BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 638 (Stone) - Developmental services: funding
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|Version: April 21, 2015 |Policy Vote: HUMAN S. 4 - 0 |
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|Urgency: No |Mandate: No |
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|Hearing Date: May 11, 2015 |Consultant: Brendan McCarthy |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: SB 638 would raise a variety of rates paid by regional
centers to vendors who provide services to developmentally
disabled consumers, authorize certain vendors to spend
additional funds provided by regional centers for administrative
costs, and increase funding to regional centers for staffing.
The bill would require the Department of Developmental Services
to develop a report on the funding of the regional center
system.
Fiscal
Impact:
Ongoing costs of about $420 million per year for the initial
increase in rates paid to vendors of certain services 10%
(General Fund and federal funds).
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Additional annual costs in future years of about $100 million
per year to adjust vendor rates for inflation (General Fund
and federal funds).
Ongoing costs in the tens of millions per year for additional
purchase of services to offset the redirection of regional
center funding to administrative purposed by vendors. The bill
authorizes vendors to increase the amount of regional center
funding they may use to pay for their administrative costs. As
funds are redirected from providing services towards
administration, the regional centers will most likely need to
purchase additional services from those vendors to ensure
consumers' needs are being met. For example, if half of the
existing regional center vendors (by revenue) increase their
use of funding for administration by five percent, total costs
would be about $100 million per year.
Ongoing costs of about $50 million per year to provide
additional funding to the regional centers to support their
core staffing (General Fund and federal funds).
Ongoing costs of about $64 million per year to provide
additional funding to vendors to offset the increase of the
state's minimum wage to $10 per hour (General Fund and federal
funds). Note that the Governor's Budget Proposal includes
funding for this cost.
Ongoing costs of $10 million per year to pay increased rates
for supportive employment services (General Fund and federal
funds).
Unknown costs to ensure that the rates for community care
facilities permit the viability of those services (General
Fund and federal funds).
One-time costs, likely in the hundreds of thousands to develop
a plan regarding the provision of services for the
developmentally disabled (General Fund).
Background: California provides community-based services to approximately
250,000 persons with developmental disabilities and their
families through a statewide system of 21 regional centers.
Regional centers are private, nonprofit agencies under contract
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with the Department of Developmental Services for the provision
of various services and supports to people with developmental
disabilities. As a single point of entry, regional centers
provide diagnostic and assessment services to determine
eligibility; convene planning teams to develop an Individual
Program Plan for each eligible consumer; and either provide or
obtain from generic agencies appropriate services for each
consumer in accordance with the Individual Program Plan.
In recent year, a variety of rate freezes and rate reductions
were imposed on the regional center system to help balance the
state budget.
Currently, the Secretary of the Health and Human Services Agency
is leading a taskforce to study the state's system for providing
services in the community to individuals with developmental
disabilities.
Proposed Law:
SB 638 would raise a variety of rates paid by regional centers
to vendors who provide services to developmentally disabled
consumers, authorize certain vendors to spend additional funds
provided by regional centers for administrative costs, and
increase funding to regional centers for staffing. The bill
would require the Department of Developmental Services to
develop a report on the funding of the regional center system.
Specific provisions of the bill would:
Require the Department of Developmental Disabilities to
develop a plan to ensure the sustainability, quality, and
transparency of community-based services for individuals with
developmental disabilities;
Relax an existing limit on the use of regional center funds
for administrative costs by vendors (currently 15%), allowing
vendors who receive between $500,000 and $2,000,000 to spend
20% on administration, and vendors who receive less than
$250,000 to spend 25% on administration;
Require the Department to ensure that rates established for
community care facilities permit the viability of those
facilities;
Require the Department to adopt emergency regulations to set
rates for those facilities;
Require the Department to increase rates for specified
services by 10%, including community care facilities,
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residential service providers with negotiated rates, supported
living services with negotiated rates, non-residential service
providers, service providers with negotiated rates;
Require the Department to subsequently increase the rates
(listed immediately above) every year in accordance with
increases in California Consumer Price Index;
Require the Department to increase funding to regional centers
for their core staffing by 10%;
Require the Department to provide funding to regional centers
to pay for the costs of state-wide minimum wage increases,
local minimum wage increases, increased compensation to exempt
employees relating to minimum wage increases, and other,
related wage adjustments;
Increase the rates paid for supported employment services to
specified levels.
Related
Legislation: AB 1626 (Maienschein, 2014) would have raised
rates for supported employment services, similar to those in
this bill. That bill was held on this committee's Suspense File.
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