BILL ANALYSIS
AB 369
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Date of Hearing: April 28, 2009
ASSEMBLY COMMITTEE ON HEALTH
Dave Jones, Chair
AB 369 (Yamada) - As Amended: April 13, 2009
SUBJECT : Adult day health care centers.
SUMMARY : Creates an exemption to the existing Medi-Cal
certification moratorium which will allow the opening of two
new, publicly financed Adult Day Health Centers (ADHCs).
Exempts from the current moratorium a state-owned and operated
property, for which planning began before 2002 that is funded by
state bonds and federal grants to serve California veterans.
EXISTING LAW :
1)Establishes the California ADHC Act which requires licensure
and regulation of ADHC centers with administrative
responsibility shared between the State Department of Public
Health (DPH), the California Department of Aging (CDA), and
the Department of Health Care Services (DHCS) pursuant to an
interagency agreement.
2)Requires ADHC centers to be licensed by DPH as health care
facilities and permits certification for Medi-Cal payments by
CDA.
3)Establishes DHCS as the principal agency to oversee Medi-Cal
policy, rates, audits, investigations, eligibility and
utilization.
4)Authorizes DPH to implement one year moratoriums on
certification and enrollment in the Medi-Cal Program of new
adult day health care centers on a statewide or regional basis
with certain statutory exceptions. These exceptions include:
a) Applicants for Programs of All-Inclusive Care for the
Elderly;
b) Applicants for organizations currently designated as
federally qualified health centers;
c) Applicants centrally located in counties with no other
certified ADHCs;
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d) Applicants serving discharged nursing home patients in
San Francisco;
e) Applicants requesting expansion or relocation within a
county with a specified ratio of persons over the age of 65
receiving Medi-Cal; and,
f) Applicants currently licensed and located in a county
whose population exceeds 9,000,000 serving a specified
population from a regional center.
FISCAL EFFECT : This bill has not yet been analyzed by a fiscal
committee.
COMMENTS :
1)PURPOSE OF THIS BILL . This bill, according to the sponsor,
the California Association for Adult Day Services (CAADS),
creates an exemption to the ADHC moratorium on Medi-Cal
certification to permit two ADHCs operated by the California
Department of Veterans Affairs (CDVA) to become eligible for
Medi-Cal reimbursement. CDVA is constructing two large
veteran's campuses, one in Ventura County and another in
Lancaster, which will include multi-level housing and medical
services intended to incorporate ADHC within their planned
care continuum. The availability of ADHC, notes the sponsor,
is a key component of these publicly funded operations, and
the Medi-Cal moratorium has had the unintended effect of
preventing ADHC services within the new facilities.
2)BACKGROUND . ADHC is an organized day program of therapeutic,
social, and health activities and services provided to elderly
persons with functional impairments, either physical or
mental, at risk of institutional placement. The sponsor notes
that ADHCs employ a multidisciplinary team approach providing
multiple services under one roof. These services include
skilled nursing care, physical therapy, social services,
meals, speech therapy, and socialization in order to reduce
the risk factors which could lead to placement into more
expensive care settings. California offers ADHC as an
optional Medi-Cal benefit to reduce utilization of nursing
homes, emergency rooms, and hospitals. According to CAADS
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roughly 42,000 Medi-Cal beneficiaries are now served by 350
ADHCs in this state.
3)ADHC MORITORIUM . The 2004-05 California State Budget
authorized the DHCS to impose a moratorium on the
certification of new ADHCs after August 2004. The moratorium
was implemented in response to the very rapid growth in ADHCs
in certain regions of the state and, according to this bill's
sponsor, because of reduced state staff resources available to
provide training and support for new providers. The
moratorium has been renewed every year since 2004. However,
the Legislature has, over the last five years, authorized
several exemptions to allow expansion of specific ADHC
operations. ADHC centers were initially required to be
nonprofit, charitable facilities until 1994 when legislation
(SB 1492 (Mello), Chapter 1121, Statutes of 1994) authorized
for-profit companies to develop ADHCs. In recent years the
number of centers has grown from 72 to nearly 350 stand alone
operations. This rapid growth brought higher state costs,
according to this committee's analysis of prior legislation,
and DHCS became increasingly concerned that some centers
provided only minimal services and failed to comply with state
requirements. In 2004, the federal Centers for Medicare and
Medicaid Services directed California to shift ADHC from an
optional Medi-Cal benefit to a home and community based waiver
program. The rapid growth, compliance concerns, and change in
structure led the Legislature to impose the moratorium.
4)VENTURA AND LANCASTER FACILITIES . In 2002, according to the
CDVA Web site, planning for three large veteran's facilities,
one in Ventura County, one in Lancaster, and one in West Los
Angeles, was initiated following passage of the Veterans Home
Bond Act of 2000 (AB 2559 (Wesson), Chapter 216, Statutes of
2002). The three facilities are financed with federal
veteran's home grants and state bond funding totaling $229
million, of which 60% is from federal sources. All three
sites are intended to provide multilevel housing and medical
services for eligible veterans. The two sites nearest
completion, Ventura and Lancaster, incorporate ADHC services
as well as assisted living and nursing care units within their
continuum of care design. CAADS indicates that both projects
had sought approval for up to 100 licensed ADHC slots, but
anticipate only 20 enrollees at each facility for the first
few years of operation. Absent this legislation, residents of
the two facilities will, according to the sponsor, be placed
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in the campus Medi-Cal nursing home with higher state costs
and less personal independence for the beneficiary.
5)SUPPORT . The California Alliance for Retired Americans writes
that this bill will improve the care of veteran's living on
campus by authorizing this limited Medi-Cal exemption.
Without access to these ADHCs, veterans living on the Ventura
and Lancaster campuses will be forced into more costly campus
nursing homes. This relocation would waste state funds by not
utilizing lower cost ADHC services and would pointlessly
diminish the quality of the veteran's lives.
6)PREVIOUS AND RELATED LEGISLATION .
AB 827 (Hancock) of 2008 would have exempted from the
moratorium ADHCs seeking a change of ownership, relocation, or
increase in capacity under specified conditions. AB 827 was
held in the Assembly Appropriations Committee.
SB 1103 (Committee on Budget and Fiscal Review), Chapter 228,
Statutes of 2004, gave authority to DHCS to impose a
moratorium on the certification of new ADHC providers
effective in August of 2004.
SB 428 (Perata), 2003, would have put in place a pre-licensure
review process, implemented a one year moratorium, and imposed
new licensing fees to fund the additional DPH workload.
REGISTERED SUPPORT / OPPOSITION :
Support
California Association of Adult Day Services (sponsor)
California Alliance for Retired Americans
Aging Services of California
Opposition
None on file.
Analysis Prepared by : John Miller / HEALTH / (916) 319-2097