BILL ANALYSIS                                                                                                                                                                                                    

                          Senator Ed Hernandez, O.D., Chair

          BILL NO:                    AB 847    
          |AUTHOR:        |Mullin                                         |
          |VERSION:       |April 30, 2015                                 |
          |HEARING DATE:  |June 17, 2015  |               |               |
          |CONSULTANT:    |Reyes Diaz                                     |
           SUBJECT  :  Mental health: community-based services.

           SUMMARY  :  Requires the Department of Health Care Services to apply to  
          the Secretary of the U.S. Health and Human Services for a  
          specified federal planning grant for the purpose of developing  
          proposals to improve mental health services provided by  
          certified community behavioral health clinics to Medi-Cal  
          beneficiaries. Contains an urgency clause that will make this  
          bill effective upon enactment

          Existing law:
          Federal law
          1)Enacts 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.

            Authorizes, in Section 223 of the Protecting Access to  
            Medicare Act (PAMA) of 2014 (P.L. 113-93), a two-year  
            demonstration program, to include up to eight states, that  
            creates criteria for by certified community behavioral health  
            clinics (CCBHCs) and provides planning grants to develop  
            applications to participate in the demonstration program. 

          State law
          2)Establishes the Medi-Cal program, administered by the  
            Department of Health Care Services (DHCS), under which  
            qualified low-income persons receive health care benefits. The  
            Medi-Cal program is, in part, governed and funded by the  
            federal Medicaid provisions.

          3)Establishes, under the terms of a federal Medicaid waiver, a  


          AB 847 (Mullin)                                    Page 2 of ?
            managed care program providing Medi-Cal specialty mental  
            health services for eligible low-income persons administered  
            through local county mental health plans under contract with  
          This bill:
          1)Requires DHCS to apply for planning grants available pursuant  
            to PAMA for purposes of developing proposals to participate in  
            the demonstration program to improve mental health services  
            provided by CCBHCs to Medi-Cal beneficiaries. 

          2)Contains an urgency clause that will make this bill effective  
            upon enactment.

          EFFECT  :  According to the Assembly Appropriations Committee,  
          this bill includes administrative costs to DHCS estimated at  
          under $100,000 (General Fund/federal) to apply for the planning  
          grant. This is subject to uncertainty, as the grant application  
          has not yet been released. If this grant is received, federal  
          planning grant funds would pay for the development of the  
          demonstration program grant. 

          VOTES  :  
          |Assembly Floor:                     |74 - 0                      |
          |Assembly Appropriations Committee:  |17 - 0                      |
          |Assembly Health Committee:          |19 - 0                      |
          |                                    |                            |
          COMMENTS  :
          1)Author's statement. According to the author, the federal  
            Excellence in Mental Health Act will enable successful states  
            to nearly double federal funds to support community mental  
            health and substance use disorder (SUD) services with no  
            additional state or county cost. The law currently allows for  
            up to eight states to be selected for two years to have the  
            federal matching funds increased for outpatient mental health  
            and SUD services from the current level of 50% to be  


          AB 847 (Mullin)                                    Page 3 of ?
            equivalent to the enhanced federal matching rate for the  
            Children's Health Insurance Program (CHIP). This would mostly  
            affect people who are disabled due to a severe mental illness.  
            If California is successful in its application for the  
            increased funding, this would have a value of about $2 billion  
            and would significantly help California's counties get more  
            people who are homeless due to untreated mental illness off  
            the streets and out of hospitals and jails and into treatment.  
            It would also likely generate additional savings to Medi-Cal  
            from reduced physical health hospitalizations for this  

          2)Background. Federal law authorizes PAMA to establish a  
            demonstration program, to include up to eight states, that  
            creates criteria for CCBHCs, which are facilities designed to  
            serve individuals with serious mental illnesses and SUDs. PAMA  
            provides nearly $25 million that will be available to states  
            as planning grants to develop applications. PAMA also directs  
            the Secretary of the U.S. Health and Human Services (USHHS) to  
            award planning grants to states for the development of  
            demonstration proposals by January 1, 2016, and to select  
            states to participate in the demonstration program by  
            September 1, 2017. Section 223 of PAMA authorizes the USHHS  

               a)     Establish criteria that states will use to certify  
                 CCBHCs for a two-year demonstration program;
               b)     Provide guidance on the development of a Prospective  
                 Payment System (PPS) for payment of services provided by  
               c)     Award grants to states for planning purposes to  
                 develop proposals to participate in the demonstration  
               d)     Select up to eight states to participate in the  
                 demonstration program;
               e)     Pay states participating in the demonstration  
                 program federal matching funds equivalent to the standard  
                 CHIP matching rate for services provided to currently  
                 enrolled Medicaid beneficiaries; and,
               f)     Evaluate the program and prepare annual reports to  

            As indicated on the Substance Abuse and Mental Health Services  
            Administration's (SAMHSA) Web site, states may submit  


          AB 847 (Mullin)                                    Page 4 of ?
            applications for the planning grants through August 5, 2015.  
            According to DHCS, the department will apply for the planning  

          1)CCBHCs. SAMHSA is currently in the process of determining what  
            the eligibility criteria will be for states to certify CCBHCs.  
            The CCBHC demonstration program and the PPS are designed to  
            work within the scope of State Medicaid Plans and to apply  
            only to individuals who are Medicaid enrollees. According to  
            SAMHSA, this demonstration program provides an opportunity for  
            states to improve the behavioral health of their residents by  
            providing community-based mental health and SUD treatment, and  
            by helping to further integrate behavioral health with  
            physical health care, utilize evidence-based practices on a  
            more consistent basis, and improve access to high quality  
            care. According to SAMHSA, populations to be served are adults  
            with serious mental illness, children with serious emotional  
            disturbance, and those with long term and serious SUDs, as  
            well as others with mental illness and SUDs.
          2)Related legislation. AB 861 (Maienschein), would require DHCS  
            to submit an application for a subsequent grant under PAMA, if  
            it applies for and is awarded the PAMA planning grant, and  
            requires DHCS to work with counties and stakeholders to  
            identify the unmet need for covered services and to estimate  
            the number of individuals who need housing assistance. AB 861  
            also requires the competitive grant proposal to include plans  
            for counties to redirect current funds to provide housing for  
            those with severe mental illnesses. AB 861 is set for hearing  
            in the Senate Health Committee on June 17, 2015.
          3)Prior legislation. AB 2287 (Monning, 2010), would have  
            required the California Health and Human Services Agency to  
            direct the appropriate state departments within the agency to  
            apply for community transformation grants under the ACA.  AB  
            2287 died in Senate Appropriations Committee.
          4)Support. Supporters of this bill, which include health,  
            behavioral health, and disability rights advocates, argue that  
            PAMA enables selected states to nearly double federal funds to  
            support community mental health and SUD services. They argue  
            that the added funding is an important complement to the  
            current behavioral health care funding and will significantly  
            expand the number of people in need that could be served. The  


          AB 847 (Mullin)                                    Page 5 of ?
            California Chapter of the American College of Emergency  
            Physicians (California ACEP) states that a 2012 study in the  
            Annals of Emergency Medicine found that patients having  
            psychiatric emergencies wait approximately 42 percent longer  
            in the emergency department than other emergency patients.  
            Therefore, California ACEP supports this bill because it has  
            the potential to help improve access to MH services provided  
            to Medi-Cal patients at CCBHCs.
          Support:  The Steinberg Institute (sponsor)
                    American Association for Marriage and Family Therapy,  
                    California Division
                    California Chapter of the American College of  
                    Emergency Physicians
                    California Coalition for Mental Health
                    California Council of Community Mental Health Agencies
                    California Primary Care Association
                    California Youth Empowerment Network
                    Disability Rights California
                    Mental Health America of California
          Oppose:   None received.
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