BILL ANALYSIS                                                                                                                                                                                                    



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          Date of Hearing:  April 19, 2016


                            ASSEMBLY COMMITTEE ON HEALTH


                                   Jim Wood, Chair


          AB 2424  
          (Gomez) - As Amended April 6, 2016


          SUBJECT:  Community-based Health Improvement and Innovation  
          Fund.


          SUMMARY:  Creates a Community-based Health Improvement and  
          Innovation (CHII) Fund for certain purposes, including funding  
          for health inequity and disparities in the rates and outcomes of  
          priority chronic health conditions.    Specifically, this bill:   



          1)Creates in the State Treasury the CHII Fund that consists of  
            any revenues deposited therein, including any fine or penalty  
            revenue allocated to the fund, any revenue from appropriations  
            specifically designated to be credited to the CHII Fund, any  
            funds from public or private gifts, grants, or donations, any  
            interest earned on that revenue, and any funds provided by any  
            other source.  States that a target level of annual statewide  
            investment from the fund is to be established as a set dollar  
            amount per capita.


          2)Requires CHII Fund to be available, upon appropriation by the  
            Legislature, for any of the following purposes:










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             a)   Reducing health inequity and disparities in the rates  
               and outcomes of priority chronic health conditions;


             b)   Preventing the onset of priority chronic health  
               conditions using community-based strategies in communities  
               statewide and with particular focus on health equity  
               priority populations; 


             c)   Strengthening local and regional collaborations between  
               local public health jurisdictions and health care  
               providers, and across government agencies and community  
               partners to create healthier communities, as specified;


             d)   Contributing to a stronger evidence base of effective  
               community-based prevention strategies for priority chronic  
               health conditions; and,


             e)   Evaluating effectiveness and cost-effectiveness of  
               innovative community-based prevention strategies for  
               priority chronic health conditions, as specified.  


          3)Requires the CHII Fund to be used to address social,  
            environmental, and behavioral determinants of chronic disease  
            and injury at any phase of life cycle, including, but not  
            limited to all of the following:


             a)   Promotion of healthy diets and food environments;


             b)   Promotion of physical activity and of a safe, physical  
               activity-promoting environment; and,










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             c)   Prevention of unintentional and intentional injury.   


          4)Emphasizes policy, systems, and environmental changes  
            approaches, although the CHII Fund can support implementation  
            of community-based programs and prohibits the CHII Fund to be  
            used for clinical services.  


          5)Requires deposited revenues that are not expended at the end  
            of a fiscal year to remain in the CHII Fund and not revert to  
            the General Fund.  


          6)Requires the Department of Public Health (DPH) to allocate an  
            amount not greater than 20% of the annual appropriation from  
            the CHII Fund for any of the following activities:


             a)   Mandatory activities:


               i)     Statewide media and communication campaigns:  9% of  
                 funds;


               ii)    Evaluation of program activities:  At least 5% of  
                 funds;


               iii)   Other activities:  No more than 6% of those funds,  
                 including;


                  (1)       Mandatory activities like the overall program  
                    implementation and oversight; review and approval of  
                    local health improvement plans; and granting of and  
                    monitoring the implementation of local health  
                    jurisdictions and competitive grant awards; and,








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                  (2)       Discretionary activities as may be appropriate  
                    to support community-based prevention of priority  
                    chronic health conditions, as specified, including but  
                    not limited to any of the following:


                    (a)         Research, development, dissemination of  
                      best practices, as specified;


                    (b)         Development of infrastructure, as  
                      specified;


                    (c)         Coordination of local efforts; and,


                    (d)         Development and promotion of statewide  
                      initiatives.


             b)   Requires DPH to award at least 80 percent of the CHII  
               Fund made available in the annual appropriation to eligible  
               applicants to be used consistent with the purposes  
               identified in the CHII Fund and provides for distribution  
               and award according to the following criteria:


               i)     At least 50% of those funds awarded to local health  
                 jurisdictions and allocated on a formula basis to local  
                 health jurisdictions, or their nonprofit designee, with  
                 approved applications for three-year funding cycles; and,


               ii)    Each local health jurisdiction will submit an  
                 application for a three-year funding cycle, reviewed and  
                 approved by DPH, which includes all of the following:








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                  (1)       Detailed, assessment of community health  
                    needs, as specified; 


                  (2)       Health improvement and evaluation plan, as  
                    specified;


                  (3)       Level of local funds, including in-kind  
                    resources, for community-based prevention activities,  
                    as specified; and,


                  (4)       Documentation of the existence and activities  
                    of a community health partnership, as specified.  


                 iii)     Each local health jurisdiction with an approved  
                   application shall receive a base award of $250,000 for  
                   a three-year funding cycle.  The balance of funds will  
                   be awarded to local health jurisdictions proportional  
                   to the number of residents living below the federal  
                   poverty level;


                 iv)      Health improvement and evaluation plans will  
                   emphasize sustainable policy, systems, and  
                   environmental change approaches to creating healthier  
                   communities;


                 v)       Local health jurisdictions may submit combined  
                   regional applications;


                 vi)      No single recipient will receive more than 30  
                   percent of the funding allocated to local health  








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                   jurisdictions on a formula basis;


                 vii)     Recipients will maintain the level of local  
                   funds, including in-kind resources, for community-based  
                   prevention activities that were provided in the most  
                   recent completed fiscal year prior to July 2016.  CHII  
                   Funds will supplement and not supplant existing funding  
                   for community-based prevention activities, as  
                   specified; and,


                 viii)    Local health jurisdiction investments will  
                   prioritize communities in the third and fourth  
                   quartiles of the California Health Disadvantage Index  
                   (CHDI) or other criteria of health equity priority  
                   populations as subsequently adopted by DPH. 


             c)   Requires DPH to allocate at least 30% for competitive  
               grants as follows:


               i)     To be awarded to local or regional level entities or  
                 statewide nonprofit organizations;


               ii)    Local or regional level entities include  
                 community-based organizations or local public agencies,  
                 in partnership with other entities, as specified;


               iii)   Each participating health care plan or hospital will  
                 identify monetary, in-kind, or both, contributions to  
                 projects;


               iv)    Local or regional projects will prioritize  
                 investments that serve communities in the third or fourth  








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                 quartiles of the CHDI or other criteria, as specified; 


               v)     At least 10% of the funds awarded will be used for  
                 statewide nonprofit organizations; and,


               vi)    Organizations receiving competitive grants will  
                 coordinate efforts with any local health jurisdictions  
                 where they are carrying out activities.


             d)   Provides that competitive grants will identify projects  
               as either evidence-based or an innovative project.   
               Requires at least 10% of the funding to be set aside for  
               innovative projects, as specified, and applications for  
               innovative projects to include a rationale for the defined  
               approach and any evidence that suggests effectiveness, as  
               well as a plan and resource allocation for the evaluation.   
               Provides that competitive grants may be used by  
               organization for policy systems or environmental change  
               efforts, direct program delivery, or for technical  
               assistance to other grantees.  


          7)Creates an advisory committee, with members serving no more  
            than four years, to provide expert input and offer guidance to  
            DPH on the development, implementation, and evaluation of the  
            CHII Fund and will include, at a minimum, experts on priority  
            chronic health conditions, effective nonclinical prevention  
            strategies for chronic disease prevention, and the unique  
            needs of health equity priority populations.  Requires  
            representatives from the State Department of Health Care  
            Services, the Health in All Policies Task Force, the  
            California Health and Human Services Agency, the California  
            Conference of Local Health Officers, and the California Public  
            Employees' Retirement System.  










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          8)Requires DPH to develop a robust evaluation framework for all  
            activities and states that DPH may define state priorities as  
            specified, and may narrow the list of priority chronic health  
            conditions if necessary to ensure an effective program.  


          9)Requires the advisory committee to produce a comprehensive  
            master plan for advancing chronic disease and injury  
            prevention through the state, based on the results of programs  
            and any other proven methodologies available to the advisory  
            committee.  Provides that the master plan include  
            recommendations of implementation strategies, as specified;  
            specific goals for reduction of the burden of preventable  
            chronic conditions and injuries by 2030; administrative  
            arrangements; funding priorities; integration and coordination  
            of approaches by DPH, the University of California, the Health  
            in All Policies Task Force, and their support systems; and,  
            progress reports relating to each health equity priority  
            population.  Requires the advisory committee to submit the  
            master plan to the Legislature triennially.  


          10)Defines various terms including health equity priority  
            population and priority chronic health conditions.


          11)Finds and declares the importance of treating chronic  
            diseases and identifies the health inequities in this State.  


          EXISTING LAW establishes DPH, within the California Health and  
          Human Services Agency, vested with certain duties, powers,  
          functions, jurisdiction, and responsibilities over specified  
          public health programs.  


          FISCAL EFFECT:  This bill has yet to be analyzed by a fiscal  
          committee.  









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          COMMENTS:  


          1)PURPOSE OF THIS BILL.  The author states that with this bill  
            and with proper management, innovative investment strategies,  
            and equitable distribution and implementation plans, the CHII  
            Fund would help the State achieve greater health equity and  
            advance the "Triple Aim" of health improvement:  a) better  
            care; b) better health; and, c) lower costs.  According to the  
            author, a $10 per capita investment over 3 years (for  
            prevention of disease which accounts for 80% of health care  
            costs) is actually fairly modest for a statewide program with  
            these goals.  For comparison, Massachusetts has invested a $60  
            million one-time in a similar fund, which is similar in scale  
            based on their population. The state spends over $450 per  
            capita from the General Fund just on Medi-Cal every year-- and  
            much more when accounting for California Public Employees'  
            Retirement System employees and retirees, as well as  
            correctional health.  

            According to the author, DPH received a grant from the Centers  
            for Disease Control (CDC) and Prevention for $3.8 million to  
            promote healthy behaviors and reduce diabetes.  DPH's  
            Nutrition Education and Obesity Prevention Branch (NEOPB),  
            which addresses California's obesity epidemic by focusing on  
            healthy behavior changes in at-risk, low-income communities,  
            has major restrictions on the use of funds, and will face a  
            30% reduction in federal funds by 2018.  Funding from  
            Proposition 99 for tobacco control and First 5 California has  
            also declined due to successful tobacco control efforts.


          2)BACKGROUND.  As part of the Patient Protection and Affordable  
            Care Act (ACA) of 2010, the Prevention and Public Health  
            Investment Fund (Prevention Fund) was created to provide  
            communities around the country with more than $15 billion over  
            the next 10 years to invest in effective, proven prevention  
            efforts, like childhood obesity and tobacco cessation.  The  








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            Prevention Fund, in recent years, has suffered legislative  
            reduction and elimination of major programs.  

          In 2012, the Assembly and Senate Committees on Health conducted  
            a joint hearing with the goal of highlighting the health  
            benefits and cost savings associated with investing in  
            community-wide health promotion and disease prevention.  The  
            hearing was also meant to highlight new developments with  
            federal funding for health prevention that California received  
            as a result of the ACA, as well as new findings about voter  
            options on prevention.  The hearing also highlighted  
            prevention activities currently underway at the time across  
            the state to implement successful strategies aimed at reducing  
            health care costs and promoting health and wellness.  

          In 2014, the Assembly Committee on Health held an Information  
            Hearing, entitled Supporting Public Health in California:  The  
            Critical Rose of the State and Local Departments in Disease  
            Surveillance and Control.  The background included information  
            of the following:

             a)   Department of Public Health.  The mission of DPH is to  
               optimize the health and well-being of Californians,  
               primarily through population-based programs, strategies,  
               and initiatives.  DPH is broadly organized into Center for  
               Chronic Disease Prevention and Health Promotion (CCDP&HP),  
               Center for Environmental Health, Center for Family Health,  
               Center for Health Care Quality, and Center for Infectious  
               Diseases (CID).  CCDP&HP is DPH's lead on climate change  
               and on Health in All Policies. The State of California  
               created the Health in All Policies Task Force in 2010.  The  
               Task Force was charged with identifying priority programs,  
               policies, and strategies to improve the health of  
               Californians while advancing the goals of improving air and  
               water quality, protecting natural resources and  
               agricultural lands, increasing the availability of  
               affordable housing, improving infrastructure systems,  
               promoting public health, planning sustainable communities,  
               and meeting climate change goals.  CID protects  








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               Californians from the threat of preventable infectious  
               disease and assists individuals suffering from infectious  
               disease by securing prompt and appropriate access to health  
               care, medications, and associated support services.  CID  
               activities are a particular focus of this hearing,  
               specifically, the responsibility to help investigate and  
               diagnose infectious diseases of public health significance,  
               such as the flu.

             b)   Local Health Departments.  There are 61 local health  
               jurisdictions in California representing the 58 counties  
               and three cities: Berkeley, Long Beach, and Pasadena.   
               Public health officers have broad far-reaching authority  
               and responsibility under the law.  For example, public  
               health officers have the authority to order testing for  
               individuals or communities, quarantine individuals or  
               groups, and close beaches, restaurants, and other  
               facilities for public safety. Public health officers  
               receive reports from health providers and laboratories  
               concerning the incidence of more than 80 statutorily  
               reportable diseases including HIV/AIDs, tuberculosis, and  
               syphilis.  County health departments must submit monthly,  
               quarterly, or annual public health and program reports to  
               state agencies including DPH and the Emergency Medical  
               Services Authority.  County public health programs vary  
               substantially in their administrative structures, scope,  
               funding levels, staffing, and specific services and  
               programs offered.  Counties generally provide maternal and  
               child health care, child health and disability prevention,  
               tuberculosis control, and AIDS services.  Most counties  
               provide services related to sexually transmitted diseases,  
               smoking/tobacco cessation, childhood lead poisoning, and  
               immunizations.  Many counties have also developed their own  
               innovative programs. For example, the City of Berkeley  
               Public Health Department has modeled a Healthy Restaurant  
               Program on the Bay Area Green Business Project, which works  
               with businesses to implement sustainable practices and is  
               working with restaurants to help them to increase healthy  
               menu options.  The Community Health Department in Fresno  








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               County developed the Women's Health Education and Outreach  
               Program, which instituted Valley Women Care Clubs that  
               hosted monthly workshops for a total of eight months in a  
               chosen community.  The workshops focused on reducing  
               chronic disease risk through nutrition education, food  
               tastings and food preparation demonstrations, physical  
               activity sessions, and discussion on health perceptions and  
               practices.  Unfortunately due to a lack of funding this  
               program was later cut.



             c)   Public Health Spending in California.  At the State  
               level, the Governor's fiscal year (FY) 2014-15 Budget  
               provides $3 billion for the support of DPH programs and  
               services, a decrease of 11.4% from the previous year.  Of  
               the amount approved, 23% ($683.3 million) is for state  
               operations and 77% ($2.3 billion) is for local assistance.   
               There are two broad types of funding for public health in  
               California: categorical (consisting largely of federal  
               funding) and flexible (consisting of funding from public  
               health realignment and local sources).  Each local health  
               department is unique in its mixture of these funds.  A  
               consistent challenge is that flexible funds must be  
               prioritized to support mandated functions such as  
               communicable disease control, which receives little to no  
               categorical funding.  Consequently, flexible funding  
               available for other public health functions - such as  
               chronic disease prevention - is very limited.  When there  
               are reductions to flexible funding, there is a  
               disproportionate impact on mandated public health services.  
                Recent reductions to realignment may further reduce  
               funding for public health programs as they compete with  
               other county services, including clinical services for  
               indigent care, for fewer resources.  Public-private  
               partnerships have been developed to cover gaps in some  
               jurisdictions, but these funds are only temporary and are  
               usually initiative-specific.









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             d)   Health Equity.  According to the CDC, health equity is  
               achieved when every person has the opportunity to "attain  
               his or her full health potential" and no one is  
               "disadvantaged from achieving this potential because of  
               social position or other socially determined  
               circumstances."  Health inequities are reflected in  
               differences in length of life; quality of life; rates of  
               disease, disability, and death; severity of disease; and,  
               access to treatment.  Established in 2012, DPH's Office of  
               Health Equity (OHE) aims to reduce health and mental health  
               disparities in vulnerable communities.  OHE's work is  
               directed through their advisory committee and stakeholder  
               meeting process.  The OHE is required to consult with  
               community-based organizations and local governmental  
               agencies to ensure that community perspectives and input  
               are included in policies, strategic plans, recommendations,  
               and implementation activities. According to the U.S.  
               Department of Health and Human Services' report, "Healthy  
               People 2020: An Opportunity to Address the Societal  
               Determinants of Health in the United States," Americans do  
                                           not all have equal opportunities to make healthy choices.   
               A person's health and chances of becoming sick and dying  
               early are greatly influenced by powerful social factors  
               including education, income, nutrition, housing, and  
               neighborhoods.  The "Healthy People 2020" report indicates  
               that if we, as a state, develop strategies and programs to  
               help more Californians become physically active and adopt  
               good nutrition practices, and create social and physical  
               environments that promote good health for all, California  
               could substantially improve health and reduce health care  
               costs.



             e)   Concept Paper.  Additionally, a concept paper presented  
               this bill's proposal to develop a Health Improvement and  
               Innovation Fund, a funding and allocation structure to  








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               implement such an effort by providing resources for  
               community-based obesity and chronic disease prevention.  In  
               addition to providing background for the proposal, the  
               paper identified principles for an investment in improving  
               the health and well-being of Californians by preventing and  
               mitigating the impact of chronic disease, including but not  
               limited to, size and scope of the funding commitment; focus  
               on primary, community-based prevention; a mix of  
               evidence-based and innovative approaches; and, allocation  
               to improve health in a manner that enhances health equity,  
               ensures a base level of resources in local communities, and  
               encourages efficient use.  Finally, the paper also  
               identified expected outcomes in improving health and  
               reducing premature death and disability, catalyzing  
               partnerships, and building capacity for local health  
               agencies to reconfigure their activities to address the  
               most costly and burdensome health conditions.



             f)   Targeted federally funded programs.  The largest  
               prevention program DPH administers is the Nutrition  
               Education and Obesity Prevention program, which provides  
               health education interventions to recipients of  
               Supplemental Nutrition Assistance Program (SNAP) benefits.   
               This program receives funding through the U.S. Department  
               of Agriculture, and had a budget of around $90 million in  
               2014-15.  The mission of the program is to create  
               innovative partnerships that empower low-income  
               Californians to increase fruit and vegetable consumption,  
               physical activity, and food security with the goal of  
               preventing obesity and other diet related chronic diseases.  
                The Women, Infants, and Children program also offers  
               nutrition and breastfeeding education to program clients. 



             In federal fiscal year 2014, the CDC provided about $303  
               million to entities in California, including health  








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               departments, universities, and other public and private  
               agencies.  Of this total, about $62 million of this funding  
               statewide was allocated to different entities for chronic  
               disease and prevention activities.
             
          3)SUPPORT.  The Health Officers Association of California (HOAC)  
            states that with sound policies and adequate funding, most  
            chronic illnesses (arthritis, asthma, cardiovascular disease,  
            diabetes, cancer, and depression) can be prevented.  HOAC  
            contends that preventing chronic disease before it starts will  
            lead to decreased medical costs and improved productivity in  
            California.  


          4)RELATED LEGISLATION.  


             a)   AB 2782 (Bloom) of 2016 imposes a health promotion a fee  
               of $0.02 per fluid ounce on bottled sugar sweetened  
               beverages and concentrates and establishes the Health  
               California Fund (Fund) and allocates moneys from the Fund  
               to various state departments for purposes of reducing the  
               incidence and impact of diabetes, obesity, and dental  
               disease in California.  AB 2782 is pending in the Assembly  
               Health Committee.


             b)   AB 2430 (Gaines) of 2016 allows a taxpayer to designate  
               an amount in excess of personal income tax liability to be  
               deposited to the Type 1 Diabetes Research Fund, which the  
               bill would create. The bill would require moneys  
               transferred to the Type 1 Diabetes Research Fund, upon  
               appropriation by the Legislature, to be allocated to the  
               Franchise Tax Board and the Controller, as provided, and to  
               an authorized diabetes research organization, as defined,  
               for the purpose of type 1 diabetes research, as provided.   
               AB 2430 is pending in the Assembly Revenue and Taxation.  










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          5)PREVIOUS LEGISLATION.  


             a)   AB 572 (Gaines) of 2015 would have required DPH to  
               create a detailed diabetes action plan for the state, and  
               to report the results of the plan to the Legislature  
               biennially.  Requirements include the development of a  
               detailed budget blueprint identifying needs, costs, and  
               resources required to implement the plan and a proposed  
               budget for each action step, as well as policy  
               recommendations for the prevention and treatment of  
               diabetes.  AB 572 was held on the Suspense File in the  
               Senate Appropriations Committee. 



             b)   SCR 34 (Monning), Resolution Chapter 99, Statutes of  
               2015 proclaimed the month of September 2015, and each year  
               thereafter, as Childhood Obesity Awareness Month, and  
               expressed the Legislature's support of various programs  
               that work to reduce obesity among children.

             c)   SR 47 (Hall), Resolution Chapter 59, Statutes of 2015  
               proclaimed November 2016 as Diabetes Awareness Month, and  
               expressed the Senate's support of aggressive early  
               detection and treatment of diabetes.


          REGISTERED SUPPORT / OPPOSITION:




          Support


          California Immigrant Policy Center










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          California Pan-Ethnic Health Network


          Health Access California


          Health Officers Association of California 




          Opposition


          None on file.




          Analysis Prepared by:Kristene Mapile / HEALTH / (916) 319-2097