BILL ANALYSIS Ó SB 1113 Page 1 Date of Hearing: August 3, 2016 ASSEMBLY COMMITTEE ON APPROPRIATIONS Lorena Gonzalez, Chair SB 1113 (Beall) - As Amended August 1, 2016 ----------------------------------------------------------------- |Policy |Education |Vote:|7 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | |Health | |17 - 0 | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill authorizes county and local educational agencies (LEAs) to establish partnerships for the purpose of providing mental health services to students. Specifically, this bill: 1)Authorizes the county mental health plan (county MHP) or the qualified provider, and an LEA, to utilize "designated governmental funds" for eligible Early and Periodic Screening, SB 1113 Page 2 Diagnosis, and Treatment (EPSDT) mental health services for students enrolled in MediCal, for special education students with an individualized education plan (IEP), and for non-special education students served by county mental health or a qualified provider. 2)Requires the partnership to determine the Medi-Cal mental health provider that is county operated or county contracted, for purposes of providing mental health services to students in LEAs. This can include the delivery of campus-based mental health services to special education students and students who a teacher believes may require those services, conditioned upon parental consent. 3)Requires the partnership agreement to determine how to cover the cost of mental health services if they are not covered by the partnership. 4)Requires the partnership to participate in the existing EPSDT performance outcome system to measure results of services provided under the partnership agreement. 5)Requires a partnership to be established in at least one school within the LEA in the first year and to expand the partnership to three additional schools within three years. 6)Establishes the County and Local Educational Agency Partnership Fund (Partnership Fund) to provide funding for partnerships through a competitive grant program. Authorizes the Superintendent of Public Instruction (SPI) to allocate funds from this account, contingent upon an appropriation in SB 1113 Page 3 the annual budget act. 7)Requires the Department of Health Care Services (DHCS), as part of the existing EPSDT performance outcome system reporting requirements, to collect and utilize certain data, including academic performance data, on children that receive mental health services as part of an IEP or educationally related mental health services from an LEA participating in the LEA Medi-Cal Billing Program as part of an IEP. The California Department of Education (CDE) is required to provide academic information to DHCS. FISCAL EFFECT: 1)Proposition 98/GF cost pressure, in the millions of dollars, to implement a competitive grant program to fund county and LEA partnerships. The author's office estimates approximately $1.8 million would be needed per LEA. The bill intends for at least three LEAs to be funded. Actual costs could be higher or lower depending upon available funding. This bill establishes a Partnership Fund to provide competitive grants to partnerships, available upon appropriation by the Legislature. The 2016-17 Budget Act does not provide funding for this purpose. The bill does not specify a fund source for the Partnership Fund and does not expressly prohibit the use of Proposition 98/GF, thereby creating cost pressure on state funds. SB 1113 Page 4 2)Annual administrative costs to the California Department of Education (CDE) of approximately $236,000 to administer the competitive grant process and work with DHCS to provide data, as specified. COMMENTS: 1)Purpose. Federal law establishes the Medi-Cal EPSDT program to provide individuals 21 years and under, periodic screenings to determine health care needs and, based upon the identified health care need and diagnosis, to provide treatment services. EPSDT provides a broad set of services to Medi-Cal eligible children, but the mental health portion of EPSDT is a smaller set of services which include group therapy, family therapy, case management, crisis counseling, medication, and other medically necessary services for children with serious mental illness. A Bureau of State Auditor report (January 2016) found that LEAs and counties could improve student access to mental health services by collaborating to provide services to Medi-Cal eligible students. Currently, LEAs cannot access funding for EPSDT services unless they contract with their respective counties. According to the author, although there are current successful partnerships, only six of the 122 Special Education Local Planning Areas (SELPAs) have an agreement with counties. One major barrier to forming partnerships is disagreement over who should pay for the state match as required under the EPSDT program. This bill is intended to provide a financial incentive, through a competitive grant process, for LEAs to enter into agreements with counties. SB 1113 Page 5 2)Background on EPSDT. County MHPs are responsible for funding and providing EPSDT mental health services to Medi-Cal eligible children who meet clinical criteria. County MHPs fulfill EPSDT obligations through direct service provision and contracts. Many county MHPs contract with LEAs or Special Education Local Plan Area (SELPAs) to provide certain services. County MHPs pay 100% of the costs of services and submit reimbursement claims to the federal government, through DHCS, to claim federal financial participation (FFP). By claiming FFP, counties can be reimbursed for about 50% of their costs. Counties fund their portion of the cost of these services through a combination of 2011 realignment funding, 1991 realignment funding, and Proposition 63 funds. 3)Background on mental health mandate. Prior to 1984, school districts were responsible for providing all special education services to children. In 1984, the Legislature enacted AB 3632, which transferred responsibility for providing mental health services to special education pupils from school districts to county mental health departments. The intent was to build on counties' existing expertise, and provide collaboration between schools and public mental health. AB 3632 services were deemed a state-reimbursable mandate. In 2010, during the state's fiscal crisis, state funding for AB 3632 was vetoed and the mandate was suspended. AB 114 (Budget Committee), Chapter 43, Statutes of 2011, repealed provisions of AB 3632, thereby ending the state mandate on county mental health agencies to provide mental health services to students with disabilities. With the passage of AB 114, school districts are now solely responsible for ensuring that students with disabilities receive special education and related services, including some services previously arranged for, or provided by, county mental health agencies. 4)Bureau of State Audit recommendations. In January 2016, the Bureau of State Audits released a report, requested by the author and other members of the Legislature, on the effect of AB 114 on mental health services for students. The audit SB 1113 Page 6 recommended that the Legislature require counties to enter into agreements with SELPAs to allow SELPAs and LEAs to access EPSDT funding. The Auditor gave the example of the Desert Mountain SELPA arrangement with San Bernardino County. Desert Mountain SELPA contributes to the county's required match of federal funds. This arrangement is mutually beneficial: San Bernardino County does not need to provide the full match, and Desert Mountain is able to access EPSDT funding to provide mental health services to Medi-Cal eligible students with and without IEPs. 5)Comments. The 2011 realignment left counties fully responsible for providing and funding specialty mental health services for Medi-Cal eligible individuals. Counties receive state funding to provide EPSDT services. If the state were to provide funding through competitive grants, as proposed by this bill, to directly draw down federal reimbursement for EPSDT services, the state could be double-paying for those services if there is not a decrease in county funding for such services. 6)Opposition. The Special Opportunities for Access and Reform Coalition (SOAR), a coalition which includes seven SELPAs, is opposed to the bill unless amended. SOAR notes there are several barriers to developing partnerships between LEAs and counties. They note some of the hurdles center on county mental health not being willing to contract/vendorize the LEA/SELPAs to provide EPSDT services, or the county mental health agency charging the LEA/SELPA a high indirect cost for developing this partnership. They note that there is no state policy on how an LEA can seek direct access to the Medi-Cal funding for the EPSDT program through county managed care, and that instead it is up to each individual LEA or SELPA to negotiate directly with their county mental health program. They recommend that the bill be amended to instead require DHCS to develop a mediation or appeals process in state law when an LEA/SELPA and county mental agency cannot agree on delivery of service for an eligible recipient or when EPSDT funding is not accessible for the LEA/SELPA. SB 1113 Page 7 Analysis Prepared by:Misty Feusahrens / APPR. / (916) 319-2081