BILL ANALYSIS
------------------------------------------------------------
|SENATE RULES COMMITTEE | AB 754|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
------------------------------------------------------------
THIRD READING
Bill No: AB 754
Author: Chesbro (D)
Amended: 9/4/09 in Senate
Vote: 21
SENATE HEALTH COMMITTEE : 10-0, 7/15/09
AYES: Alquist, Strickland, Aanestad, Cedillo, Cox,
DeSaulnier, Leno, Negrete McLeod, Pavley, Wolk
NO VOTE RECORDED: Maldonado
SENATE APPROPRIATIONS COMMITTEE : 13-0, 8/27/09
AYES: Kehoe, Cox, Corbett, Denham, Hancock, Leno, Oropeza,
Price, Runner, Walters, Wolk, Wyland, Yee
ASSEMBLY FLOOR : 78-0, 6/2/09 - See last page for vote
SUBJECT : Medi-Cal: mental health plans
SOURCE : California Mental Health Directors Association
DIGEST : This bill requires the Department of Mental
Health (DMH) to allocate and distribute the full contracted
amount of General Fund payment for the managed mental
health care program, exclusive of the Early and Periodic
Screening Diagnosis, and Treatment Program specialty mental
health services provided under the Medi-Cal specialty
mental health services waiver, at the beginning of the
contract period. The allocated funds shall be considered
to be funds of the plan that may be held by DMH. DMH shall
develop a methodology to ensure that these funds are held
CONTINUED
AB 754
Page
2
as the property of the plan and shall not be reallocated by
DMH or any other entity of state government for other
purposes. This bill becomes operative on July 1, 2011.
Senate Floor Amendments of 9/4/09 require that the funds
for the managed mental health care program be allocated and
distributed by DMH, not just allocated.
ANALYSIS : Under current law, the Department of Health
Care Services (DHCS) administers the Medi-Cal program to
provide health benefits to low-income children; their
parents or caretaker relatives; pregnant women; elderly,
blind, or disabled persons; nursing home residents; and
refugees who meet specified eligibility criteria. Current
law also establishes DMH to direct and coordinate mental
health services in the state primarily through contracts
with county mental health agencies. Current law also
requires the state to pay properly submitted invoices
within 45 days, assuming certain conditions are met. This
time frame does not apply to Medi-Cal reimbursements,
except in certain circumstances.
This bill is sponsored by the County Mental Health
Directors Association. The Association contends that there
have been significant disruptions in service reimbursement
claims on the part of both DMH and DHCS in recent years and
that this bill will help increase the efficiency of mental
health services by enabling funds to flow to counties in a
more timely manner.
In 2007, the Department of Finance's Office of State Audits
and Evaluations released a report on the fiscal processes
DMH uses in the payment of local assistance claims. The
report confirmed that payments were not being made in a
timely manner. Problems identified in the report included
ineffective and decentralized program governance between
DMH and DHCS and information systems that are defective and
outdated.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 9/2/09)
AB 754
Page
3
County Mental Health Directors Association (source)
Butte County Behavioral Health Department
California State Association of Counties
County of San Diego
Glenn County Board of Supervisors
Humboldt County Board of Supervisors
Orange County Board of Supervisors
Regional Council of Rural Counties
Riverside County Department of Mental Health
Sacramento County Board of Supervisors
San Bernardino County Board of Supervisors
Santa Barbara County Board of Supervisors
ARGUMENTS IN SUPPORT : The author's office states that
over the last year, there have been significant disruptions
in the reimbursement of MHPs for Medi-Cal specialty mental
health services due to problems in communication,
accounting, and claims processing on the part of DMH and
DHCS. These disruptions have led to increased federal
scrutiny, multi-year county payment deficiencies and
approximately half a billion dollars in unreimbursed care
provided to Medi-Cal beneficiaries with severe mental
illness. The author's office also states that counties
currently pay for the full cost of Medi-Cal specialty
mental health services while awaiting reimbursement from
the state and federal government. This time frame can vary
from four to six months to two years. Counties often find
themselves in the position of borrowing funds to meet the
up-front costs and then incur associated interest costs
that are not eligible for state or federal reimbursement.
The author's office further states that, given the current
budget crisis, providing care without reimbursement has
become increasingly untenable for counties.
ASSEMBLY FLOOR :
AYES: Adams, Ammiano, Anderson, Arambula, Beall, Tom
Berryhill, Blakeslee, Blumenfield, Brownley, Buchanan,
Caballero, Charles Calderon, Carter, Chesbro, Conway,
Cook, Coto, Davis, De La Torre, De Leon, DeVore, Duvall,
Emmerson, Eng, Evans, Feuer, Fletcher, Fong, Fuentes,
Fuller, Furutani, Gaines, Galgiani, Garrick, Gilmore,
Hagman, Hall, Harkey, Hayashi, Hernandez, Hill, Huber,
AB 754
Page
4
Huffman, Jeffries, Jones, Knight, Krekorian, Lieu, Logue,
Bonnie Lowenthal, Ma, Mendoza, Miller, Monning, Nava,
Nestande, Niello, Nielsen, John A. Perez, V. Manuel
Perez, Portantino, Price, Ruskin, Salas, Saldana, Silva,
Skinner, Smyth, Solorio, Audra Strickland, Swanson,
Torlakson, Torres, Torrico, Tran, Villines, Yamada, Bass
NO VOTE RECORDED: Bill Berryhill, Block
DLW/JJA:mw 9/8/09 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****