BILL ANALYSIS                                                                                                                                                                                                    

                             Senator Ricardo Lara, Chair
                            2015 - 2016  Regular  Session

          AB 2207 (Wood) - Medi-Cal:  dental program
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          |Version: June 28, 2016          |Policy Vote: HEALTH 9 - 0       |
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          |Urgency: No                     |Mandate: No                     |
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          |Hearing Date: August 1, 2016    |Consultant: Brendan McCarthy    |
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          This bill meets the criteria for referral to the Suspense File.

          Summary:  AB 2207 would enact an number of changes to the  
          operation of the Denti-Cal program, relating to provider  
          enrollment, program monitoring, and reporting.

           One-time costs of $370,000 and ongoing costs of $340,000 per  
            year for additional collection, analysis, and reporting of new  
            performance measures by the Department of Health Care Services  
            (General Fund and federal funds).

           Unknown costs to make administrative changes to the system for  
            enrolling Denti-Cal providers (General Fund and federal  
            funds). The bill requires the Department to make several  
            changes to the processes and systems for enrolling dental  
            providers into the program, such as requiring the use of a  
            dental-specific enrollment form, pursuing an automatic  
            enrollment process for commercially-credentialed providers,  
            and improving the system for maintaining the provider network.  
            The Department has already began some of these processes, such  


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            as simplifying the paper enrollment application. Other  
            activities, such as automatically enrolling  
            commercially-credentialed providers have not begun and will  
            impose unknown administrative costs to implement. On the other  
            hand, improvements to the system for provider enrollment may  
            reduce future administrative workload to process enrollment  
            applications, which are currently very labor intensive to the  
            Department and its fiscal intermediary.

           Unknown costs to provide additional Denti-Cal services, to the  
            extent that the changes in the bill improve participation  
            rates by dental providers, increasing the utilization of  
            Denti-Cal services (General Fund and federal funds).  
            Currently, the state spends about $1.2 billion per year on  
            Denti-Cal for adults and children. Estimates of the  
            utilization rates, but are all generally low. There are strong  
            indications that low reimbursement rates and cumbersome  
            administrative requirements on providers result in low  
            participation rates by providers. To the extent that the  
            administrative changes in the bill improve provider  
            participation, there could be increased utilization. For  
            example, for every 5% increase in annual utilization by  
            children, the cost would be about $35 million per year.

           Unknown potential cost-savings due to increased use of  
            preventative dental services (General Fund and federal funds).  
            Regular dental care, particularly for children, is likely to  
            prevent dental conditions, such as cavities, from becoming  
            more serious health problems that require more costly  
            interventions later. To the extent that the bill results in  
            increased utilization of preventative dental services in  
            Denti-Cal, there are likely to be reduced costs for more  
            serious dental services. Whether those avoided costs are  
            greater than the cost of providing greater access to  
            preventative services is unknown.

          Background:  Under state and federal law, the Department of Health Care  
          Services operates the Medi-Cal program, which provides health  
          care coverage to low income individuals, families, and children.  
          Medi-Cal provides coverage to childless adults and parents with  
          household incomes up to 138% of the federal poverty level and to  
          children with household incomes up to 266% of the federal  
          poverty level. The federal government provides matching funds  


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          that vary from 50% to 90% of expenditures depending on the  
          category of beneficiary. 
          Medi-Cal coverage includes full dental coverage for children and  
          limited dental coverage for adults. (Adult coverage had been  
          eliminated from the program in 2009 but was partially restored  
          in 2013.) Dental services in Medi-Cal, referred to as Denti-Cal,  
          are provided through the fee-for-service system in most of the  
          state. Denti-Cal services are provided through dental managed  
          care in Sacramento and Los Angeles Counties (enrollment in  
          dental managed care is mandatory in Sacramento but optional in  
          Los Angeles).

          Recent analyses of the Denti-Cal program by the Bureau of State  
          Audits and the Little Hoover Commission have found low levels of  
          utilization (particularly by children), low provider  
          reimbursement rates, and a complicated system for providers to  
          navigate. Estimates of the annual usage vary. According to the  
          Little Hoover Commission, in 2014 only 26% of eligible adults  
          saw a dentist. According to the Department, 52% of eligible  
          children saw a dentist in 2015. According to the federal  
          government, 38% of eligible children saw a dentist in 2014.

          Proposed Law:  
            AB 2207 would enact an number of changes to the operation of  
          the Denti-Cal program, relating to provider enrollment, program  
          monitoring, and reporting.
          Specific provisions of the bill would:
           Require additional reporting of Denti-Cal performance  
            measures, particularly reporting of provider-specific  
            utilization measures;
           Require quarterly posting of Denti-Cal performance measures  
            (rather than the current annual posting);
           Require expedited enrollment of Denti-Cal providers, for  
            example by requiring a dental-specific enrollment form,  
            pursuing automatic enrollment for providers who are already  
            commercially credentialed with a Department of Health Care  
            Services contractor (e.g. the state's fiscal intermediary),  
            and making other streamlining changes;
           Require the Department to disenroll a provider who has not  
            submitted a claim for more than one year, with specific  


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            notification requirements;
           Require additional monitoring of access and utilization of  
            Denti-Cal services;
           Require the Department to assess opportunities for payment  
            reform proposals;
           Require the Department to consult with stakeholders on ways to  
            improve the program, including several specific issues such as  
            utilization controls and outreach activities;
           Require Medi-Cal managed care plans to provide dental  
            screenings, make referrals for necessary dental care, and  
            assist with referrals;
           Authorize the Department to initially implement the  
            requirements of the bill without adopting regulations, but  
            require implementing regulations to be adopted by December 31,  
           Make implementation of the changes to the provider enrollment  
            process and other actions to improve access to Denti-Cal  
            contingent on federal approvals and receiving federal matching  
           Codify reporting requirements related to the Dental  
            Transformation Initiative (a dental-specific program within  
            the state's new Medi-Cal 2020 waiver).

           SB 1098 (Canella) would establish a Denti-Cal Advisory Group  
            within the Department of Health Care Services to study and  
            oversee the policies and priorities of the Denti-Cal program.  
            That bill is pending in the Assembly.
           AB 1051 (Maienschein) would require the Department of Health  
            Care Services to increase certain Denti-Cal rates to those  
            paid under commercial dental coverage. That bill will be heard  
            in this committee.

          Comments:  The Department of Health Care Services has begun  
          several of the activities required in the bill, such as reforms  
          to the Denti-Cal provider enrollment system. The reporting  
          requirements relating to the Dental Transformation Initiative  
          are requirements of the Medi-Cal 2020 waiver and so would occur  
          with or without this bill.


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