BILL ANALYSIS Ó
AB 1518
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Date of Hearing: April 21, 2015
ASSEMBLY COMMITTEE ON HEALTH
Rob Bonta, Chair
AB 1518
(Committee on Aging and Long-Term Care) - As Amended March 26,
2015
SUBJECT: Medi-Cal: nursing facilities.
SUMMARY: Requires the Department of Health Care Services (DHCS)
to authorize an additional 5,000 slots beyond current standards
for home and community-based patients, and updates requirements to
the Nursing Facility/Acute Hospital (NF/AH) Waiver, as specified.
Provides this bill only be implemented to the extent that DHCS can
demonstrate fiscal neutrality within the DHCS budget and
implementation is contingent on federal approval. Specifically,
this bill:
1)Requires, by January 1, 2016, nursing home facilities to
authorize an additional 5,000 slots beyond those currently
authorized for home and community-based NF/AH Waiver. Requires
DHCS to consider specified factors to calculate the need for,
and seek federal approval of, additional slots to the waiver.
2)Updates requirements regarding the NF/AH Waiver to expedite the
Waiver application process and clarify level of care for
patients, as specified.
3)Requires DHCS to ensure a seamless transition for patients
receiving private duty in-home nursing provided through the
Early Periodic Screening, Diagnosis and Treatment program to
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medically necessary in-home nursing once a patient turns 21
years of age.
4)Adds new services to the NF/AH Waiver and adjusts the cost
limitation category of the Waiver to use an aggregate cost limit
formula, as specified.
EXISTING LAW:
1)Establishes the Medi-Cal Benefits Program under the direction of
DHCS, to provide qualifying individuals health care and a
uniform schedule of benefits;
2)Allows DHCS to request the federal Centers for Medicare and
Medicaid Services (CMS) for increased services in the home- and
community-based waiver for nursing facilities, including the
addition of 500 slots beyond what is currently authorized for
the home- and community-based level A/B nursing facility and
other services, as specified;
3)Requires DHCS to consider expanding the number of waiver slots
upon renewal of the waiver.
FISCAL EFFECT: This bill has not yet been analyzed by a fiscal
committee.
COMMENTS:
1)PURPOSE OF THIS BILL. According to the author, California's
NF/AH Waiver program does not currently meet the needs of
seniors and youth with disabilities who wish to receive services
at home, and avoid nursing homes and other institutions. The
author states that home-based services are typically less
expensive, more desirable to the clients and their families, and
consistent with state and federal priorities; however current
state policies and limited funding and flexibility prevent
individuals from being moved from institutions to home-based
care. In addition, the author asserts that upon turning 21,
many individuals, who received home care prior to their 21st
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birthday, are forced into institutions because they become
ineligible due to age restrictions for specified services.
2)BACKGROUND.
a) Home- and Community-Based Waivers. The federal Medicaid
Act requires states to administer their Medicaid programs
according to federal law and regulations in order to protect
beneficiaries. However, Congress may grant waivers of
certain laws and regulations in order to help states better
meet their individual needs. The home- and community-based
waivers primarily promote coverage and services which enable
individuals who would otherwise be institutionalized to live
in the community or at home.
The NF/AH Waiver is a 1915(c) Home and Community-Based Services
Waiver that provides community-based alternatives to Medi-Cal
eligible individuals who would otherwise be receiving care in
either an acute hospital, adult or pediatric subacute
facility, nursing facility, or distinct-part nursing
facility. There is no age limit for waiver services. The
Waiver is available to individuals who are currently residing
in an institution but wish to transition to his/her home and
community, as well as to individuals who reside in the
community, but are at-risk for being institutionalized within
the next 30 days.
b) Right to Community-Based Services. In 1999, the United
States Supreme Court ruled in Olmstead vs. L.C., the
pioneering court case related to community-based programs.
The plaintiffs were patients with mental illness and
developmental disabilities who were voluntarily admitted to
the psychiatric unit in the state-run Georgia Regional
Hospital. The patients remained at the institution for
several years following their initial treatment, despite the
suggestion of mental health professionals that each was ready
to move to a community-based program. The patients filed
suit under the Americans with Disabilities Act (ADA) for
release from the hospital. The Supreme Court ruled that
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unjustified segregation of persons with disabilities
constitutes discrimination in violation of Title II of the
ADA. The Court held that public entities must provide
community-based services to persons with disabilities when:
i) such services are appropriate; ii) the affected persons do
not oppose community-based treatment; and, iii)
community-based services can be reasonably accommodated,
taking into account the resources available to the public
entity and the needs of others who are receiving disability
services from the entity.
c) Need for additional spots. The current NH/AF Waiver has
an enrollment cap of 3,792 persons in 2015 and 3,964 in 2016.
The current Waiver term is set to expire on December 31,
2016. According to a 2014 report by AARP, the Commonwealth
Fund and the SCAN Foundation, California ranks ninth in the
country in terms of providing high quality long-term services
and supports (LTSS) for older adults, people with physical
abilities and family caregivers.
d) Legislative Reports. In January 2015, the California
Senate Select Committee on Aging and Long-Term Care released
a report titled "A Shattered System: Reforming Long-Term Care
in California." The report highlighted the committee's
recommendations on implementing a comprehensive, effective
long-term care system within California. Among the
recommendations, the report calls for a renewed focus on the
transitional care from nursing homes to community and
home-based settings. The report states that although
individuals overwhelming prefer to receive services in the
community rather than in an institution, limited resources,
coordination, availability, and access often impose barriers
to these efforts.
e) Current Cost Structure of NH/AF Waiver. A state may limit
participation in a waiver based on the expected cost of the
home and community-based services that would be furnished to
a person. A waiver's design may include reasonable methods
to control overall spending, including the specification of
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an individual cost limit. The individual cost limit does not
specify an amount of waiver services to which an individual
is entitled and must be applied uniformly to all potential
waiver entrants. While federal guidance allows these limits
to be managed in the aggregate to ensure cost-neutrality or
achieve a targeted level of expenditures per waiver
participant, entrance determinations must be made on an
individual basis.
States currently have four choices regarding the individual
cost limit: i) no cost limit; ii) cost limit in excess of
institutional costs; iii) institutional cost limits; and, iv)
cost limits lower than institutional services. California
currently elects to have a cost limit lower than
institutional level, in which the state refuses provide a
waiver slot to any otherwise qualified individual when the
state reasonably expects that the cost of home and
community-based services furnished to that individual would
exceed an amount specified by the state that is less than the
cost of a level of care specified for the waiver. Federal
guidelines state that the selection of this limit generally
is only appropriate in the case of waivers that target
individuals who can be expected to have available services
and supports from other sources (e.g., family caregivers or
other public programs) that, in combination with waiver
services, will be sufficient to assure their health and
welfare.
3)SUPPORT. Disability Rights California, the sponsor of the bill,
states the current NH/AF waiver offers much less money for
home-based care than the state pays for care in comparable
institutions. The sponsor asserts this state policy allows an
individual to receive care in a more expensive and unneeded
institution than to receive services at home and is the
definition of "institutional bias." The sponsor points to the
individual cost limit structure, outdated cost limits, a lengthy
waiver approval process, and a risk of discontinued services for
individuals who qualify for Early and Periodic Screening,
Diagnostic, and Treatment services, as evidence for the need for
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this bill. The sponsor also urges the need for additional
waiver spots, evidenced by the data from a 2014 AARP report that
shows if California was performing as well as the top state in
the country in providing LTSS to residents, an additional 10,727
nursing home residents would be receiving LTSS in a community
setting, and 11,785 additional new Medi-Cal LTSS beneficiaries
would first receive services within the community.
Supporters assert the bill provides people with disabilities,
including young people and seniors, more opportunities to
receive long-term services and supports in their own homes and
communities rather than forcing them into less desirable,
unneeded and more expensive institutional settings. They also
state the bill will reflect in state budget savings, as
home-based services are less expensive than comparable
institutional services.
4)PREVIOUS LEGISLATION.
a) AB 1477 (Budget Committee) of 2014 in part required the
DHCS to work with and assist recipients under the NF/AH
Waiver, who are at or near their individual cost cap, to
avoid a reduction in services. This bill died on third
reading file.
b) SB 873, Chapter 685, Statues of 2014, requires DHCS to
work with and assist recipients on the NF/AH Waiver who are
at or near the individual cost cap to avoid a reduction in an
individual's services that could result because of increased
overtime pay for providers.
5)DOUBLE REFERRED. This bill is double referred, upon passage of
this Committee it will be referred to the Assembly Committee on
Aging and Long-Term Care.
6)POLICY CONSIDERATION. This bill requires DHCS to adjust the
cost limitation category of the NH/AF Waiver. Typically,
federal Medicaid waivers are based on complex funding formulas
and federal requirements. Waivers are required to be cost
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neutral for the federal government; amending the waiver will
require a showing of cost neutrality and the willingness of CMS
to consider and approve the amendment. This bill would require
DHCS to re-negotiate the terms of the waiver. It is not clear
whether the state could secure a revised waiver based on the
adjusted cost structure.
7)SUGGESTED AMENDMENTS. The committee suggests the following
clarifying amendments to be considered in future committees:
a) The bill requires DHCS, in determining the need for
additional waiver spots, to consider the needs identified by
programs that assist people to leave nursing homes. The
current language is broad and it is unclear how these
programs are different from stakeholder groups which, under
the bill, DHCS must also consult with in determining the
number of waiver spots. The committee suggests the bill be
amended to specify which local and/or state programs must be
considered by DHCS when considering the number of Waiver
slots.
b) This bill requires DHCS to expedite the processing of
waiver applications of those patients who are at imminent
risk of being placed in a hospital or nursing facility. The
language does not specify which entity has authority of
determining whether or not a patient is of imminent risk. It
also does not discuss what factors are to be considered in
that determination. The committee suggests the bill be
amended to clarify which entity has the authority to decide
if an individual is at imminent risk, and what factors must
be considered by that entity in making that determination.
c) This bill currently requires DHCS to implement certain
provisions by July 1, 2016, which is six months after the
bill would become law. However, it is unknown when CMS will
approve the requested for an amended waiver. The committee
suggests adjusting the bill language to specify the time
range by which the provisions must be implemented upon
approval of the waiver by CMS, rather than specifying a date
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in statute.
REGISTERED SUPPORT / OPPOSITION:
Support
Disability Rights California (sponsor)
California Association of Public Authorities for IHSS
Independent Living Resource Center, Inc.
United Domestic Workers of America
Opposition
None on file.
Analysis Prepared by:An-Chi Tsou / HEALTH / (916) 319-2097
AB 1518
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