BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 586|
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THIRD READING
Bill No: SB 586
Author: Hernandez (D), et al.
Amended: 4/28/15
Vote: 21
SENATE HEALTH COMMITTEE: 8-0, 4/22/15
AYES: Hernandez, Nguyen, Mitchell, Monning, Nielsen, Pan,
Roth, Wolk
NO VOTE RECORDED: Hall
SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/28/15
AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen
SUBJECT: Children's services
SOURCE: California Children's Hospital Association
DIGEST: This bill requires the Department of Health Care
Services (DHCS) to enter into contracts with one or more Kids
Integrated Delivery System (KIDS) network authorized by this
bill to provide the full range of California Children's Services
Program (CCS) and Medi-Cal services to children eligible for the
CCS and Medi-Cal. This bill allows an individual on Medi-Cal who
is up to 26 years of age who was previously treated for a
CCS-eligible condition in the twelve months prior to his or her
21st birthday to remain in a KIDS network that accepts
individuals up to age 26 under its contract with DHCS. This bill
makes permanent, the CCS "carve out" of CCS services from
Medi-Cal managed care, except for existing counties and for the
newly created KIDS established by this bill.
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ANALYSIS:
Existing law:
1)Establishes the Medi-Cal Program, administered by DHCS, which
provides comprehensive health benefits to low-income children
up to 266 percent of the federal poverty level (FPL), parents
and adults up to 138 percent of the FPL, pregnant women, and
elderly, blind or disabled persons, who meet specified
eligibility criteria.
2)Establishes the CCS Program to provide specified medical care
and therapy services to children with eligible conditions.
3)Authorizes the state to contract for comprehensive managed
health care services for Medi-Cal beneficiaries, and to
require mandatory enrollment of Medi-Cal beneficiaries in
specified eligibility categories into managed care plans.
4)Prohibits CCS covered services from being be incorporated into
any Medi-Cal managed care contract entered into after August
1, 1994 until January 1, 2016, except for contracts entered
into for county organized health systems or Regional Health
Authority in the Counties of San Mateo, Santa Barbara, Solano,
Yolo, Marin, and Napa. This is known as the CCS "carve out."
5)Requires the Director of DHCS to establish, by January 1,
2012, organized health care delivery models for CCS-eligible
children. Requires these models to be chosen from the
following:
a) An enhanced primary care case management program;
b) A provider-based accountable care organization;
c) A specialty health care plan; or,
d) A Medi-Cal managed care plan that includes payment and
coverage for CCS-eligible conditions.
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This bill:
1) Permanently extends the CCS "carve out" from Medi-Cal
managed care except for either or both of the following:
a) Contracts entered into for county organized health
systems or Regional Health Authority in San Mateo, Santa
Barbara, Solano, Yolo, Marin, and Napa counties; or,
b) Contracts entered into under this bill establishing a
KIDS.
2) Requires, no later than January 1, 2018, in counties or
regions where there is no CCS demonstration project, DHCS to
select and enter into contracts with one or more KIDS
networks, to provide comprehensive health care services to
eligible children.
3) Defines a "KIDS" as a network approved by DHCS to coordinate
and manage the provision of Medi-Cal and CCS services for
eligible children, on a county or regional basis, consistent
with managed care principles, techniques, and practices, to
ensure access to cost-effective, quality care for enrolled
children.
4) Defines an "eligible child" for the purposes of KIDS to mean
either of the following:
a) A minor child under 21 years of age, who is eligible for
both Medi-Cal and CCS, except for those children eligible
under CCS for neonatal intensive care services; and,
b) An individual up to 26 years of age, if the individual
was previously treated for a CCS-eligible condition in the
twelve months prior to his or her 21st birthday, is
eligible for full-scope Medi-Cal services, and voluntarily
chooses to remain in a KIDS network that accepts
individuals up to age 26 under its contract with DHCS.
5) Requires a KIDS network to contract with DHCS to coordinate,
integrate, and provide or arrange for the full range of
Medi-Cal and CCS services to eligible children enrolled in
the KIDS network.
6) Requires a KIDS network contract to exclude, at a minimum,
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specialty mental health services provided by county mental
health plans and neonatal intensive care (NICU) services.
Permits a KIDS contract to exclude other Medi-Cal services,
as determined by DHCS, including, but not limited to,
long-term care, transplantation, and dental services.
7) Permits benefits of the CCS Medical Therapy Program to be
provided or coordinated by a KIDS network, in collaboration
and consultation with the designated county CCS agency or
agencies in the KIDS network service area.
8) Requires a KIDS network to:
a) Provide services to enrollees through a team-based,
patient-centered health home model, ensure that enrolled
children receive services in the most appropriate and least
restrictive setting, and adopt effective strategies to
manage and coordinate care and services for enrolled
children;
b) Report and comply with quality measures, including, but
not limited to, Medi-Cal Healthcare Effectiveness Data and
Information Set (HEDIS) measures appropriate for enrolled
children, the national Pediatric Quality Measurement System
for children's hospitals, and other quality measures
developed by DHCS in consultation with stakeholders;
c) Participate in a nationally recognized pediatric patient
safety organization; and,
d) Establish and maintain a family advisory council
composed of families of eligible children and convene the
advisory council at least quarterly.
9) Requires a KIDS network to meet specified criteria,
including an entity that demonstrates experience in
effectively serving eligible children and providing services
in compliance with CCS program standards and requirements,
that includes in the plan a sufficient number of CCS-paneled
providers to ensure continuity of care and timely access to
quality services, that develops the KIDS network through a
local collaborative stakeholder process, that incorporates
specific strategies to actively engage families as partners
in decisions affecting the health care and well-being of
children enrolled in the KIDS network, and that is anchored
by a hospital that is designated as a CCS tertiary hospital
or by a CCS provider in partnership with a CCS tertiary
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hospital.
10)Permits contracts with KIDS networks to include
opportunities to share in the risk of providing services to
KIDS enrollees under an agreement between DHCS and the KIDS
network. Requires any shared savings that result from these
arrangements to be reinvested in services provided to
children enrolled in the KIDS network.
11)Prohibits DHCS from entering into risk-sharing arrangements
with a KIDS network for specific covered services unless the
KIDS network is responsible for the management and
authorization of those services.
12)Requires payments to a KIDS network that agrees to accept
risk-sharing to be actuarially sound.
13)Requires eligibility for enrollment in a KIDS network to be
determined in accordance with all of the following:
a) Requires children to be deemed eligible for enrollment
in a KIDS network based on eligibility for the CCS program,
except a child receiving NICU services is eligible for
enrollment until the child is discharged from the NICU and
meets other requirements; and,
b) Requires eligible children to be enrolled on a mandatory
basis, to the extent that DHCS obtains federal approval to
require eligible children to enroll in an available KIDS
network in order to receive Medi-Cal and CCS services.
14)Requires enrollment in a KIDS network to be, at a minimum,
for the period of a child's CCS eligibility plus an
additional six months, provided that the child remains
eligible for Medi-Cal.
15)Allows KIDS network enrollees who continue to remain
eligible for Medi-Cal to remain in the KIDS network for up to
12 months following the termination of CCS eligibility if the
KIDS program and the parent, guardian or person responsible
for care of the child agree that it is in the best interests
of the child.
16)Requires DHCS, subject to necessary federal approvals, if a
KIDS network becomes newly available in a service area, to
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determine, in consultation with counties, KIDS networks,
local KIDS family advisory councils, and existing Medi-Cal
managed care plans in the service area, the timing and
process for enrollment in KIDS networks to ensure a smooth
transition for eligible children.
17)Permits the parent, guardian, or person responsible for the
care of the eligible child to select the KIDS network in
which the child will be enrolled if there is more than one
KIDS network in the county or region in which the child
lives. Requires the child to be assigned to a KIDS network in
a manner that ensures the least disruption in existing
patient-provider relationships if the family does not select
a KIDS network.
18)Requires, upon enrollment of an eligible child in a KIDS
network, the parent, guardian, or person responsible for the
care of the child to be informed that the child may choose to
continue an established patient-provider relationship if his
or her treating provider is a primary care provider or clinic
contracting with the KIDS, has the available capacity, and
agrees to continue to treat that eligible child. Requires
KIDS networks to comply with a continuity of care requirement
applicable to health networks.
19)Requires, within 30 days of notice that a child is no longer
eligible for a KIDS network, a child who continues to be
eligible for Medi-Cal to be enrolled in the Medi-Cal delivery
system in the county in which he or she resides. Requires
DHCS to ensure that families receive information about the
Medi-Cal delivery systems available in their county and the
process for enrolling in and selecting among the available
options.
20)Requires children, when they are disenrolling from a KIDS
network because they are no longer eligible, to be enrolled
in Medi-Cal delivery systems as follows:
a) Requires the child to be enrolled in the Medi-Cal
managed care plan if there is a Medi-Cal managed care plan
in the county of the child's residence;
b) Requires, if the family does not choose a plan for the
child within 30 days of notice of disenrollment from the
KIDS in counties where there is more than one Medi-Cal
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managed care plan, the child to be enrolled into the
Medi-Cal managed care health plan that contains his or her
primary care provider. Requires the child to be assigned to
one of the health plans containing his or her primary care
provider in accordance with the assignment process
applicable in the county if the primary care provider
participates in more than one managed care health plan in
the county; and,
c) Requires, in a county that is not a managed care county,
children no longer eligible for KIDS to be provided
services under the Medi-Cal fee-for-service (FFS) delivery
system.
21)Requires DHCS to instruct KIDS networks, counties, and
managed care plans, by means of all-county and all-plan
letters or similar instruction, as to the processes to be
used to enroll and disenroll children in KIDS networks and to
re-enroll eligible children in local Medi-Cal coverage
options, to ensure each child experiences a smooth transition
among coverage types with no gap in coverage or care.
22)Requires that a child who is enrolled in a KIDS network to
retain all rights to CCS program appeals and fair hearings of
denials of medical eligibility or of service authorizations.
23)Requires DHCS to seek all necessary federal approvals to
ensure federal financial participation in expenditures under
this section. Prohibits the KIDS provisions of this bill from
being implemented until necessary federal approvals have been
obtained.
24)Permits DHCS to seek federal approval to require all
eligible children to enroll in an available KIDS network
during the length of their eligibility for CCS plus an
additional six months. Permits a child to voluntarily remain
in the KIDS for up to 12 months following termination of CCS
eligibility if the child remains Medi-Cal-eligible.
25)Makes legislative findings and declarations regarding CCS,
and states legislative intent to modernize the CCS program
through development of specialized integrated delivery
systems focused on the unique needs of CCS-eligible children,
and to protect the unique access to pediatric specialty
services provided by CCS while promoting modern organized
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delivery systems to meet the medical care needs of eligible
children.
Comments
1)Author's statement. According to the author, this bill
authorizes the creation of KIDS to improve and modernize the
CCS program. CCS provides diagnosis, treatment, and case
management to approximately 180,000 medically fragile children
under the age of 21 with complex medical needs who meet
certain eligibility criteria. CCS has been carved out of
Medi-Cal managed care since 1993 because the Legislature
recognized this population required a unique approach. In the
twenty-three years since that time, the carve-out has been
extended numerous times, and the state has engaged in
periodic, unsuccessful, efforts to modernize the program.
December 31, 2015 marks the end of the current carve-out and
the Administration has clearly signaled that they will support
an extension of the carve-out only if it is accompanied by a
plan for a more organized delivery system. This bill provides
that system. This bill extends the carve-out, preserves the
CCS standards of care, and creates networks responsible for
providing or coordinating all medical care services to CCS
children through a patient-centered medical home, thus
improving coordination between primary and specialty care
services for beneficiaries. Additionally, the bill requires
CCS providers to work collaboratively with each other and
families, in order to ensure CCS children continue to receive
access to the highest quality care.
2)CCS. The CCS program provides diagnostic and treatment
services, medical case management, and physical and
occupational therapy health care services to children under 21
years of age with CCS-eligible conditions (e.g., severe
genetic diseases, chronic medical conditions, infectious
diseases producing major sequelae, and traumatic injuries)
from families unable to afford catastrophic health care costs.
A child eligible for CCS must be a resident of California,
have a CCS-eligible condition, and be in a family with an
adjusted gross income of $40,000 or less in the most recent
tax year. Children in families with higher incomes may still
be eligible for CCS if the estimated cost of care to the
family in one year is expected to exceed 20 percent of the
family's adjusted gross income. As of January, 2010, there
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were 178,530 children enrolled in CCS. According to DHCS, 90
percent of CCS enrollees are also eligible for Medi-Cal and 10
percent were CCS-only or were covered by other insurance.
3)Medi-Cal Managed Care and the CCS carve-out. Most Medi-Cal
beneficiaries, including children, are required to enroll in
Medi-Cal managed care plans. However, for children who are
enrolled in both Medi-Cal and CCS, CCS services were carved
out of Medi-Cal managed care pursuant to SB 1371 (Bergeson,
Chapter 917, Statutes of 1994). Under the carve out,
CCS-covered services for CCS-eligible children are not
incorporated into Medi-Cal managed care, and are instead
provided and paid for on a FFS basis through the CCS Program.
The initial carve out under SB 1371 was for three years. The
CCS carve out has been extended repeatedly since then, usually
for three or four year periods. The first extension allowed
the COHS in the counties of San Mateo, Santa Barbara, Solano,
and Napa to include CCS services. Later extensions also
allowed Yolo and Marin counties to include CCS services. DHCS
indicates the division of payment and care between CCS and the
primary Medi-Cal managed care plan has posed challenges,
including delays in care for children, fragmentation and a
lack of coordination, and increased cost to the state.
4)Medi-Cal Waiver and CCS Pilots. SB 208 (Steinberg, Chapter
714, Statutes of 2010), was one of two bills in 2010
implementing the 2010 Medi-Cal waiver renewal. One provision
of SB 208 was a requirement that the DHCS director establish,
by January 1, 2012, organized health care delivery models for
CCS-eligible children, from four specified models. Five
demonstration applicants (San Mateo Health Plan, Alameda
County, LA Care, Children's Hospital Orange County, and Rady
Children's Hospital in San Diego) were approved in 2011, but
only the San Mateo Health Plan pilot has been implemented. The
Rady Children's Hospital in San Diego is for a subset of
CCS-eligible children with specified conditions but it has not
been implemented.
5)CCS Redesign Stakeholder Advisory Board. DHCS has implemented
a stakeholder process to investigate potential improvements or
changes to the CCS program in partnership with the UCLA Center
for Health Policy Research. A CCS Redesign Stakeholder
Advisory Board (RSAB) composed of individuals from various
organizations and backgrounds with expertise in both the CCS
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program and care for children and youth with special health
care needs, was assembled in September of 2014 to lead this
process.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Senate Appropriations Committee:
1)One-time administrative costs, likely in the low millions, to
design the program requirements, adopt regulations, and
negotiate contracts with KIDS networks (General Fund and
federal funds).
2)Unknown impact on overall Medi-Cal expenditures for services
provided to CCS-eligible Medi-Cal beneficiaries (General Fund
and federal funds). There are several factors that will impact
the overall costs or savings to the state under the bill.
SUPPORT: (Verified5/27/15)
California Children's Hospital Association (sponsor)
California WIC Association
Children's Hospital of Los Angeles
Children's Hospital and Research Center Oakland
Children's Hospital of Orange County Children's
Children's Hospital of Orange County Physician Network
Children's Specialty Care Coalition
Lucille Packard Children's Hospital Stanford
Rady Children's Hospital San Diego
Together We Grow
Valley Children's Healthcare, Inc.
Valley Children's Primary Medical Group, Inc.
Western Center on Law & Poverty
OPPOSITION: (Verified5/27/15)
American Academy of Pediatrics
California Association for Health Services at Home
California Medical Association
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ARGUMENTS IN SUPPORT:
This bill is sponsored by the California Children's Hospital
Association (CCHA), which argues this bill would protect CCS and
create KIDS to modernize the delivery system. CCHA argues the
KIDS networks will use a whole child approach to health care,
improving coordination between primary and specialty care
services while retaining the high quality health care available
through CCS because the CCS program will only remain statutorily
carved out of Medi-Cal managed care until the end of 2015. CCHA
argues this bill is a thoughtful, provider driven,
patient-centered approach that preserves the positive aspects of
the CCS program while creating a delivery system tailored to the
needs of children with complex medical needs and their families.
CCHA states KIDS networks would be responsible for providing
primary and specialty medical care services to enrolled children
through a team-based, patient-centered health home model in the
least restrictive, most appropriate setting. CCHA argues this
bill would ensure that CCS standards are retained to ensure
pediatric expertise, preserve access to high quality providers,
and ensure that families are involved in decisions around the
medical care provided to their children. Under this bill, CCS
providers would be required to work together in order to improve
care coordination and health outcomes, and the regional system
of care comprised of CCS hospitals, physicians, and special care
centers benefit not only those children who receive services
through CCS as these same providers form the regional backbone
for all pediatric specialty care in California for children who
are privately insured as well as those receiving
government-subsidized care.
The California Association of Physician Groups (CAPG) writes in
support that this bill is a thoughtful, provider driven,
patient-centered approach that that preserves the positive
aspects of the CCS program while creating a delivery system
tailored to the needs of children with complex medical needs and
their families. CAPG states this bill protects the unique
regional CCS system of providers and standards that ensure
children in CCS have access to hospitals, doctors, and special
care centers with the expertise to care for them by requiring
KIDS networks to provide whole child care through a team-based,
patient-centered health home model in the least restrictive,
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most appropriate setting.
ARGUMENTS IN OPPOSITION: The American Academy of Pediatrics,
California (AAPC) writes in opposition that children with
CCS-eligible conditions are among the most vulnerable in the
state, and the state should not decide upon a specific model for
redesign of this essential system of care in advance of data
currently being collected and a robust stakeholder process that
is underway. AAPC argues that changing to a new model requires
policies/elements that cannot be fully understood until the
pilots and stakeholder process are complete and recommendations
are available to those involved. The California Medical
Association, which has taken an oppose unless amended on this
measure, makes similar arguments as AAPC, and indicates it would
remove its opposition to this bill if it were amended to extend
the current managed care carve out for an additional year while
the stakeholder board completes its work and the state reports
back on data from the pilot projects.
The California Association for Health Services at Home (CAHSAH)
argues that it is concerned about the impact of managed care
expansions on home and community-based services, especially
given the problems that have already occurred with the
Coordinated Care Initiative (CCI). CAHSAH argues managed care
entities do not understand the home health services of this
unique population, and they have experienced denials of care and
delayed authorizations that were approved under Medi-Cal FFS.
CAHSAH argues managed care delivery systems reimbursement rates
must take into account the acuity level differences in this
population, the need for a long-term guarantee of coverage to
beneficiaries, timely authorizations of care, that managed care
case managers understand the full nature of services available
under Medi-Cal, and that the managed care delivery system
address provider grievances and resolution of those grievances
using the same medically necessity criteria used FFS Medi-Cal.
Prepared by:Scott Bain / HEALTH /
5/31/15 12:49:04
**** END ****
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