BILL ANALYSIS Ó AB 1235 Page 1 Date of Hearing: April 28, 2015 ASSEMBLY COMMITTEE ON HEALTH Rob Bonta, Chair AB 1235 Gipson - As Amended April 23, 2015 SUBJECT: Medi-Cal: beneficiary maintenance needs: home upkeep allowance. SUMMARY: Establishes the home upkeep allowance (HUA) for certain Medi-Cal eligible long-term care facility residents, and sets requirements for the allowance, as specified. Specifically, this bill: 1)Requires a HUA to be available to certain long-term care facility residents to use for the maintenance or establishment of a residence following their departure from a facility. 2)Requires a physician to determine the likelihood of a resident's ability to return to the community. 3)Establishes eligibility requirements for individuals to receive the HUA, and specifies maximum values and eligible uses of the HUA. AB 1235 Page 2 4)Requires the Department of Health Care Services (DHCS) to perform specified outreach with respect to the HUA. EXISTING LAW: 1)Establishes the Medi-Cal program to provide comprehensive health benefits to low-income individuals who meet specified eligibility criteria. 2)Requires DHCS to establish the income levels for maintenance need at the lowest levels that reasonably permit medically needy persons to meet their basic needs for food, clothing, and shelter, and for which federal financial participation will still be provided under Title XIX of the federal Social Security Act. FISCAL EFFECT: This bill has not yet been analyzed by a fiscal committee. COMMENTS: 1)PURPOSE OF THIS BILL. The author states the reason why many individuals stay in nursing facilities indefinitely is in part because the current HUA is insufficient to sustain the cost of basic living needs. The author explains that the HUA is underutilized due to the high cost of living in California, as compared to other states, and the lack of affordable housing programs. The author concludes that with the increase in the HUA, this bill will improve the quality of life for Medi-Cal recipients in nursing homes and provide greater opportunities AB 1235 Page 3 for individuals to transfer back into the community. 2)BACKGROUND. a) Long-term care in California. In 2007, California was home to 4 million persons age 65 and older or representing 11% of the state's population. In 2010, the number of Californians age 65 and older is projected to increase to 4.4 million or 14.7%, and is projected to increase to 8.3 million or 17.8% of all Californians in 2030. Approximately 2.4 million persons in California report having two or more disabilities and an estimated 400,000 plus have intellectual or developmental disabilities. Long-term care services generally address an individual's health, social, and personal needs, and are provided in institutional care settings (for example, skilled nursing facilities) and through community-based providers ranging from nonmedical residential care facilities to services such as transportation and meals to help individuals remain in their homes instead of being placed in an facility. Long-term care services are provided not only to the elderly (age 65 and older), but also to younger persons with developmental, mental, and/or physical disabilities. Many of the persons eligible for long-term care services use multiple services provided by a variety of programs operated by many state departments. Within California, DHCS and the Departments of Aging, Health Care Services, Social Services, Developmental Services, Mental Health, Rehabilitation, and Veterans Affairs directly administer long-term care programs. b) Current standards of the HUA. Maintaining or establishing a home in the community is a major obstacle for Medicaid beneficiaries who want to return home after admission to an institution. Medicaid eligibility rules AB 1235 Page 4 give states the flexibility to support this goal and allow states to exempt income to maintain a home. The HUA is a Medi-Cal deduction for qualifying Medi-Cal beneficiaries who are living in, or will be living in, a nursing home or other medical facility. The HUA currently allows beneficiaries to keep $209 per month of their monthly income for maintenance and upkeep of their homes while they are temporarily residing in the nursing home other medical facility. The HUA can be allowed for up to a six month period from the date the beneficiary enters the nursing home. To qualify for the HUA, a beneficiary must meet all of the following requirements: i) Intend to leave the nursing facility and to return home within six months of the date the individual begins living in the nursing home. ii) Obtain a written medical statement from the individual's doctor certifying that he or she will be able to return home within six months. iii) The spouse or family of the individual must not live in the home. iv) The home must be maintained for the individual's return. Medically needy Medi-Cal beneficiaries who enter a nursing facility apply all their income above a personal needs allowance to the cost of care. State regulations allow beneficiaries to retain 133% of the in-kind value of housing for one person if the applicant or beneficiary has been living alone in the home. AB 1235 Page 5 3)SUPPORT. Disability Rights California, the sponsor of the bill, states the current allowance given to long-term care facility residents for the maintenance of their homes is insufficient and highlights the rate has not been updated since the 1970's. In addition, the sponsor states individuals are taking full advantage of existing allowances for home maintenance because they are not aware of its existence. Finally, the sponsor states the allowance is too restrictive and does not meet the needs of long-term care residents; for example, it does not allow for residents who lost their homes but want to find a new home to leave the facility. The sponsor states the bill will allow for the HUA to be a useful tool to help patients move into more home- and community-based settings. Supporters of the bill state the provisions will allow people to better preserve their residences and will result in significant cost savings to the state. The supporters content that by calculating the HUA using the actual cost of maintaining a patient's home, the bill will ensure that a greater number of individuals who are eligible to return to their homes will have a home to return to. 4)RELATED LEGISLATION. AB 1319 (Dababneh) raises the current $20 per month incidental needs deduction to $50 for Medi-Cal beneficiaries who qualify for personal and incidental needs deductions and are residing in a community care facility, provided all necessary federal approvals can be obtained. AB 1319 is set for hearing in this Committee on April 28, 2015. 5)POLICY COMMENTS. This bill establishes standards for a home upkeep allowance to be available for certain long-term care facility residents. The Committee may suggest a number of amendments to clarify the bill language in a future committee, as follows: AB 1235 Page 6 a) This bill establishes the HUA in statute and requirements for the allowance. However, state regulations already define requirements for home maintenance income for long-term residents. The current language of the bill appears to create an allowance that would be supplemental to the existing home maintenance income; however the author has indicated the intent of this bill appears to be to supplant existing requirements with new regulations for this income. The Committee may suggest amending the language to clarify the intent and providing defined guidance to DHCS for the interaction of these two allowances. b) This bill specifies the HUA will apply to certain long-term care facility residents. The Committee may suggest specifying which types of long-term care facility residents the HUA will apply to, and the associated criteria for eligibility. c) This bill requires DHCS to perform outreach regarding the HUA. The language of the bill is currently confusing with regard to the requirements on the adoption of regulations for this outreach and related standards. The Committee may suggest amending this bill to clarify these standards in statute. d) This bill requires DHCS to adopt or revise regulations as necessary to reflect the requirements of this section; however the bill provision appears to be incorrectly placed within the language. The Committee may suggest amending this bill to ensure this requirement applies to the entirety of the bill language. AB 1235 Page 7 REGISTERED SUPPORT / OPPOSITION: Support Disability Rights California (sponsor) California Advocates for Nursing Home Reform (prior version) California Association of Public Authorities for IHSS (prior version) California Commission on Aging (prior version) California Long-Term Care Ombudsman Association (prior version) County Board of San Bernardino (prior version) United Domestic Workers of America / AFSCME Local 3930 / AFL-CIO (prior version) Opposition None on file. Analysis Prepared by:An-Chi Tsou / HEALTH / (916) 319-2097 AB 1235 Page 8