /Children's Health AB 847 Page 4 Insurance Program rate or, for newly eligible "expansion" Medicaid beneficiaries, the current FMAP for that population - which is 100% now and moves down to 90% by 2020; and, iv) Requires participating states to develop a Prospective Payment System for reimbursing CCBHCs for required services provided by these entities. b) Program Timeline. i) September 1, 2015: Deadline for the HHS Secretary to publish: criteria for a clinic to be certified by a State as a certified community behavioral health clinic; and, guidance for states on the establishment of a prospective payment system for certified clinics participating in the demonstration program. ii) January 1, 2016: Deadline for the HHS Secretary to award planning grants to states for the purpose of developing proposals to participate in the demonstration program. iii) September 1, 2017: Deadline for the HHS Secretary to select the states that will participate in the demonstration program. Only states that have received a planning grant are eligible to participate. The states will be selected through a competitive application process and must represent a diverse selection of AB 847 Page 5 geographic areas, including rural and underserved areas. c) Certified Community Behavioral Health Clinics. The Substance Abuse and Mental Health Services Administration (SAMHSA) is currently in the process of determining what the eligibility criteria will be for the CCBHC. The CCBHC demonstration program and Prospective Payment System are designed to work within the scope of State Medicaid Plans and to apply specifically to individuals who are Medicaid enrollees. The statute also requires that the CCBHCs not refuse service to any person based either on ability to pay or residence. According to SAMHSA, this requirement, together with the fact that improving access to and the quality of health care for the Medicaid population may also positively affect the health of others, means that the CCBHC demonstration program may have long-lasting and beneficial effects beyond the realm of Medicaid enrollees. Further, while the statute is clear that the CCBHCs are to provide services to all who seek help, it is anticipated that the CCBHCs will prove particularly valuable for individuals with serious mental illness, children and adolescents with serious emotional disturbance and those with co-occurring mental health, substance use and/or physical health disorders. Finally, the statute directs that the care provided be "patient-centered." It is expected that CCBHCs will offer care that is person-centered and family-centered in accordance with the requirements of the Affordable Care Act. 3)SUPPORT. The Steinberg Institute, sponsor of this bill, states in support that this bill directs DHCS to develop and submit a proposal to compete to become one of the eight designated states to receive significantly enhanced federal mental health funds under the Excellence in Mental Health Act - enacted as Section 223 of the Protecting Access to Medicare Act of 2014. This federal law would enable selected states to nearly double federal funds to support community mental health and alcohol and drug services with no additional state or county cost. The law currently allows eight states to have the federal share of costs increased for outpatient mental AB 847 Page 6 health and alcohol and drug services increased from the current level of 50% to at least 65% over a two year period of time. If DHCS is successful, this would bring an additional $2 billion in funding to California, which would significantly impact California's ability to ensure that those who are homeless, due to untreated mental illness, get off the streets, out of hospitals and jails, and into treatment. Participating in the Act would also likely generate additional savings to Medi-Cal from reduced physical health hospitalizations. 4)RELATED LEGISLATION. This bill is substantially similar to AB 861 (Maienschein) and is currently pending in the Assembly Health Committee. 5)PREVIOUS LEGISLATION. AB 2287 (Monning) of 2010 required the California Health and Human Services Agency (CHHSA) to direct the appropriate state departments within the agency to apply for Community Transformation Grants under the ACA. This bill died in Senate Appropriations Committee. 6)AMENDMENTS. The Committee is adopting amendments to add an urgency clause to the bill to ensure the provisions of this bill go into immediate effect upon enactment. REGISTERED SUPPORT / OPPOSITION: Support The Steinberg Institute (sponsor) AB 847 Page 7 California Coalition for Mental Health California Council of Community Mental Health Agencies Disability Rights California Mental Health America of California Opposition None on file. Analysis Prepared by:Paula Villescaz / HEALTH / (916) 319-2097