BILL ANALYSIS                                                                                                                                                                                                    Ó



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          Date of Hearing:  April 21, 2015


                   ASSEMBLY COMMITTEE ON AGING AND LONG-TERM CARE


                                 Cheryl Brown, Chair


          AB 1261  
          (Burke) - As Introduced February 27, 2015


          SUBJECT:  Community-based adult services:  adult day health care  
          centers


          SUMMARY:  Establishes Community Based Adult Services Program  
          benefits as statutorily authorized Medi-Cal benefits.   
          Specifically, this bill:  


          Makes legislative findings and declarations that:


          1)California supports the dignity, independence and choice of  
            seniors and persons with disabilities to live in the most  
            integrated setting appropriate, and to be free from  
            institutionalization, unless necessary.


          2)The populations of persons 65 and older, and those afflicted  
            with Alzheimer's are anticipated to grow exponentially by  
            mid-century compared to the general population, as will the  
            costs associated with caring for them.


          3)The US Census places the number of older adults in California  
            as higher than any other state, and that the California  








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            Department of Aging now reports that those 60 and over make-up  
            one-in-five Californians - 40 percent of whom are living with  
            a disability, many of whom represent diverse ethnic and  
            cultural heritage.


          4)Adult Day Health Care (ADHC) was established in California in  
            1974 as a licensed alternative to nursing home care that  
            afforded participants challenged with Alzheimer's disease,  
            diabetes, high blood pressure, mental health needs, traumatic  
            brain injuries, stroke or breathing problems (to name a few)  
            the option to remain members of their communities by accessing  
            necessary services and supports from a multidisciplinary team  
            of professionals in a clinical day-time setting as needed, and  
            then returning to home, rather than permanently moving into a  
            nursing home.


          5)ADHC also provides family caregivers support as a mechanism to  
            reduce unnecessary institutionalization, and reducing the risk  
            for abusive environments to develop.


          6)ADHC services include health, therapeutic, and social services  
            such as transportation; care otherwise only available to  
            recipients in a nursing home; physical, occupational and  
            speech therapy; health supervision, mental stimulation, and  
            nutrition.  


          7)ADHC provides such services at an average annual cost of about  
            $9,312.  Annual skilled nursing home care in California, an  
            alternative to Community Based Adult Services (CBAS)/ADHC,  
            currently averages about $83,364 according to the California  
            Medicaid Research Institute.


          8)ADHC centers which provide CBAS services are licensed by the  
            Department of Public Health and overseen by the Departments of  








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            Aging, and Health Care Services.


          9)Since 1977 California has documented unmet needs for ADHC when  
            a report identified a need for 600 sites statewide.  At its  
            peak, California supported 360 sites, providing care to only  
            40,000 medically fragile Californians while approximately  
            300,000 individuals gained their care in nursing homes.  By  
            2013, a total of 270 ADHC centers were in business serving  
            just 28,777 people while annual nursing home census remains at  
            about 300,000.


          10)Residents in 32 of California's 58 counties do not have  
            access to ADHC centers.


          11)ADHC benefits were available as a Medi-Cal optional benefit,  
            though eliminated as an initiative intended to help the state  
            manage California's fiscal crisis in the Budget Act 


          of 2011.
          12)Consumers concerned about imminent institutionalization, sued  
            to preserve the benefit citing ADHC as the only barrier to  
            their eventual and undesired institutionalization, a process  
            that the United State Constitution guarantees protection from,  
            based upon the Olmstead Vs L.C. Supreme Court Decision.


          13)Upon settlement, DHCS extended services to recipients via a  
            waiver authorized under Section 1115 of the Social Security  
            Act, through October 31, 2015.


          14)Given California's anticipated demographic trends indicate  
            growth of the 65+ population far more rapid than the growth of  
            the general population through 2050, the need and demand for  
            ADHC centers and the CBAS services that they provide is  








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            critical to a successful strategy to contain and control  
            costs, and as a strategy to meet families' needs, and as a  
            strategy to assure success of the Coordinated Care Initiative.


          15)Codification of the CBAS program is necessary to provide the  
            stability required to meet the growing needs of the expanding  
            aged populations.


          16)Adds language to the Welfare and Institutions Code describing  
            CBAS benefits, eligibility criteria, beneficiary  
            characteristics, provider characteristics and requirements,  
            and declares them a permanent Medi-Cal benefit.


          EXISTING LAW:  


          1)Establishes the Medi-Cal program, a free or low-cost health  
            care service for families, seniors, persons with disabilities,  
            children in foster care, pregnant women, and childless adults  
            with incomes below 138 percent of federal poverty level (FPL).  
             Benefits include ambulatory patient services, emergency  
            services, hospitalization, maternity and newborn care, and  
            long term services and supports.  Medi-Cal is administered  
            through federal-state-county partnerships with the federal  
            Centers for Medicare and Medicaid Services (CMS), the  
            California Department of Health Care Services (DHCS), and  
            county welfare departments in each of the 58 counties.  



          2)Establishes the Coordinated Care Initiative in Alameda, Los  
            Angeles, Orange, Riverside, 


          San Bernardino, San Diego, San Mateo, and Santa Clara counties  
            which begins the process of integrating the delivery of  








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            medical, behavioral, and long-term services and supports while  
            attempting to integrate Medicare and Medi-Cal for people in  
            both programs, known as "dual eligible" beneficiaries.   
            Consumers at the local delivery points know the program as  
            "Cal MediConnect," while policy makers in Sacramento know the  
            program best as "Coordinated Care Initiative."
          3)Authorizes DHCS to enter into contracts with managed care  
            organizations to provide services to Medi-Cal enrollees.


          4)Requires specified Medi-Cal recipients to enroll in Medi-Cal  
            managed care plans in the eight counties participating in the  
            Coordinated Care Initiative/Cal Medi-Connect.


          5)Provides for CBAS benefits under the "California Bridge to  
            Reform" waiver authorized by Section 1115 of the Social  
            Security Act which promotes states to test innovative payment  
            and service delivery models to reduce program expenditures  
            while preserving or enhancing the quality of care.


          FISCAL EFFECT:  Unknown.


          COMMENTS:  


          Author's Comment:  Over 30,000 frail Californians and their  
          families depend upon the adult day health care services provided  
          through the CBAS program.  While the current federal waiver  
          ensures that the program will continue for the next few years,  
          the waiver did not include language to ensure that providers  
          will be reimbursed at levels that are not less than current  
          Medi-Cal fee-for-service rates, and state law has not been  
          updated to reflect the program requirements under the waiver and  
          guarantee legislative oversight.  AB 1261 preserves access to  
          the adult day health care services and gives providers a  
          reliable rate structure to ensure program sustainability.  








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          Background:  For many years, Adult Day Health Care (ADHC) was a  
          state plan optional benefit of the Medi-Cal program.  The  
          program was eliminated in 2011 as a result of the state budget  
          crisis.  A subsequent class action lawsuit, Esther Darling, et  
          al. v. Toby Douglas, et al., challenged the elimination of ADHC  
          as a violation of the Supreme Court decision Olmstead v. L.C.   
          The state settled the lawsuit, agreeing to replace ADHC services  
          with a new program called CBAS effective April 1, 2012, to  
          provide necessary medical and social services to individuals  
          with intensive health care needs.  





          The Department of Health Care Services (DHCS) amended the  
          "California Bridge to Reform" 1115 Waiver to include the new  
          CBAS program, which was approved by the Centers for Medicare and  
          Medicaid Services on March 30, 2012.  Today, in counties that  
          have implemented Medi-Cal managed care, CBAS is available as a  
          managed care benefit.  In counties that have not implemented  
          Medi-Cal managed care, or for individuals that are exempt from  
          enrollment in Medi-Cal managed care, CBAS is provided as a  
          fee-for-service Medi-Cal benefit.  





          While the waiver covers services, state statutes have not been  
          updated to reflect the new parameters of the CBAS program under  
          the waiver.  In addition, the transition to managed care  
          coverage for CBAS has led to rate uncertainty.  While the  
          original settlement and draft waiver language included  
          provisions to ensure that CBAS services provided through managed  
          care plans were reimbursed at rates that are not less than  
          Medi-Cal fee-for-service rates, the final waiver application and  








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          consequently the approved waiver requirements did not include  
          the rate language.  


          Arguments in Support:  Disability Rights California writes that  
          AB 1261 preserves an essential health benefit to over 28,000  
          Medi-Cal recipients with serious health conditions that place  
          them at risk of losing their independence and facing life in a  
          nursing home - a life-style they do not wish to endure, and one  
          that will ultimately cost the state more.  CBAS serves as an  
          important service that demonstrates the state's commitment to  
          the principles of the Olmstead decision, and the objectives of  
          the nascent Coordinated Care Initiative in counties where it is  
          underway.  


          The Alzheimer's Association writes that AB 1261 offers important  
          stabilization of the CBAS service delivery system, an essential  
          service for people with Alzhiemer's disease, and the families  
          who care for them.  The Alzheimer's Association cites Medicaid  
          claims data showing that costs are 19 times higher for  
          individuals with cognitive impairments.  


          Justice in Aging (formerly National Senior Citizens Law Center)  
          cites AB 1261 as an important effort to assure that California  
          implements the Supreme Court's Olmstead decision to ensure frail  
          California seniors and people with disabilities can live on  
          their own with dignity and independence, rather than costly  
          nursing home care.  


          Arguments in Opposition:  None.


           Dual Referral:


           AB 1261 was heard by the Assembly Health Committee on April 14,  








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          2015, and passed by a vote of 16-0-3.  (Ayes: Bonta,  
          Maienschein, Burke, Chávez, Chiu, Gomez, Gonzalez, Lackey,  
          Nazarian, Patterson, Ridley-Thomas, Rodriguez, Santiago,  
          Thurmond, Waldron, Wood.  


          Noes: None.  No Vote Recorded: Bonilla, Roger Hernández,  
          Steinorth).  



          Previous Legislation:





          1)AB 1552 (Lowenthal) - vetoed by the Governor in 2014 - would  
            have codified the CBAS program to reflect the waiver  
            requirements.  



          2)AB 518 (Yamada) - held in Senate Health in 2013 - extends the  
            CBAS program as a Medi-Cal benefit through Medi-Cal managed  
            care, however, allows only non-profit providers to enroll as  
            CBAS providers.  





          3)SB 1008 (Committee on Budget and Fiscal Review), Chapter 33,  
            Statutes of 2012 and 


          SB 1036 (Committee on Budget and Fiscal Review), Chapter 45,  
            Statutes of 2012 authorize the Coordinated Care Initiative  
            (CCI) as an eight-county pilot project to: i) integrate  








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            Medi-Cal and Medicare benefits under managed care for dual  
            eligibles; and, ii) integrate Long Term Services and Supports  
            (LTSS) under managed care for dual eligibles and Medi-Cal-only  
            Seniors and People with Disabilities (SPD).  



          4)AB 96 (Committee on Budget) - vetoed by the Governor in 2011 -  
            would have established the Keeping Adults Free of Institutions  
            (KAFI) program, and required Department of Health Care  
            Services (DHCS) to submit an application to Centers for  
            Medicare and Medicaid Services (CMS) to implement the program.  
             





          5)AB 97 (Committee on Budget), Chapter 3, Statutes of 2011,  
            among other provisions eliminates Adult Day Health Care (ADHC)  
            as a Medi-Cal benefit.  





          6)SB 208 (Steinberg), Chapter 714, Statutes of 2010, contains  
            the provisions implementing Section 1115(b) Medicaid  
            Demonstration Waiver from CMS entitled "A Bridge to Reform  
            Waiver."  Among the provisions, this waiver authorized  
            mandatory enrollment into a Managed Care Plan (MCP) of over  
            600,000 low-income Seniors and People with Disabilities who  
            were eligible for Medi-Cal only (not Medicare) in 16 counties.  
             













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          7)AB 2073 (Lowenthal) - held in Assembly Appropriations in 2013  
            - narrowed eligibility for Adult Day Health Care to conform to  
            the court's decision in Cota (formerly "Brantley") v.  
            Maxwell-Jolly, 656 F. Supp. 2d 1161 (N.D. Cal. 2009) (Cota v.  
            Maxwell-Jolly) and achieve the same level of savings.  





          8)ABX4 - 5 (Evans), Chapter 5, Statutes of 2009-10 Fourth  
            Extraordinary Session; enacted new, more restrictive  
            eligibility criteria.  The narrowed eligibility was eventually  
            challenged in court in Cota (formerly "Brantley") v.  
            Maxwell-Jolly.  





          9)SB 117 (Corbett), Chapter 165, Statutes of 2009, extended the  
            deadline by which the Department of Health Care Services was  
            required to establish a new Medi-Cal rate reimbursement  
            methodology for Adult Day Health Care, from August 1, 2010 to 


          August 1, 2012.  



          10)AB 572 (Berg), Chapter 648, Statutes of 2008 clarified  
            requirements pertaining to Adult Day Health Care hours of  
            service, core staff, and staff absences, transportation  
            services, and meal requirements.  













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          11)SB 1755 (Chesbro), Chapter 691, Statutes of 2006, established  
            new eligibility criteria for Adult Day Health Care (ADHC)  
            services for the purposes of Medi-Cal reimbursement, required  
            the Department of Health Services, (now DHCS), to establish a  
            cost-based Medi-Cal reimbursement methodology for AHDC  
            services, and established daily core services to be provided  
            by ADHC centers to each participant.  


          


          REGISTERED SUPPORT / OPPOSITION:




          Support


          Adult Day Health Care of Mad River


          Alzheimer's Association


          Ararat Adult Day Health Care Center


          Association of California Healthcare Districts (ACHD)


          Avenidas


          Bay Area Community Services


          California Association for Adult Day Services (CAADS)








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          California Association of Public Authorities (CAPA)


          California Commission on Aging (CCoA)


          California Medical Association (CMA)


          Casa Pacifica Adult Day Health Care Center


          Congress of California Seniors


          Disability Rights California


          Justice in Aging


          LeadingAge California


          Meals-on-Wheels Greater San Diego, Inc.


          New Life Adult Day Health Care


          Partners in Care Foundation


          San Fernando Valley Adult Day Health Care, LLC


          San Francisco Department of Aging and Adult Services








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          San Ysidro Health Center


          Sunny Cal Adult Day Health Care Center, Inc.


          Sunny Day Adult Community Based Adult Services


          United Domestic Workers of America (UDW)


          Two individuals.




          Opposition


          None on file.




          Analysis Prepared by:Robert MacLaughlin / AGING & L.T.C. / (916)  
          319-3990


















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