BILL NUMBER: AB 644 CHAPTERED 07/07/00 CHAPTER 95 FILED WITH SECRETARY OF STATE JULY 7, 2000 APPROVED BY GOVERNOR JULY 6, 2000 PASSED THE ASSEMBLY JUNE 22, 2000 PASSED THE SENATE JUNE 15, 2000 AMENDED IN SENATE JUNE 12, 2000 AMENDED IN SENATE MAY 18, 2000 AMENDED IN SENATE SEPTEMBER 8, 1999 AMENDED IN SENATE SEPTEMBER 2, 1999 AMENDED IN SENATE AUGUST 26, 1999 AMENDED IN ASSEMBLY MAY 18, 1999 AMENDED IN ASSEMBLY APRIL 19, 1999 INTRODUCED BY Assembly Member Ducheny FEBRUARY 23, 1999 An act to amend Sections 19356.6 and 19356.7 of, and to amend and repeal Section 19355.5 of, the Welfare and Institutions Code, relating to habilitation services, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST AB 644, Ducheny. Habilitation services. Existing law establishes the Habilitation Services Program, administered by the Department of Rehabilitation, under which supported employment and other services are provided to persons with developmental disabilities. Under existing law, the $27.50 hourly rate established for the 1999-2000 fiscal year for supported employment services must be reduced by the percentage necessary to ensure that projected total General Fund expenditures and reimbursements for habilitation services and vocational rehabilitation supported employment services do not exceed the General Fund and reimbursement appropriations for these services in the Budget Act of 1999. This bill would revise the implementation date of this provision, would delete the reference to the 1999-2000 fiscal year, would exclude increases in job coach hours in certain circumstances, would specify procedures for implementation of this provision, and would repeal the provision January 1, 2004. Under existing law, certain Habilitation Services Program ratesetting provisions would become inoperative on July 1, 2000. This bill would extend the operative dates of these provisions until September 1, 2003, and would make various changes in ratesetting provisions pertaining to supported employment services. This bill would appropriate $3,254,000 from the General Fund and $1,564,000 from the Federal Trust Fund for supported employment services under this program provided during the 1999-2000 fiscal year. This bill would declare that it is to take effect immediately as an urgency statute. Appropriation: yes. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. (a) It is the intent of the Legislature, in enacting this act, to fund a current-year deficiency resulting from expenditures in excess of Budget Act of 1999 appropriations and reimbursements for habilitation services and vocational rehabilitation supported employment services. It is the further intent of the Legislature to amend supported employment reimbursement rate provisions to control supported employment costs and eliminate excess expenditures resulting from unregulated changes in the number of clients in group placement, payments for clients not funded by the Department of Rehabilitation, and for other inefficiencies. (b) The Legislature finds and declares that this act is necessary because Section 19355.5 of the Welfare and Institutions Code requires a rate reduction in order to avoid a deficiency. SEC. 2. Section 19355.5 of the Welfare and Institutions Code is amended to read: 19355.5. (a) Notwithstanding any other provision of law, effective July 1, 2000, the twenty-seven dollar and fifty cent ($27.50) hourly rate for supported employment services established pursuant to paragraph (2) of subdivision (b) of Section 19356.6 shall be reduced by the percentage necessary to ensure that projected total General Fund expenditures and reimbursements for habilitation services and vocational rehabilitation supported employment services, including services pursuant to paragraph (2) of, and clauses (i) to (iii), inclusive, of subparagraph (B) of paragraph (2) of, subdivision (b) of Section 19356.6, and, for the habilitation services program only, ancillary services, based on Budget Act caseload projections, do not exceed the General Fund and reimbursement appropriations for these services in the annual Budget Act, exclusive of increases in job coach hours due to unanticipated increases in caseload or the average client workday. This reduction shall not be implemented sooner than 30 days after notification in writing of the necessity for the reduction to the appropriate fiscal committees and policy committees of the Legislature and the Chairperson of the Joint Legislative Budget Committee, or not sooner than whatever lesser time the chairperson of the joint committee, or his or her designee, may in each instance determine. (b) The department shall annually make three projections of General Fund expenditures and reimbursements, which shall be based on invoices for supported employment services received by October 5, January 5, and April 5 of each fiscal year, respectively, and projections shall be submitted to the Department of Finance no later than 30 days after these dates. The projected expenditures shall be based on the number of job coach hours for which the state has been billed and projected caseload growth, including change in the average client workday. (c) This section shall not be implemented until the Department of Finance certifies to the Legislature that the Department of Rehabilitation is able to compile and provide timely data on job coach hours, group size, and average client workday in the supported employment program. (d) This section shall become inoperative on September 1, 2003, and as of January 1, 2004, is repealed, unless a later enacted statute that becomes operative on or before January 1, 2004, deletes or extends the dates on which it becomes inoperative and is repealed. SEC. 3. Section 19356.6 of the Welfare and Institutions Code is amended to read: 19356.6. (a) The definitions contained in this subdivision shall govern the construction of this section, with respect to services provided through the Habilitation Services Program, and unless the context requires otherwise, the following terms shall have the following meanings: (1) "Supported employment" means paid work that is integrated in the community for individuals with developmental disabilities whose vocational disability is so severe that they would be unable to achieve this employment without specialized services and would not be able to retain this employment without an appropriate level of ongoing postemployment support services. (2) "Integrated work" means the engagement of an employee with a disability in work in a setting typically found in the community in which individuals interact with nondisabled individuals other than those who are providing services to those individuals, to the same extent that nondisabled individuals in comparable positions interact with other persons. (3) "Supported employment placement" means the employment of an individual with a developmental disability by an employer in the community, directly or through contract with a supported employment program, and the provision of supported employment services including the provision of ongoing postemployment services necessary for the individual to retain employment. Services for those individuals receiving individualized services from a supported employment program shall decrease as the individual adjusts to his or her employment and the employer assumes many of those functions. (4) "Allowable supported employment services" means the services approved in the individual habilitation component and provided, to the extent allowed by the Habilitation Services Program for the purpose of achieving supported employment as an outcome for individuals with developmental disabilities, which may include any of the following: (A) Program staff time spent conducting job analysis of supported employment opportunities for a specific consumer. (B) Program staff time spent in the direct supervision or training of a consumer or consumers while they engage in integrated work unless other arrangements for consumer supervision, such as employer supervision reimbursed by the supported employment program, are approved by the Habilitation Services Program. (C) Training occurring in the community, in adaptive functional and social skills necessary to ensure job adjustment and retention such as social skills, money management, and independent travel. (D) Counseling with a consumer's significant others to ensure support of a consumer in job adjustment. (E) Advocacy or intervention on behalf of a consumer to resolve problems affecting the consumer's work adjustment or retention. (F) Job development to the extent authorized by the Habilitation Services Program. (G) Ongoing postemployment support services needed to ensure the consumer's retention of the job. (5) "Group services" means job coach-supported employment services in a group supported employment placement at a job coach-to-client ratio of not less than one-to-three nor more than one-to-eight where a minimum of three clients are department-funded. (6) "Individualized services" means job coach and other supported employment services for department-funded clients in a supported employment placement at a job coach-to-client ratio of one-to-one. (b) (1) The Habilitation Services Program shall set rates for supported employment services provided in accordance with this section. The Habilitation Services Program shall apply rates in accordance with this section to those work-activity programs or program components of work-activity programs approved by the department to provide supported employment and to new programs or components approved by the Habilitation Services Program to provide supported employment services. Both of these categories of programs or components shall be required to comply with the criteria set forth in subdivision (b) of Section 19356.7 to receive approval from the Habilitation Services Program. (2) (A) The hourly rate for supported employment services provided to clients receiving individualized services shall be twenty-seven dollars and fifty cents ($27.50). (B) The hourly rate for group services shall be twenty-seven dollars and fifty cents ($27.50) regardless of the number of clients served in the group. Clients in a group shall be scheduled to start and end work at the same time, unless an exception is approved in advance by the Habilitation Services Program. The department, in consultation with stakeholders, shall adopt regulations to define the appropriate grounds for granting these exceptions. Where the number of clients in a group supported employment placement drops to fewer than three department-funded clients, the program provider shall, within 90 days from the date of this occurrence and consistent with Section 19356.7, do one of the following: (i) Add one or more department-funded clients to the group. (ii) Move the remaining clients to another existing group. (iii) Move the remaining clients, if appropriate, to individualized placement. (iv) Terminate services. (C) For clients receiving group services the Habilitation Services Program may set a higher hourly rate for supported employment services, based upon the additional cost to provide ancillary services, when there is a documented and demonstrated need for a higher rate because of the nature and severity of the disabilities of the consumer, as determined by the Habilitation Services Program. (D) In addition, fees shall be authorized for the following: (i) A two hundred dollar ($200) fee shall be paid upon intake of a consumer into an agency's supported employment program, unless that individual has completed a supported employment intake process with that same agency within the past 12 months, in which case no fee shall be paid. (ii) A four hundred dollar ($400) fee shall be paid upon placement of an individual in an integrated job, unless that individual is placed with another consumer or consumers assigned to the same job coach during the same hours of employment, in which case no fee shall be paid. (iii) A four hundred dollar ($400) fee shall be paid after a 90-day retention of a consumer in a job, unless that individual has been placed with another consumer or consumers, assigned to the same job coach during the same hours of employment, in which case no fee shall be paid. (3) These rates shall take effect July 1, 1998. (4) It is the intent of the Legislature that, commencing July 1, 1996, the department establish rates for both habilitation services and vocational rehabilitation supported employment services pursuant to this section. (5) For individuals receiving individualized services, services may be provided on or off the jobsite. (6) For individuals receiving group services, ancillary services may be provided, except that all postemployment and ancillary services shall be provided at the worksite. (c) If a consumer has been placed on a waiting list for vocational rehabilitation as a result of the department's order of selection regulations, the Habilitation Services Program may pay for those supported employment services leading to job development set forth in subparagraph (D) of paragraph (2) of subdivision (b). (d) The Habilitation Services Program shall approve, in advance, any change in the number of clients served in a group. (e) The department, in consultation with appropriate stakeholders, shall report to the Department of Finance and the Legislature, on or before January 1, 2001, and annually thereafter, on the implementation of supported employment rates and group size requirements pursuant to this section. The report shall include, but not be limited to, data on the sizes of client groups, the change in average group size, client outcomes, client earnings, to the extent available, and projected caseload and expenditures for the supported employment program. On or before February 1, 2003, the department shall submit to the Department of Finance and the Legislature a final report containing, at a minimum, cumulative data and outcome measures, and shall include recommendations on whether to extend the effective dates of this section and Sections 19355.5, 19355.6, and 19356.7, and recommendations for appropriate changes to those sections. (f) This section shall become inoperative on September 1, 2003, and, as of January 1, 2004, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2004, deletes or extends the dates on which it becomes inoperative and is repealed. SEC. 4. Section 19356.7 of the Welfare and Institutions Code is amended to read: 19356.7. (a) Proposals for funding of new, and modifications to existing, supported employment programs and components by the Habilitation Services Program shall be submitted to the Habilitation Services Program and shall contain sufficient information to enable the Habilitation Services Program to act on the proposal under this section. (b) Provided that sufficient funding is available to finance services by supported employment programs and components, the Habilitation Services Program may approve or disapprove proposals based on all of the following criteria: (1) The need for a supported employment program or component. (2) The capacity of the program to deliver supported employment services effectively. (3) The ability of the program to comply with accreditation requirements of the Habilitation Services Program. The accreditation standards adopted by the department shall be the standards developed by the Commission of Rehabilitation Facilities and published in the most current edition of the Standards Manual for Organizations Serving People with Disabilities, as well as any subsequent amendments to the manual. (4) A profile of an average consumer in the program or component, showing the planned progress toward self-reliance as an employee, measured, as appropriate, in terms of decreasing support services. (5) The ability of the program to achieve integrated paid work on the average for consumers served. (c) The Habilitation Services Program may purchase supported employment services at the rates authorized in Section 19356.6 only from supported employment programs or components approved under this section. (d) For purposes of evaluating the effectiveness of the entire program, and individual supported employment programs or components, the Habilitation Services Program may monitor supported employment programs or components to determine whether the performance agreed upon in the approved proposal is being achieved. When the performance of a supported employment program or component does not comply with the criteria according to which it was approved for funding pursuant to subdivision (b), the Habilitation Services Program may establish prospective performance criteria for the program or component, with which the program or component shall comply as a condition of continued funding. (e) The department shall adopt regulations to implement the requirements of Sections 19352, 19356.6, and this section, in consultation with the California Rehabilitation Association, the United Cerebral Palsy Association, and the Association of Retarded Citizens of California. (f) This section shall become inoperative on September 1, 2003, and, as of January 1, 2004, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2004, deletes or extends the dates on which it becomes inoperative and is repealed. SEC. 5. (a) There is hereby appropriated the sum of four million eight hundred eighteen thousand dollars ($4,818,000) to the Department of Rehabilitation, as follows, for the purposes specified in subdivision (b): (1) Three million two hundred fifty-four thousand dollars ($3,254,000) from the General Fund. (2) One million five hundred sixty-four thousand dollars ($1,564,000) from the Federal Trust Fund. (b) Funds appropriated pursuant to subdivision (a) shall be used for the cost of supported employment services provided for pursuant to Section 19356.6 provided during the 1999-2000 fiscal year. SEC. 6. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: By immediately funding the Habilitation Services Program deficiency identified in Section 1 of this act, this act prevents a major reduction in the 1999-2000 fiscal year hourly reimbursement rate for supported employment services for adults with developmental disabilities that would otherwise be implemented pursuant to Section 19355.5 of the Welfare and Institutions Code. In addition, this act, by establishing new measures to control expenditures for supported employment services, would ensure the fiscal integrity of the program. In order, therefore, to avoid a major disruption in supported employment services during the 1999-2000 fiscal year, and to ensure that the fiscal integrity of that program is maintained at the earliest possible time, it is necessary that this act go into immediate effect.