BILL ANALYSIS
SENATE HUMAN
SERVICES COMMITTEE
Senator Carol Liu, Chair
BILL NO: AB 324
A
AUTHOR: Beall
B
VERSION: June 1, 2009
HEARING DATE: June 23, 2009
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FISCAL: To Appropriations
2
4
CONSULTANT:
Hailey
SUBJECT
Aging; Elder Economic Security Standard Index
SUMMARY
Requires area agencies on aging to use the elder economic
security standard index in their service planning and
requires the California Department of Aging to update the
elder index annually.
ABSTRACT
Current law
1)Establishes the federal Older Americans Act which
provides a national network of state units on aging and
area agencies on aging to deliver home and
community-based programs for older adults, including
nutrition, transportation, information and assistance,
elder abuse prevention, and caregiver support.
2)Establishes the Older Californians Act which provides
state-funded programs and services for older adults and
people with disabilities.
3)Establishes the California Department of Aging as the
state unit on aging to administer a broad range of home
Continued---
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and community-based programs and to provide leadership to
the area agencies on aging in developing systems of home
and community-based services that maintain individuals in
their own homes or least restrictive homelike
environments.
4)Requires the department to develop minimum standards for
service delivery to ensure that programs meet consumer
needs, operate in a cost-effective manner, and preserve
the independence and dignity of aging Californians.
5)Establishes the area agencies on aging as the entities
that provide for and deliver services under the Older
Americans Act, the Older Californians Act, and other
funding sources at the local level.
6)Requires area agencies on aging to conduct regular needs
assessments in their planning and service area to
document the service needs of older adults and adults
with disabilities.
7)Requires each area agency to develop and submit to the
department an area plan every four years that must
include the available data and population trends, assess
the community's need for services, identify sources of
funding for those services, and develop and implement a
plan for the delivery of those services based on the
community's needs.
8)Defines "greatest economic need" as need resulting from
an income level at or below the poverty threshold
established by the Bureau of the Census (Welfare and
Institutions Code Section 9014), directs the California
Department on Aging to
provide an annual update for each service
planning area of changes in population
characteristics including persons over 60 years of
age of greatest economic need,
to ensure that new funds provided to service
and planning areas be expended on persons with the
greatest economic need, and
to ensure that funding decisions to reach
parity among the service and planning areas will be
based in part on targeting services to those of
greatest economic need. (WIC Sections 9111 and 9112)
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1)Specifies that in fulfilling their mission, area agencies
shall build upon the resources unique to each community
and be guided by a description of a community-based
system that includes the assurance that all services are
readily accessible to all older adults, involves a
collaborative decision making process, and offers special
help or targeted resources for the most vulnerable older
individuals, those in danger of losing their
independence.
2)Establishes the linkages program to provide comprehensive
case management to help frail elderly and adults with
disabilities remain in their homes: it is designed to
serve individuals who are not eligible for other care
management programs, and there are no income criteria for
clients, but they must have some difficulty with
completing their daily activities to qualify for the
program.
3)Requires the department to develop a state plan on aging
every four years based upon the local area plans and to
submit the plan to the federal administration on aging.
4)Establishes the federal poverty guideline, issued each
year in the Federal Register by the Department of Health
and Human Services, for use in determining financial
eligibility for certain federal programs.
This bill
1)Amends the Mello-Granlund Older Californians Act and
entitles this set of amendments "the Elder Economic
Dignity Act of 2009."
2)Defines "elder economic security standard index" as an
index developed by the Gerontology Institute at the
University of Massachusetts, Boston, which uses publicly
available data to quantify the costs in the private
market of basic needs for elders, including, but not
limited to, food, shelter, health care, transportation,
utilities, and essential household items.
3)Redefines "greatest economic need" to mean the need
resulting from an income level at or below thresholds
established by the elder index instead of using the
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poverty threshold established by the Census Bureau.
4)Requires the department to report elder index data for
each service area in its state plan.
5)Requires the department, beginning in 2010, to update
annually the elder index for each county in California,
using the methodology developed for the 2008 elder index,
beginning in 2010, and calculate the number, percentage,
and demographic profile of older adults living below the
elder index using the most recent data available.
6)Requires the department to analyze the number and
percentage of older adults living below the updated elder
index for that year by county, race, ethnicity, gender,
age, housing situation, and other relevant demographic
factors.
7)Allows the department to contract with the office of the
president of the University of California to modify the
elder index for California and update the demographic and
financial data.
8)Specifies that each area agency's area plan must utilize
the elder index and identify which elders are living at
or below the elder index as well as specify the costs of
meeting basic needs for older adults in their respective
planning and service area.
9)Requires area agencies to update annually the linkages
program intake form to include the most current elder
index adopted by the department, in order to identify
older adults in economic need and refer them to other
resources and programs.
10)Specifies that this bill shall not be construed to
mandate changes in the current funding allocations to
area agencies.
FISCAL IMPACT
According to the Assembly Appropriations Committee,
one-time costs of $45,000 General Fund for the department
to contract with the University of California, Los Angeles
to modify the elder index for use in California. On-going
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costs will likely be less, depending on the complexity of
annual updates to the elder index.
BACKGROUND AND DISCUSSION
Measuring economic need
According to the author, recent research from UCLA and the
Insight Center for Community Economic Development has shown
that 495,000 older Californians living alone in 2007 lacked
sufficient income to pay for a minimum level of housing,
food, health care, transportation and other basic expenses.
Since 1965, there have been two slightly different versions
of the federal poverty measure - the federal poverty
guidelines and the federal poverty thresholds. The poverty
thresholds are the original version of the federal poverty
measure and are updated by the U.S. Census Bureau each
year. The thresholds are used primarily for statistical
purposes. The guidelines are issued each year in the
Federal Register and are a simplification of the poverty
thresholds. They are used for administrative purposes,
including determining financial eligibility for certain
federal programs. The federal poverty guidelines are
sometimes loosely referred to as the federal poverty level.
The author believes that policymakers struggle when they
try to create effective policies to promote economic
security and eradicate poverty because they do not have an
accurate picture of what it takes to make ends meet in
today's economy. The author believes that lawmakers use a
federal poverty measure, when determining eligibility for
benefits, that is based on a multiplier of the cost of an
adequate diet, adjusted annually using the Consumer Price
Index. The author believes that the resulting poverty
guideline is further limited in value by its
once-size-fits-all nature: the poverty guideline is one
figure, by family size, for every community in the
continental United States from urban to rural areas.
A new index for measuring elders' economic situations
In response to perceived shortcomings of the federal
poverty guidelines, sponsors of this bill propose that the
California Department of Aging and the 33 area agencies on
aging use for planning and reporting an economic index
developed at the Gerontology Institute of the University of
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Massachusetts, Boston. The index, called the elder
economic security standard index, uses housing, food,
health care, transportation and miscellaneous costs to
determine the cost for a person over 65 years of age to
meet basic needs and maintain independence in their
community. According to the author, the elder index uses
national and state data sources, including the U.S. Census
Bureau and the U.S. Department of Housing and Urban
Development.
According to the author, the index demonstrates that a
person over 65 in California needs an income of about 200
percent of the federal poverty guideline to meet basic
needs.
Effect of the new measure on planning and service delivery
Adoption of this bill will increase the number of persons
for whom area agencies on aging must plan. It will also
make eligible for some services those aged individuals
whose incomes fall between the federal poverty thresholds
and the new elder index.
While programs and services administered by the California
Department of Aging and the area agencies on aging do not
require means-testing for eligibility, the federal Older
Americans Act requires that preference be given to older
adults with the greatest economic or social needs, with
particular attention given to low-income minority
individuals. To meet the federal requirements, the
department and area agencies track data, including poverty
data, on the number of older adults and people with
disabilities within a given area. One effect of this bill
would be to increase the number of persons whom the
department and area agencies plan for and track and to
increase the number of persons who would be considered a
priority for receiving services.
UCLA has calculated county-by-county indices for California
using 2007 data
The Center for Health Policy Research at the University of
California, Los Angeles, has calculated the elder index for
each California county, using 2007 data, and center staff
have put the results on line:
http://www.healthpolicy.ucla.edu/elder_index08feb.html .
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For purposes of comparison, the biggest differences are
within counties when comparing persons who have a mortgage
payment or are renters with those who do not rather than
between and among counties. For example, here are the
elder indices for Los Angeles, San Francisco, San Luis
Obispo, and Santa Clara counties, counties that members of
the Human Services Committee represent. Again, according
to UCLA, these figures are an estimate of the "basic income
needed to make ends meet for retired persons ages 65 and
older."
Elder index per year by county:
County Single w/o mortgageSingle w/
mortgage Single renter
Los Angeles $16,355 $30,591$22,827
San Francisco $17,586 $37,893$27,435
San Luis Obispo $17,587 $30,588$22,380
Santa Clara $17,632 $37,641$25,391
Note: Los Angeles data exclude Los Angeles City
Source: UCLA Center for Health Policy Research
For couples in San Francisco, San Luis Obispo, and Santa
Clara counties, add $10,000 to each column; for couples in
Los Angeles County, add $8,000 to each figure.
Assembly votes
Floor 53-21
Appropriations 12-5
Aging and Long Term Care 5-1
Arguments in support
Supporters believe that the elder economic security
standard provides a framework to help guide public,
private, and elders' decisions. Cost data can be inserted
into the model for specific geographic areas to determine
the minimum standard for that area. In this way, the tool
may be adapted for individual planning purposes and used as
a targeted tool for state and local policy makers,
community agencies, and advocates. In addition, supporters
believe that using the index in preparing area agency plans
will enable the state and federal governments to have a
more complete and accurate picture of the numbers of
elderly people who lack the basic income needed to make
ends meet - and the extent of those income shortfalls.
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Arguments in opposition
The California Department of Aging opposes the bill because
it states that it cannot absorb the cost of implementation.
The department also points out that the bill could create
unrealistic service expectations at a time when there is
little ability to increase service levels.
COMMENTS AND QUESTIONS
Too much at once? Is a pilot program more appropriate?
According to the Gerontology Institute at the University of
Massachusetts, where the index was developed, the index is
in its early years; its first use was in the Boston area in
2006. No state Legislature has yet adopted the index as a
principle or secondary planning tool for services to aged
residents. Is statewide adoption of this index
appropriate, or is a pilot test of the index in several
planning and service areas a more appropriate course? A
pilot program over a period of five years could test the
validity and reliability of the index, and it could provide
the Legislature with information to compare service plans
as well as to compare changes in service delivery that
would result from the use of the index.
Data reporting by county or by planning and service area?
One technical issue: the bill requires the department and
area agencies to gather and report data at the county
level. This may be problematic for Los Angeles County,
which has two planning and services areas, and for 36
counties that are part of multiple-county planning and
service areas. If the use of the index remains statewide,
as proposed, should the bill be amended to require the
collection and aggregation of data by area agency rather
than by county?
Linkages project
The linkages project is a referral-for-services program
operated in each planning and service area. Services are
provided with no reference to the client's income. Is it
necessary to require area agencies to revise the linkages
program intake form annually if linkage services are
provided regardless of economic status?
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POSITIONS
Support: Insight Center for Community and Economic
Development (sponsor)
Women's Foundation of California (sponsor
California Senior Legislature (sponsor)
California Alliance for Retired Americans
(sponsor)
Catholic Charities of California (sponsor)
National Association of Social Workers,
California Chapter (sponsor)
AARP
Asian Pacific American Legal Center
Asian and Pacific Islander Older Adults Task
Force
Asian Pacific Health Care Venture
Beth Eden Housing
California Association of Area Agencies on Aging
California Advocates for Nursing Home Reform
California Commission on Aging
California Welfare Directors Association
Cambrian Center
Chinatown Service Center
Christian Church Homes
City and County of San Francisco
City of San Leandro
Community Living Campaign
Congress of California Seniors
Consumer Action
East Bay Asian Local Development Corporation
Ecumenical Peace Institute
Friendly Visiting Program, Alameda County
Irene Cooper Terrace Senior Housing
Japanese American Citizens League
Jewish Family Services of Los Angeles
J.L. Richard Terrace
Keller Plaza Apartments
Korean Churches for Community Development
LifeLong Medical Care
Little Tokyo Service Center
Live Oak Adult Day Services
Older Women's League of California
ONEgeneration
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Partners in Care Foundation
Planning and Service Area 2 Area Agency on Aging
Professional Fiduciary Association of California
Rebuilding Together Oakland
Salud Para La Gente-Elderday
Satellite Housing, Inc.
Senior Housing Solutions
Senior Services Coalition of Alameda County
St. Mary's Center
The Utility Reform Network
Time for Change Foundation
Visiting Angels, East Bay
Westlake Christian Terrace
Wider Opportunities for Women
Yu-Ai Kai/Japanese American Community Senior
Service
15 Individuals
Oppose:California Department of Aging
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