BILL ANALYSIS Ó
SENATE COMMITTEE ON HEALTH
Senator Ed Hernandez, O.D., Chair
BILL NO: AB 1235
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|AUTHOR: |Gipson |
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|VERSION: |June 1, 2015 |
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|HEARING DATE: |July 1, 2015 | | |
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|CONSULTANT: |Scott Bain |
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SUBJECT : Medi-Cal: beneficiary maintenance needs: home upkeep
allowances and transitional personal needs funds.
SUMMARY : Requires the home upkeep allowance (HUA) for eligible Medi-Cal
beneficiaries in long-term care facilities to be based on the
actual minimum cost of maintaining the resident's home (the HUA
is currently $209 a month). Allows a long-term care facility
resident who does not have a home to establish a transitional
personal needs fund of up to $7,500 to be set aside from the
income that otherwise would be applied toward the resident's
Medi-Cal share of cost for residing in the long term care
facility. The personal needs fund would be used to cover the
costs of securing a home for the individual.
Existing law:
1)Establishes the Medi-Cal program, which is administered by the
Department of Health Care Services (DHCS), under which
qualified low-income individuals receive health care services.
Qualified individuals under the Medi-Cal program include
medically needy persons and medically needy family persons who
meet the required eligibility criteria, including applicable
income requirements.
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
(FFP) will still be provided under federal Medicaid law. (The
medically needy Medi-Cal eligibility category are individuals
who fit into a federal benefit program category but whose
income or resources exceed eligibility levels. Medically needy
individuals become Medi-Cal eligible by having a share of cost
whereby the individual "spends down" to Medi-Cal eligibility
AB 1235 (Gipson) Page 2 of ?
levels.)
3)Requires, for a Medi-Cal beneficiary in a medical institution
or nursing facility, the amount considered as required for
maintenance per month to be computed in accordance with, and
for those purposes required by federal Medicaid law and
regulations. Requires those amounts to be computed pursuant to
regulations which include providing for the following
purposes:
a) Personal and incidental needs in the amount of
not less than $35 per month while a patient. This is
referred to as the "personal needs allowance." Permits
DHCS to increase this amount, by regulation, as
necessitated by increasing costs of personal and
incidental needs. Prohibits a long term care (LTC)
facility from charging an individual for the laundry
services or periodic hair care; and,
b) The upkeep and maintenance of the home. (This
amount is referred to as the home upkeep allowance.)
4)Establishes, through regulation, the HUA, which allows a
Medi-Cal beneficiary in a LTC facility to be able to retain an
amount of income for upkeep of a home in addition to the
personal and incidental needs allowance, if all of the
following conditions are met:
a) The LTC patient's spouse or a family member of
the LTC patient is not living in the home;
b) The home, whether rented or owned by the LTC
patient, is actually being maintained for the return
of the LTC patient;
c) There is a verified medical determination that
the LTC patient, or when both spouses are in LTC,
either spouse, is likely to return home within six
months of the date LTC patient status was established;
and,
d) The income is deducted for not more than the
six-month period.
5)Establishes, through regulation, a formula for determining the
amount of the HUA.
This bill:
AB 1235 (Gipson) Page 3 of ?
1)Requires the HUA to be available to LTC recipients who are
Medi-Cal recipients and meet the requirements of this bill.
2)Requires a LTC facility resident who intends to leave the
facility and return to his or her existing home to be provided
with a HUA as follows:
a) Requires the allowance to be set aside from
the income that otherwise would be applied toward the
resident's Medi-Cal share of cost (SOC) for residing
in the facility;
b) Requires the allowance to be based on the
actual minimum cost of maintaining the resident's
home, including, but not limited to, mortgage or rent,
property taxes, and required insurance;
c) Requires the allowance to be an exempt
resource for purposes of determining eligibility for
the Medi-Cal program; and,
d) Requires the allowance to be available only if
a physician has certified that the resident is likely
to return to his or home within six months.
3)Requires a transitional personal needs fund to be available to
long-term care recipients if a long-term care facility
resident does not have a home, but intends to leave the
facility and establish a home in the community. Requires the
transitional costs of establishing a home to be included in
his or her personal needs allowance.
4)Permits a resident to establish a transitional personal needs
fund, as follows:
a) Requires the fund to be set aside from the
income that otherwise would be applied toward the
resident's Medi-Cal SOC for residing in the facility;
b) Caps the total amount of the fund at $7,500;
c) Requires the fund to be an exempt resource for
purposes of determining eligibility for the Medi-Cal
program; and,
d) Requires the fund to be used to cover the
costs of securing a home for the individual,
including, but not limited to, rent, security and
utility deposits, accessibility modifications
necessary to meet the needs of the individual, and
essential furnishings, including, but not limited to,
AB 1235 (Gipson) Page 4 of ?
stoves, refrigerators, beds, towels, and bed linens.
5)Requires, if the resident is unable to secure a home within
four months after the transitional personal needs fund has
reached the $7,500 amount, the fund to revert to the state to
defray the costs of the resident's care in the facility.
6)Requires DHCS, in implementing this bill, to undertake all of
the following information and outreach activities:
a) Inform residents in all Medi-Cal funded LTC
facilities of the existence and availability of the
HUA and the transitional needs personal needs fund;
b) Include information on the existence and
availability of the HUA and the transitional personal
needs fund in the "Notice Regarding Standards for
Medi-Cal Eligibility;" and,
c) Notify all Medi-Cal branches, eligibility
workers, LTC facilities, hospital discharge planners,
and organizations receiving state funds to assist
nursing home residents of the existence and
availability of the HUA and the transitional personal
needs fund.
7)Requires DHCS to adopt, revise, or repeal regulations as
necessary to implement this bill. Requires regulations that
are inconsistent with this bill to be inoperative until DHCS
makes the regulatory changes required by this subdivision.
FISCAL
EFFECT : The current version of this bill has not been analyzed
by a fiscal committee.
PRIOR
VOTES :
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|Assembly Floor: |79 - 1 |
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|Assembly Appropriations Committee: |17 - 0 |
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|Assembly Health Committee: |19 - 0 |
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AB 1235 (Gipson) Page 5 of ?
COMMENTS :
1)Author's statement. According to the author, AB 1235 seeks to
improve the quality of life for Medi-Cal recipients in nursing
facilities by increasing the HUA and providing greater
opportunities for people to transfer back into a community.
The current HUA is $209 a month, which is simply insufficient
to provide for the maintenance and upkeep of most homes in
California. This bill seeks to increase the allowance to
ensure that nursing facility residents have an allocation that
is enough for them to establish a home and will also save the
state in long-term costs. Each resident who is able to
transition out of a nursing home is one less resident that the
state has to cover the high cost of nursing facility care
under Medi-Cal. In addition, even if residents continued to
use publicly funded services, such as IHSS, it would still be
less expensive and would save money in the long-term. This
recommendation came out of a report commissioned by the
California Health and Human Services Agency in 2009, entitled,
Home and Community-Based Long-Term Care: Recommendations to
Improve Access for Californians.
2)Medi-Cal share of cost, HUA and personal needs allowance.
Medi-Cal provides coverage up to 138% of the federal poverty
level for parents and individuals age 65 and under (at or
below $1,354 a month for a single person and at or below
$21,187 for two people) at no cost. In addition, Medi-Cal
provides coverage for to individuals who are aged or disabled
up to of the 102% of the Federal Poverty Level (at or below
$1,200 a month for an individual) at no cost.
Individuals whose income exceeds the income levels or who do not
meet eligibility criteria for no-cost Medi-Cal can quality as
medically needy individuals. The medically needy program is a
way to extend Medi-Cal eligibility to individuals who do not
qualify for no-cost Medi-Cal, such as those with high medical
expenses whose income is too high to meet the income
eligibility threshold for no-cost Medi-Cal. The program
functions as a last resort for those whose incomes are modest
and are surpassed by their significant medical expenses.
Federal Medicaid law authorizes states to have an optional
deduction as allowance for home maintenance. California has
adopted this option, whereby Medi-Cal beneficiaries living in,
or who will be living in, a nursing home or other medical
facility can qualify for a Medi-Cal deduction called the HUA.
AB 1235 (Gipson) Page 6 of ?
The Medi-Cal HUA enables a beneficiary to keep $209 a month of
the individual's income for the maintenance and upkeep of the
person's home while the individual is temporarily residing in
the nursing home or other medical facility. To be eligible, a
LTC resident must have a home (whether rented or owned) that
is actually being maintained for the return of the LTC
patient, and there must be a verified medical determination
that the LTC patient is likely to return home within six
months. The HUA allowance can be allowed for up to a six month
period from the date the individual enters the nursing home.
DHCS does not have data on the number of individuals using the
HUA but the number is believed to be small. A 2008 paper
prepared for the state Olmstead Advisory Committee indicated
the Medi-Cal Eligibility Data System does not capture
information on who utilizes the HUA, but a survey of counties
identified low numbers of reported cases, and DHCS estimated
that 100 beneficiaries statewide claimed the HUA in any given
month.
Individuals likely to use the HUA are more likely to be single
adults as current regulations prohibit the LTC's patient's
spouse or family member from living in the beneficiary's home.
In addition, the resources and income of a Medi-Cal nursing
home resident with a spouse or dependent at home (referred to
as the "community spouse") is treated differently from that of
a resident who has no spouse or dependent in the home. If a
nursing home resident on Medi-Cal has a community spouse
living at home, the community spouse is allowed to keep a
greater amount of the family income and assets in order that
he or she does not become impoverished. In contrast, a single
person with no spouse or dependent at home can retain only the
$35 for personal and incidental needs when the beneficiary
will reside in the facility for the entire month. This is also
called the "personal needs allowance." The state does not have
a transitional personal need fund as an exemption or deduction
from income in determining a beneficiary's Medi-Cal SOC as
this bill proposes.
The personal needs deduction and HUA are deducted from the
individual's income in determining their share of cost for
LTC. For example, if an individual with a monthly income of
$1,300 who is residing in a skilled nursing facility (SNF)
would have the $35 personal needs deduction and $209 home
upkeep allowance subtracted from his or her monthly income
AB 1235 (Gipson) Page 7 of ?
($1,300 - $35 - $209 = $1,056). The remaining amount of $1,056
would be the individual's monthly SOC.
3)Related legislation. AB 1319 (Dababneh), increases the
personal and incidental needs deduction for Medi-Cal
beneficiaries residing in a licensed community care facility
from $20 to $50. AB 1319 is currently pending in the Senate
Rules Committee.
4)Support. This bill is sponsored by Disability Rights
California (DRC) to help people who are in nursing homes
return to the community if that is their preference. DRC
writes that people trying to leave nursing homes face daunting
challenges, and none is more daunting than lack of affordable
accessible housing. DRC states that, as California seeks
federal funds to develop new housing, it also forces people to
lose the homes they already have when they enter a SNF, in a
policy which hasn't changed since the 1970s. This means that
people who can go home end up languishing in these facilities,
with the state paying ever-rising Medi-Cal SNF rates, in
contradiction of the wishes and civil rights of the residents,
fiscal responsibility, and common sense.
DRC explains that Medi-Cal beneficiaries who go into nursing
homes have to turn over some of their income as a SOC if their
income exceeds certain levels, and depending on whether there
is a spouse living in the family home. Federal Medicaid law
allows an alternative for people who intend to return home can
use that SOC money to maintain their home. DRC states the
problem with the current $209 HUA is it is unchanged since the
1970s and the amount is insufficient. DRC states this bill
makes the home upkeep allowance a useful tool by tying the
allowance to the HUA amount to what is actually needed to
maintain the beneficiary's home as anything less than that
does not achieve the desired policy outcome. In addition, this
bill requires the state to publicize the HUA to nursing home
residents, prospective residents, discharge planners, and
Medi-Cal offices, as the existence of the HUA is not widely
known.
In addition to being an inadequate dollar amount, DRC states
the HUA does not help people who lost their homes but want to
find a new home and leave a long-term care facility. This bill
proposes a new transitional personal needs fund that would be
AB 1235 (Gipson) Page 8 of ?
deducted from the long-term care Medi-Cal beneficiary's SOC so
they can save income for up to three months to secure a home
or apartment. DRC states individual can accumulate up to
$7,500 (this amount was chosen because it is the maximum grant
amount in the California Community Transitions program), and
if the money is not used, it would revert to the state General
Fund. DRC states Medi-Cal would make up the beneficiary's SOC
so the nursing home would be made whole, and the short-term
cost of the new fund would be far outweighed by the cost
savings as people are able to leave facilities and use
community-based services, which are almost always less costly.
5)Recommended amendment. This bill creates a new code section
but the provisions are not contingent upon the changes made by
this bill being contingent upon receipt of federal Medicaid
matching funds (commonly referred to as financial
participation) and federal approval. Staff recommends this
change be made to this bill.
6)Policy questions.
a) Should there be an upper limit on the HUA? The HUA
enables a beneficiary to keep $209 a month of his/her
income for the maintenance and upkeep of their home while
the individual is temporarily residing in the nursing
home or other medical facility. DHCS did not have data on
the number of individuals using the HUA allowance but the
number is generally believed to be very low as this
option is not well known. Instead of the current $209
established through a formula in regulation, this bill
would set in statute the allowance as an amount based on
the actual minimum cost of maintaining the resident's
home, including, but not limited to, mortgage or rent,
property taxes, and required insurance. A 2009 report
prepared for California Community Choices and the CA
Health and Human Services Agency indicated the existing
$209 is too low to maintain a home in California.
The argument for not having a fixed dollar amount is that
is insufficient, and it prevents the option from being
usable as a low dollar amount is considerably less than
the typical cost of mortgage or rent payments. Increasing
the HUA will allow institutionalized individuals to keep
more income for maintenance and upkeep of their home,
would provide with individual with enough income to be
helpful in offsetting rental/mortgage costs, and an
AB 1235 (Gipson) Page 9 of ?
increased HUA deduction would enable more people to be
able to return home when discharged.
b) Federal Medicaid law requires states to have a
personal needs allowance that is reasonable in amount for
clothing and other personal needs of the individual while
in the institution, and establishes minimum amounts. For
an aged, blind or disabled individual, the amount must be
at least $30 and $60 for an institutionalized couple if
both spouses are aged, blind, or disabled. For other
individuals, the personal needs allowance must a
reasonable amount set by the agency, based on a
reasonable difference in their personal needs from those
of the aged, blind, and disabled. The current California
personal needs allowance is $35.
This bill establishes a new transitional personal needs
fund, caps the amount in the fund at $7,500, and requires
money in the fund to be set aside from the income that
otherwise would be applied toward the resident's Medi-Cal
SOC for residing in the facility. While federal law
requires the use of an allowance, federal law is silent
on the creation of a fund. The bill sponsor indicates the
Health Care Financing Administration (the predecessor to
CMS) has granted states flexibility in determining what
is an exempt resource for Medicaid eligibility purposes.
Does federal Medicaid law permit the establishment of a
fund, as this bill proposes?
SUPPORT AND OPPOSITION :
Support: Disability Rights California (sponsor)
American Federation of State, County and Municipal
Employees
California Advocates for Nursing Home Reform
California Association of Public Authorities for IHSS
California Commission on Aging
California Senior Legislature
Contra Costa Advisory Council on Aging
Oppose: None received
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AB 1235 (Gipson) Page 10 of ?