BILL ANALYSIS                                                                                                                                                                                                    Ó



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          Date of Hearing:  April 19, 2016


                            ASSEMBLY COMMITTEE ON HEALTH


                                   Jim Wood, Chair


          AB 2821  
          (Chiu) - As Amended March 29, 2016


          SUBJECT:  Medi-Cal Housing Program.


          SUMMARY:  Requires the Department of Housing and Community  
          Development (HCD), in coordination with the Department of Health  
          Care Services (DHCS) to establish the Medi-Cal Housing Program  
          (MCHP).  Specifically, this bill:  


          1)Requires HCD, in coordination with DHCS, to do all of the  
            following:

             a)   On or before July 1, 2017, design and create the MCHP;

             b)   On or before July 1, 2017, draft guidelines for  
               stakeholder comment to fund grants to pay for long-term  
               housing costs under the MCHP;

             c)   On or before January 1, 2018, and every year thereafter,  
               subject to appropriation by the Legislature, award grants  
               to eligible counties and regions participating in a Whole  
               Person Care (WPC) pilot program;

             d)   Collect data midyear and annually from counties and  
               regions receiving grants awarded pursuant to this bill;  
               and, 








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             e)   By March 31, 2019, and every year thereafter in which  
               the MCHP receives funding, report data collected to the  
               Assembly Committee on Budget, the Senate Committee on  
               Budget and Fiscal Review, the Assembly Committee on Housing  
               and Community Development, and the Senate Committee on  
               Transportation and Housing.

          2)Makes a county or a region that includes more than one county  
            eligible for a MCHP grant if the county or region's lead  
            entity meets all of the following requirements:

             a)   One of the following descriptions:

               i)     Is a lead entity participating in a WPC pilot  
                 program under the Medi-Cal 2020 Waiver (Waiver);
               ii)    Is a lead entity that had previously participated in  
                 a WPC pilot program that has expired; or, 


               iii)   Is a county with Medi-Cal managed care plans  
                 participating in the Health Home Program and demonstrates  
                 collaboration, as specified.

             b)   Has formed collaborative relationships with at least one  
               health plan, county health and behavioral health agencies,  
               at least one housing authority, and established relevant  
               continuums of care, as described in the Waiver's Special  
               Terms and Conditions (STCs), along with nonprofit housing  
               and homeless service providers, to enable the county or  
               region to carry out the provisions of this program;

             c)   For residents participating in the MCHP, has identified  
               a source of funding for care management and other services  
               identified in the Centers for Medicare and Medicaid  
               Services Informational Bulletin regarding Housing-Related  
               Activities and Services for People with Disabilities,  
               issued June 2015, and identified in Waive STCs.  Requires  
               funding to include one or more of the following:








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               i)     County general funds;
               ii)    WPC pilot housing pool and care management programs;  
                 and/or, 


               iii)   The Health Home Program.

             d)   Has designated a process for administering grant funds  
               through agencies administering housing programs; and,

             e)   Agrees to collect and report data to HCD and DHCS, as  
               specified.

          3)Requires a county or region awarded grant funds under this  
            bill to form agreements with health plans to collect Medi-Cal  
            data regarding members' overall health costs.

          4)Requires a county or region awarded grant funds to, at annual  
            and midyear intervals, report all of the following data to HCD  
            and DHCS:

             a)   A comparison of health care costs of residents receiving  
               long-term rental assistance under the MCHP to health care  
               costs of homeless residents not receiving long-term rental  
               assistance;

             b)   The number of participants and the type of interventions  
               offered through grant funds; and,

             c)   The number of participants receiving long-term rental  
               assistance living in supportive housing or other housing  
               that does not limit length of stay.

          5)Requires a county or region to use grants awards for one or  
            more of the following, which may be administered through a  
            housing pool, as defined in the Waiver STCs:

             a)   Long-term rental assistance for periods up to five  








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               years, as determined by the eligible county; 

             b)   Interim housing; and,

             c)   A county's administrative costs for up to 5% of the  
               total grant awarded.

          6)Makes a county resident eligible to receive assistance  
            pursuant to a grant awarded under the MCHP if he or she meets  
            all of the following requirements:

             a)   Is homeless upon initial eligibility;

             b)   Is a Medi-Cal beneficiary; and, 

             c)   Is eligible for the services program identified by  
               participating counties or regions.

          7)Subjects the MCHP to an initial appropriation by the  
            Legislature.  After the initial appropriation, the funding of  
            grants under the MCHP is subject to annual appropriations by  
            the Legislature based on decreased costs of care, as reported  
            by participating counties, of moving eligible participants  
            into supportive housing.

          8)Requires HCD to use no more than 5% of the funds appropriated  
            for the MCHP for purposes of administering the program.

          9)Finds and declares the importance of addressing chronic  
            homelessness and costs incurred by the Medi-Cal program in  
            addressing the needs of people who cycle from homelessness,  
            emergency departments (EDs), inpatient care, and nursing home  
            stays.

          10)Defines various terms including the following:

             a)   "Interim housing" as a safe place for a participant to  
               live temporarily while the participant is waiting to move  
               into an apartment affordable to the participant.   Interim  








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               housing may include recuperative or respite care and shall  
               not be funded for longer that a period of nine months;

             b)   "Long-term rental assistance" as a rental subsidy  
               provided to a housing provider to assist a tenant to pay  
               the difference between 30% of the tenant's income and the  
               costs of operating the assisted apartment.

          EXISTING LAW:  


          1)Establishes Medi-Cal, administered by DHCS, to provide  
            comprehensive health care services and long-term care to  
            pregnant women, children, and people who are aged, blind, and  
            disabled.


          2)Establishes HCD, to among other functions, implement policies  
            and programs to preserve and expand affordable housing in  
            California.


          3)Defines "supportive housing" as housing with no limit on  
            length of stay, that is occupied by a target population, as  
            defined, and that is linked to onsite or offsite services that  
            assist the supportive housing resident in retaining the  
            housing, improving his or her health status, and maximizing  
            his or her ability to live and, when possible, work in the  
            community.


          FISCAL EFFECT:  This bill has not yet been analyzed by a fiscal  
          committee.


          COMMENTS:  


          1)PURPOSE OF THIS BILL.  According to the author, California is  








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            home to 20% of the country's homeless population.   
            Homelessness often creates an institutional circuit, where  
            those experiencing it long enough cycle through living on the  
            streets, ED visits, inpatient admissions, incarceration, and  
            often nursing home stays. In addition to the moral cost to  
            society, this circuit is expensive to our public systems:   
            homeless individuals cost our public systems an average of  
            $2,897 per month, two-thirds of that incurred through the  
            health system.  This bill attempts to coordinate delivery of  
            services between the health and housing systems to further our  
            goal of eliminating homelessness. 


          2)BACKGROUND.  According to the Substance Abuse and Mental  
            Health Services Administration, stable housing provides the  
            foundation upon which people build their lives. Without a  
            safe, affordable place to live, it is almost impossible to  
            achieve good health or to achieve one's full potential.  But,  
            according to the Department of Housing and Urban Development  
            (HUD), on a single night in 2014, more than 578,000 people,  
            including 136,000 children, experienced homelessness.  Of  
            those people, more than 177,000 were unsheltered.  While the  
            number of people experiencing homelessness has declined since  
            2007, much work remains to be done to reach the goal of ending  
            homelessness in the United States.  According to HUD's 2013  
            Annual Homelessness Assessment Report, of those who experience  
            homelessness, approximately 257,300 people have a severe  
            mental illness or a chronic substance use disorder.


             a)   Homelessness and Health Care.  According to the National  
               Coalition for the Homeless (Coalition), homelessness and  
               health care are intimately interwoven.  Inadequate health  
               insurance is itself a cause for homelessness.  Many people  
               without health insurance have low incomes and do not have  
               the resources to pay for health services on their own.  A  
               serious injury or illness in the family could result in  
               insurmountable expenses for hospitalizations, tests, and  
               treatment.  For many, this forces a choice between hospital  








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               bills or rent.  Homeless people are three to six times more  
               likely to become ill than housed people.  Homelessness  
               precludes good nutrition, good personal hygiene, and basic  
               first aid, adding to the complex health needs of homeless  
               people.  Additionally, conditions which require regular,  
               uninterrupted treatment, such as tuberculosis and HIV/AIDS,  
               are extremely difficult to treat or control among those  
               without adequate housing.  Diseases that are common among  
               the homeless population include heart disease, cancer,  
               liver disease, kidney disease, skin infections, HIV/AIDS,  
               pneumonia, and tuberculosis.  People who live on the  
               streets or spend most of their time outside are at high  
               risk for frostbite, immersion foot, and hypothermia,  
               especially during the winter or rainy periods.  Although  
               not many homeless deaths are specifically attributed to  
               exposure-related causes, the risk of death from other  
               causes is increased eightfold in people who have  
               experienced those conditions in the past 



             The Coalition further notes that many homeless people who are  
               ill and need treatment do not ever receive medical care.   
               Barriers to health care include lack of knowledge about  
               where to get treated, lack of access to transportation, and  
               lack of identification.  Psychological barriers also exist,  
               such as embarrassment, nervousness about filling out the  
               forms and answering questions properly, and  
               self-consciousness about appearance and hygiene when living  
               on the streets.  The most common obstacle to health care is  
               the cost, without health coverage, many homeless people  
               simply cannot pay for health care services.  As a result,  
               many homeless people utilize hospital EDs as their primary  
               source of health care.  Not only is this the least  
               effective form of care for them, since it provides little  
               continuity, it is also very expensive for hospitals and the  
               government.  As a result of these factors, homeless people  
               are three to four times more likely to die than the general  
               population.  This increased risk is especially significant  








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               in people between the ages of 18 and 54.  Although women  
               normally have higher life expectancies than men, even in  
               impoverished areas, homeless men and women have similar  
               risks of premature mortality.  In fact, young homeless  
               women are ip to 31 times as likely to die early as housed  
               young women.  The average life expectancy in the homeless  
               population is estimated between 42 and 52 years, compared  
               to 78 years in the general population.
             b)   Waiver.  On December 30, 2015, DHCS received federal  
               approval from the Centers for Medicare and Medicaid  
               Services (CMS) for a renewal of its Medicaid Section 1115  
               Waiver.  The new waiver "Waiver 2020" builds upon the  
               Bridge to Reform Waiver (BTR) that was approved in 2010.   
               In addition to preserving many of the existing elements of  
               the BTR, the new Waiver includes several new, ambitious  
               initiatives aimed at continuing the delivery system  
               improvements that began five years ago.  The Waiver  
               provides opportunities for innovation through WPC pilots,  
               expanded care opportunities for California's remaining  
               uninsured and a Dental Transformation Initiative.  The new  
               Waiver will provide California with at least $6.2 billion  
               in ongoing federal funding over the next five years.  The  
               Waiver represents a shared commitment between California  
               and CMS to provide 13 million Medi-Cal beneficiaries with  
               efficient, high quality care that will ultimately improve  
               health outcomes and reduce costs.


             c)   WPC Pilot.  One of the most innovative aspects of the  
               Waiver is a new opportunity for counties to leverage  
               resources more effectively by coordinating physician  
               health, behavioral health, and social services in a  
               patient-centered manner with the goal of improving the  
               health and well-being of beneficiaries.  The new WPC pilots  
               will enable counties and their partners to target these  
               high users, share data between systems, coordinate care in  
               real time, and evaluate progress in improving individual  
               and population health.  The WPC pilots provide extensive  
               local flexibility, enabling a county, city and county, a  








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               health or hospital authority, or a consortium of entities  
               to design approaches that address the specific needs of  
               their most vulnerable Medi-Cal beneficiaries.  While there  
               must be one "Lead Entity," the WPC pilot applications will  
               identify the comprehensive set of participating entities  
               that will work together to provide beneficiaries with more  
               integrated, person-centered care.  The WPC pilots also  
               permit applicants to choose target populations, identify  
               strategies for meeting the needs of the populations, and  
               develop payment methodologies.  



             The formal allocation of WPC funding is under development,  
               but in order to participate, WPCs will need to meet the  
               following conditions:
               i)     The WPC must have an established infrastructure to  
                 integrate services among local entities that serve the  
                 target population;


               ii)    Services provided must not be otherwise covered or  
                 directly reimbursed by Medi-Cal; and,


               iii)   The WPC must employ strategies to improve  
                 integration, reduce unnecessary utilization of health  
                 care services, and improve health outcomes.


               One of the likely target populations for the WPC pilots is  
               individuals at risk of or experiencing homelessness who  
               have a demonstrated medical need for housing or supportive  
               services. Permissible housing interventions included in the  
               WPC pilot are:


               i)     Tenancy-based care management services.  Services  
                 such as individual housing transition services,  








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                 individual tenancy sustaining services, and  
                 housing-related collaborative activities designed to  
                 assist the target population in locating and maintaining  
                 medically necessary housing.


               ii)    County housing pools.  These pools, which may  
                 include contributions from county entities, will directly  
                 support medically necessary housing services with the  
                 goal of improving access to housing and reducing churn in  
                 Medi-Cal.  Services can include respite care or interim  
                 housing arrangements and services to enable timely  
                 discharge from inpatient stays or nursing facilities  
                 while permanent housing is being arranged. While federal  
                 funds cannot be used to support long-term housing  
                 arrangements, state or local contributions can be used  
                 for rental subsidies.


          3)SUPPORT.  Western Center on Law and Poverty states that  
            Californians experiencing homelessness incur disproportionate  
            costs to local and state programs, many of which are Medi-Cal  
            costs.  Despite these high health costs, people experiencing  
            homelessness have poor health outcomes, and are at significant  
            risk for early mortality.  This bill is a one-time investment  
            that would decrease Medi-Cal costs resulting from dramatic  
            improvements in clinical outcomes.  



          The League of California Cities states that providing  
            wrap-around services for homeless men, women, and children has  
            not only proven to be the most effective way to end chronic  
            homelessness but is a smart use of tax dollars.  
          4)RELATED LEGISLATION.  AB 1568 (Bonta and Atkins) and SB 815  
            (Hernandez and De Leon) are identical bills dealing with the  
            implementation of the Waiver.  AB 1568 is pending in Assembly  
            Health Committee and SB 815 is pending in Senate Health  
            Committee.








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          5)TECHNICAL AMENDMENT.  Since the Assembly and Senate Health  
            Committees have jurisdiction over the Medi-Cal program, the  
            Committee recommends that the report relating to the MCHP  
            should also be submitted to these committees.


          REGISTERED SUPPORT / OPPOSITION:




          Support


          Western Center on Law and Poverty


          League of California Cities




          Opposition


          None on file.




          Analysis Prepared by:Rosielyn Pulmano / HEALTH / (916) 319-2097














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