BILL ANALYSIS                                                                                                                                                                                                    

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          (Without Reference to File)


          833 (Committee on Budget and Fiscal Review)

          As Amended  June 10, 2016

          Majority vote.  Budget Bill Appropriation Takes Effect  

          SENATE VOTE:  25-11

          SUMMARY:  This is the Omnibus Health Trailer Bill for 2016-17.   
          It contains necessary changes related to the Budget Act of 2016.  
           This bill makes various statutory changes to implement the  
          2016-17 budget.  Specifically, this bill:
          1)Children's Mental Health Crisis.  Expands the "Investment in  
            Mental Health Wellness Act of 2013" to apply to children.   
            Adds as an objective of the Act to provide a complete  
            continuum of crisis services for children and youth 21 years  
            of age and under, including early intervention and treatment  
            services, crisis intervention, crisis stabilization and crisis  
            residential treatment, increased mobile crisis support teams,  
            crisis stabilization services and beds, crisis residential  
            treatment beds, triage personnel, family respite care, and  
            family supportive training and related services.


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          2)Children's Mental Health Crisis.  Authorizes the Mental Health  
            Services Oversight and Accountability Commission to use  
            resources provided for children's mental health crisis  
            services to administer a competitive grant program to increase  
            mobile crisis support, crisis intervention, crisis  
            stabilization services, crisis residential treatment, family  
            respite care, family supportive training and related services  
            and triage personnel for children.

          3)Children's Mental Health Crisis.  Authorizes the California  
            Health Facilities Financing Authority to use resources  
            provided for children's mental health crisis services to be  
            made available to counties, private nonprofit corporations and  
            public agencies to expand capital, equipment acquisition and  
            program startup or expansion costs to increase crisis services  
            for children.

          4)Estate Recovery Limitations.  Limits estate recovery under  
            Medi-Cal to those services required to be collected under  
            federal law; limits the definition of "estate" to include only  
            the real and personal property and other assets required to be  
            collected under federal law; requires the Department of Health  
            Care Services (DHCS) to waive its claim, as a substantial  
            hardship, when the estate subject to recovery is a homestead  
            of modest value; prohibits recovery from the estate of a  
            deceased Medi-Cal member who is survived by a spouse or  
            registered domestic partner; and ensures that Medi-Cal members  
            can easily receive timely information about how much their  
            estate may owe Medi-Cal when they die.

          5)Acupuncture Optional Benefit.  Requires that acupuncture be a  
            covered benefit in the Medi-Cal program, beginning July 1,  

          6)PACE Modernization.  Reforms the rate setting methodology for  


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            the Program of All Inclusive Care for the Elderly (PACE)  
            programs by utilizing the rate-setting methodology used for  
            managed care organizations; specifies that the rate setting  
            methodology shall address unique features of PACE programs and  
            high cost drugs and treatments; requires DHCS to calculate an  
            upper payment limit for payments to PACE programs; requires  
            DHCS to adjust the rates for the first two years of a new PACE  
            program; eliminates from law the cap on the number of PACE  
            programs; clarifies that PACE programs may be for-profit  
            organizations; and authorizes DHCS to seek federal approval to  
            allow for administrative flexibilities within the operations  
            of PACE programs.

          7)Behavioral Health Treatment Transition Contract.  Authorizes  
            DHCS to expedite the contract process for the procurement of  
            case management services, until March 31, 2017, for  
            institutionally deemed Medi-Cal beneficiaries who receive  
            behavioral health treatment through Regional Centers, and for  
            whom those services are being transitioned to Medi-Cal, and  
            they will lose their Medi-Cal eligibility due to no longer  
            being institutionally-deemed eligible.

          8)Medi-Cal Workers Compensation.  Eliminates the sunset  
            provision of the operative Labor Code Section 138.7 and  
            indefinitely extends the Department of Industrial Relations  
            authority to supply work-related injury or claim data from the  
            Workers' Compensation Information System to DHCS.

          9)Medi-Cal Emergency Medical Air Transportation.  Removes a  
            statutory requirement that DHCS study long-term funding  
            strategies to replace the existing traffic penalty fee funding  
            for emergency medical air transportation and instead requires  
            DHCS, by March 1, 2017, in coordination with the Department of  
            Finance, to notify the Legislature of the fiscal impact to  
            Medi-Cal of, and the planned reimbursement methodology for,  
            emergency medical air transportation services after the  


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            termination of penalty assessments pursuant to subdivision (f)  
            of Section 76000.10 of the Government Code on January 1, 2018.

          10)Electronic Health Records.  Increases the statutory cap on  
            General Fund in the Electronic Health Records Incentive  
            program from $200,000 to $425,000.

          11)Supplemental Drug Rebates.  Makes technical changes to  
            statute to clarify DHCS's authority to collect state  
            supplemental drug rebates.

          12)Outpatient Drug Federal Final Rule.  Authorizes DHCS to  
            comply with the federal Final Rule related to reimbursements  
            for covered outpatient drugs, requiring states to align  
            pharmacy reimbursements with actual acquisition costs of  
            drugs, and to pay an appropriate professional dispensing fee,  
            beginning April 1, 2017.

          13)County COLA.  Suspends the county cost-of-living adjustment  
            (COLA) for Medi-Cal eligibility work rates for 2016-17.

          14)Long-Term Care Fund Continuous Appropriation.  Makes the  
            Long-Term Care Quality Assurance Fund continuously  
            appropriated without regard to fiscal year.

          15)Naloxone Grant Program.  Establishes a community grant  
            program in the Department of Public Health (DPH) that provides  
            naloxone kits, for the prevention of overdose fatalities, to  
            community organizations and first responders.

          16)OA-HIPP Out of Pocket Costs.  Requires the Office of AIDS  
            Health Insurance Premium Payment Program (OA-HIPP) to cover  


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            premiums, copays, coinsurance and deductibles for all eligible  
            people with HIV/AIDS; requires OA-HIPP to cover copays,  
            coinsurance and deductibles incurred by individuals accessing  
            Pre-Exposure Prophylaxis (PrEP) with annual incomes below 500%  
            of the Federal Poverty Level.

          17)Office of AIDS Cost Sharing.  Eliminates copays and other  
            out-of-pocket costs in the AIDS Drug Assistance Program (ADAP)  
            and other Office of AIDS programs.

          18)Hepatitis Prevention.  Requires DPH to perform various  
            functions related to hepatitis prevention, including:  
            purchasing and distributing hepatitis B vaccines for local  
            health jurisdictions; purchasing hepatitis C rapid test kits  
            to distribute to community-based testing programs; certifying  
            non-medical personnel to perform rapid hepatitis and HIV  
            testing in community-based settings; and engaging the Office  
            of AIDS to provide technical assistance to local governments  
            to increase the number of syringe exchange and disposal  
            programs in California.

          19)Alzheimer's Early Detection.  Requires California Alzheimer  
            Disease Centers to utilize state funds to determine the  
            standard of care for the early and accurate diagnosis of  
            Alzheimer's, provide professional outreach and education, and  
            to evaluate the educational effectiveness of these efforts.

          20)Covered California Emergency Regulations.  Extends the  
            emergency regulations authority for Covered California until  
            January 1, 2019, to implement the eligibility, enrollment and  
            appeals processes for the individual and small business  
            exchanges, changes to the small business exchange, or  
            legislation, that amends the Title that established the  
            California Health Benefit Exchange, that is enacted prior to  
            December 31, 2016.


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          21)CalOHII.  Makes technical and clarifying changes to the  
            California Office of Health Information Integrity's (CalOHII)  
            duties with regard to continued compliance with the federal  
            Health Insurance Portability and Accountability Act (HIPAA);  
            aligns and clarifies CalOHII's statutory role and  
            responsibilities to be consistent with ensuring that the  
            state's HIPAA policy remains consistent statewide and  
            conducting compliance reviews of state departments impacted by  

          COMMENT:  This bill is a budget trailer bill within the overall  
          2016-17 budget package to implement actions taken affecting the  
          Departments of Health Care Services and Public Health,  
          California Health Benefit Exchange, California Health Facilities  
          Financing Authority, Mental Health Services Oversight and  
          Accountability Commission and the California Office of Health  
          Information Integrity.

          Analysis Prepared by:                                             
                          Andrea  Margolis / BUDGET / (916) 319-2099  FN: