BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 1024 (Hancock) - Developmental services: supported
employment
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|Version: March 29, 2016 |Policy Vote: HUMAN S. 4 - 0 |
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|Urgency: No |Mandate: No |
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|Hearing Date: May 2, 2016 |Consultant: Brendan McCarthy |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: SB 1024 would require the Department of Developmental
Services to provide an incentive (of at least a 10% rate
differential) to encourage the provision of individual supported
employment services to regional center consumers.
Fiscal
Impact:
Likely ongoing costs in the hundreds of thousand for the
regional centers to collect and report data to the Department
of Developmental Services and for the Department to analyze
that data and report to the Legislature (General Fund).
Likely ongoing costs of about $2 million per year to provide a
rate increase for individual supported employment services
currently being provided to regional center consumers (80%
General Fund, 20% federal funds). About 4,300 individuals are
currently receiving individual supported employment services.
If the Department raises the current rate for supported
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employment services by 10% over the projected budget year
rate, the total annual cost will be about $2.1 million per
year.
Likely ongoing costs in the hundreds of thousands per year to
provide individual supported employment services at the higher
rate to additional regional center consumers (General Fund and
federal funds). By raising the rate paid for individual
supported employment services, the bill may make it more
financially feasible for regional center vendors to offer
individual supported employment services to more regional
center consumers - either consumers who would otherwise
receive group supported employment services or consumers
receiving work activity services. It is likely that most
consumers newly receiving individual supported employment
services would shift from group supported employment services,
but it is possible that some consumers currently being served
by work activity programs could find competitive employment
with more individual supported employment services.
Unknown annual savings due to consumers gaining and retaining
competitive employment (General Fund and federal funds). To
the extent that additional individual supported employment
services improves the employment prospects of regional center
consumers, it is possible that consumers will shift from more
expensive work activity programs to less expensive supported
employment programs (wherein consumers are employed in the
community, with ongoing assistance from regional center
vendors). It is important to note that regional centers spend,
on average, about $4,100 per consumer per year on individual
supported employment services, whereas the regional centers
spend on average $5,800 for work activity programs and $12,500
for group supported employment services. The extent of this
impact is difficult to predict and will be heavily influenced
by recent changes in federal regulations that are likely to
result in a reduction in the use of work activity programs.
Background: The Department of Developmental Services is responsible for
coordinating services and supports for about 250,000 people with
developmental disabilities. The vast majority of these people
are served by 21 regional centers, which are non-profit entities
that contract with the state. The regional centers, in turn,
contract with vendors to provide direct services to the
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developmentally disabled. Regional centers provide a variety of
services to consumers. Work activity programs provide consumers
the ability to work in a sheltered environment. Supported
employment programs provide services to consumers to prepare
them and support them in gaining and keeping employment in the
competitive labor market. Under current law, regional center
vendors are paid the same hourly rate to provide supported
employment services to individual consumers (i.e. one-on-one
training and support) or group supported employment services
(where multiple consumers are trained together).
The federal Centers for Medicare and Medicaid Services has
adopted revised program regulations for state Medicaid programs
that cover regional center consumers participating in the
state's Home and Community Based Services Waiver. Under the
changes, the state will be obligated to ensure that consumers
are integrated into the community, including having access to
work in competitive employment. The Department of Developmental
Services is in the process of developing a plan to bring its
waiver programs into compliance with the new federal
requirements.
AB X2 1 (Thurmon, Statutes of 2016) raised a number of rates for
services provided through the regional center system, including
implementing an 11.1% rate increase for supported employment
services and a 7.5% increase for enhancing wages and benefits
for staff who spend most of their time providing direct services
to consumers. That bill also requires the Department to submit a
rate study to the Legislature by March 1, 2019.
Proposed Law:
SB 1024 would require the Department of Developmental Services
to provide an incentive (of at least a 10% rate differential) to
encourage the provision of individual supported employment
services.
Specific provisions of the bill would:
Require the Department to provide a clear financial
incentive to encourage the development of and support for
consumers in individual supported employment;
Require the incentive to establish at least a 10% rate
differential for individual supported employment services;
Authorize the Department to adjust the rate for
individual supported employment services to administer the
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incentive payment;
Require the Department to consider a new rate setting
methodology for employment and habilitation services a
priority;
Require the Department to collect data about regional
center consumers' access to employment and report annually
to the Legislature.
Related
Legislation:
SB 577 (Pavley, Statutes of 2014) created a pilot
project to evaluate whether community based vocational
development services are necessary for supported
employment. That pilot project has not been implemented.
SB 1427 (Pavley) would require the Department of
Developmental Services to establish a Work Transition
Project to assist regional center consumers currently
placed in segregated work settings to transition to
competitive integrated employment. That bill will be heard
in this committee.
Staff
Comments: As noted above, the state is in the process of
planning for changes to the way that it provides services to
developmentally disabled individuals who are eligible for the
Home and Community Based Services Waiver. The intent of this
bill is in keeping with the new federal requirements for serving
individuals in an integrated manner with the larger community.
However, it is not yet clear how the requirements of this bill
will conform to the state's ultimate plan for compliance with
the new federal requirements.
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