BILL ANALYSIS
AB 1606
Page 1
Date of Hearing: April 20, 2010
ASSEMBLY COMMITTEE ON HEALTH
William Monning, Chair
AB 1606 (Coto) - As Amended: March 23, 2010
SUBJECT : Medi-Cal: department-approved chronic disease
self-management programs.
SUMMARY : Requires the Department of Health Care Services (DHCS)
to allow services provided through DHCS-approved Chronic Disease
Self-Management Program (CDSMP) to be reimbursable under
Medi-Cal. Specifically, this bill :
1)Defines DHCS-approved CDSMP as a program approved by DHCS that
has been tested through randomized controlled trials and
satisfies the following conditions:
a) Proven effectiveness at improving or maintaining the
health status of people with chronic disease;
b) Demonstrated suitability for implementation, including
through community-based services organizations and is ready
for broad national distribution;
c) Uses non-clinical workers or volunteers; and,
d) Results of randomized controlled trials have been
published in a peer-reviewed scientific journal.
2)Requires DHCS to seek all federal waivers necessary to
implement this program and to consider including reimbursement
under the renewal or replacement of the existing Section
1115(a) waiver (The Medi-Cal Hospital/Uninsured Care
Demonstration Project Act, commonly known as the hospital
waiver) or the waiver for the Multipurpose Senior Services
Program (MSSP).
EXISTING LAW :
1)Establishes Medi-Cal, administered by DHCS, to provide
comprehensive health care services and long-term care to
pregnant women, children, and people who are aged, blind, and
disabled.
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2)Federal law requires benefits to be offered to all
beneficiaries in a comparable fashion and each beneficiary
must have a choice of provider, but authorizes states to apply
for waivers.
3)Requires DHCS to apply for a waiver of federal law to test the
efficacy of providing a disease management benefit to Medi-Cal
beneficiaries. This waiver is known as the Disease Management
Waiver.
4)Requires DHCS to apply to CMS for a waiver or demonstration
project to replace the current Medi-Cal Hospital/Uninsured
Care Demonstration Project and requires the waiver or
demonstration project to include proposals to restructure the
organization and delivery of services to be more responsive to
the health care needs of Medi-Cal enrollees for the purpose of
providing the most vulnerable Medi-Cal beneficiaries with
access to better coordinated and integrated care.
FISCAL EFFECT : This bill has not been analyzed by a fiscal
committee.
COMMENTS :
1)PURPOSE OF THIS BILL . According to the author, the purpose of
this bill is to help low income Californians on Medi-Cal
suffering from a chronic disease improve their health and
lower their health care costs, by offering an approved CDSMP
as a covered benefit. The author asserts that Californians
suffering from one or more chronic diseases, a large number of
them seniors, are among the most costly recipients of
health-care services, often requiring multiple
hospitalizations and significant out-patient assistance. The
author further states that research has shown that those who
enroll in and complete an evidence-based chronic disease self
management program have demonstrated an ability to self-manage
their chronic conditions in ways that significantly improve
the quality of their lives and greatly reduce their health
care costs.
2)BACKGROUND . Medi-Cal provides coverage to nearly 7.3 million
Californians, roughly half of whom are enrolled in fee for
service and the other half in Medi-Cal managed care through
both public and private health plans. According to DHCS data,
as of January 2010, 1.5 million Medi-Cal beneficiaries are
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Seniors or People with Disabilities (SPD). Of those,
Medi-Cal-only disabled adults number 360,000. An additional
1.1 million are Dual Medi-Cal /Medicare eligible. SPDs have
the greatest health care needs of any eligibility group served
by Medi-Cal and account for the highest per capita spending in
Medi-Cal. Almost 70% of SPDs have two or more chronic
conditions, and almost 25% of the population has four or more
chronic conditions. In addition, over 16% of beneficiaries
with disabilities have diabetes, compared to 7% for the U.S.
population overall. Approximately 30% of Medi-Cal
beneficiaries with disabilities have received treatment
throughout the year for a mental health condition.
The FFS program accounts for 82% of the costs in Medi-Cal.
Seniors and non-elderly adults with disabilities account for
25% of Medi-Cal beneficiaries but 62% of the expenditures.
The average annual cost in Medi-Cal for SPDs is $8,700 per
year. According to DHCS, 10% of Medi-Cal beneficiaries
account for 74% of the costs of the total program.
3) MEDICAID WAIVERS . In order for a state to modify its
Medicaid program, approval from the federal government is
required. Specifically, when a state wants to make
significant changes to its Medicaid program, it must take one
of two steps: either a) amend its State Medicaid Plan-the
state's contract with the federal government (SPA); or b)
receive an exemption or "Medicaid waiver" from portions of
Title XIX of the Social Security Act by the U.S. Department of
Health and Human Services (DHHS).
The route a state must take depends upon the type of changes
it seeks to make to its Medicaid program. If proposed changes
are in alignment with existing federal Medicaid law, a state
can change the program by filing a SPA with the Centers for
Medicaid and Medicare Services (CMS). If the state proposes
to change its program in a way that does not meet existing
law, a federal waiver is required in order for the state to
continue receiving federal matching funds for its Medicaid
program.
4)EXISTING RELEVANT WAIVERS . California currently has sixteen
waivers. Two of these waivers are of particular relevance to
this bill.
a) Section 1115 Demonstration Waiver or Medi-Cal
Hospital/Uninsured Care . This bill requires DHCS to
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consider reimbursement for CDSMP services as part of the
Section 1115 Waiver to replace the existing Medi-Cal
Hospital Waiver. Under this waiver, hospital financing was
fundamentally restructured. The non-federal share of
Medi-Cal funds for 22 county and University of California
hospitals known as Designated Public Hospitals was shifted
from State General Funds to certified public expenditures
(CPEs). The waiver also created the Safety Net Care Pool
(SNCP) to pay for services to the uninsured and for
unreimbursed Medi-Cal expenditures delivered through public
hospitals, other governmental entities, and state-funded
programs In addition, CMS set aside a portion of the SNCP
funding contingent on a Medi-Cal expansion of mandatory
enrollment in managed care to SPDs. Except for County
Organized Health Systems, this provision of the waiver was
never enacted. The waiver expires on August 31, 2010.
Enacted as part of the 2009-10 State budget, AB 6 X4 (Evans),
Chapter 6, Statutes of 2009-10 Fourth Extraordinary Session
requires the state to apply for a new waiver to be approved
no later than the conclusion of the current 1115 hospital
waiver. As mandated by AB 6 X4, the State of California
has prepared a concept paper to submit to CMS requesting a
Comprehensive Section 1115 waiver to replace the current
Medi-Cal hospital waiver. A stakeholder process is ongoing
and has been meeting since January 2010.
b) Disease Management Waiver . The health budget trailer
bill of 2003 (AB 1762 (Committee on Budget), Chapter 230,
Statutes of 2003) established the Disease Management Waiver
to test the effectiveness of providing a Medi-Cal disease
management benefit. Eligibility for the Disease Management
Waiver is limited to those persons who are eligible for the
Medi-Cal Program as SPDs, or those persons over 21 years of
age who are not enrolled in a Medi-Cal managed care plan,
or are ineligible for Medicare, and who are determined by
the DHCS to be at risk of, or diagnosed with, select
chronic diseases, including, but not limited to, advanced
atherosclerotic disease syndromes, congestive heart
failure, and diabetes.
DHCS contracts with one vendor to operate a disease
management program for Medi-Cal beneficiaries. McKesson
Health Solutions provides disease management services in
Alameda County (3,668 enrollees as of February 11, 2010)
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and slightly over 120 zip codes in Los Angeles County
(15,376 enrollees as of February 11, 2010) under a
three-year $4 million per year contract. The McKesson
contract is in its third year of operation.
Existing law requires DHCS to evaluate the effectiveness of
the Disease Management Waiver, and DHCS has contracted with
the UCLA Center for Health Policy Research to evaluate the
following outcomes as compared to a control group in eight
non-pilot counties:
i) Provision of services as a cost neutral or cost
savings benefit;
ii) Improved health outcomes;
iii) Provider satisfaction, effectiveness of community
case workers, nurse triage line, and an outbound calling
system; and,
iv) Vendor collected scores of a diabetic measure,
access to medications and a measurement used to compare
health plan performance.
The first year results from the UCLA evaluation were
expected in July 2009, but have not yet been released.
5)CHRONIC DISEASE MANAGEMENT . Disease management is used to
describe a wide range of approaches designed to identify
patients with potentially costly health conditions and
encourage adherence to recommended treatment plans and
self-care strategies. Traditional disease management programs
focus on a defined population of members with a specific
health condition such as diabetes or asthma.
6)CHRONIC DISEASE SELF-MANAGEMENT . CDSMP is a community-based
patient self-management education course. It relies on the
assumption that patients with different chronic diseases have
similar self-management problems and disease related tasks,
patients can learn to take responsibility for the day-to-day
management of their diseases and confident, knowledgeable
patients practicing self-management will experience improved
health status and will utilize fewer health care resources.
CDSMP has been developed through over 20 years of federally
funded grants from the National Institutes on Health, The U.S.
Agency for Healthcare Research and Quality, and the Centers
for Disease Control and Prevention (CDC). The model is the
Stanford University CDSMP. It is a train the trainer program.
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Lay leaders are trained to deliver a six week course.
According to the sponsors, the course is currently offered at
172 locations statewide. There are nearly 100 master
trainers, people able to train new trainers, who will in turn
lead the course in a community setting.
a) Outcomes . The sponsors are relying on a number of
studies that evaluate use of CDSMP. A review of these
studies was published jointly by researchers from CDC and
the National Council on Aging in 2008, entitled "Review of
Findings on CDSMP outcomes: Physical, Emotional &
Health-Related Quality of Life, Healthcare Utilization and
Costs" (2008 Review). According to this 2008 Review,
there is strong evidence across studies that CDSMP has a
beneficial effect on physical and emotional outcomes and
health-related quality of life. The 2008 Review reports
that the program consistently results in greater
energy/reduced fatigue, more exercise, fewer social role
limitations, better psychological well-being, enhanced
partnerships with physicians, improved health status, and
greater self-efficacy. It is generally (although not
always) associated with reductions in pain symptoms.
According to the 2009 review, this approach was found to be
effective across a variety of chronic diseases and obviates
the need for many different disease-specific classes with
the accompanying recruitment and scheduling problems. The
2008 Review found:
i) Utilization . Although the measurement approaches
differed across studies, the 2008 Review concluded that
CDMSP results in reductions of healthcare expenditures,
including fewer emergency room (ER) visits, fewer
hospitalizations and more appropriate utilization of
healthcare resources, addressing healthcare needs in
outpatient settings rather than ER visits and
hospitalizations.
ii) Socioeconomic and education levels . The 2008 Review
concludes that the program has demonstrated benefits
across the spectrum. Two domestic studies targeted
Spanish-speaking Hispanics and CDSMP is offered in many
other countries including China and Japan.
iii) Progressive diseases . Even though participants may
experience worsening of disability over time, health care
utilizations did not increase. CDSMP participants
maintain the health and behavioral benefit and
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significant improvements in exercise and social/role
limitations were seen over a two-year period.
b) Future and Viability of CDSMP . The 2008 Review reports
that the CDC is working in partnership with the National
Council on Aging on the issue of financial sustainability
for evidence-based health programs for older adults. On
March 30, 2010, Secretary Sibelius announced that $27
million in grants had been awarded by DHHS to The
Communities Putting Prevention to Work Chronic Disease
Self-Management Program, funded by the American Recovery
and Reinvestment Act of 2009 (ARRA). According to the
announcement, this will allow 45 states, Puerto Rico and
the District of Columbia to provide self-management
programs to older adults with chronic diseases build
statewide delivery systems and develop the workforce that
delivers these programs. California has been allocated $1
million.
Two federal evaluation activities will complement required
state reporting. Additionally, AoA will collaborate with
CMS to develop a pilot test in one state as a quality
assurance process that will track Medicare claims data of
chronic disease self-management program participants and
Medicare beneficiaries not participating in the program.
Data from all these sources will be used to assess the
impact of this ARRA program on participant health
behaviors, health status, health care utilization and
health care costs
7)SUPPORT . The sponsor, The Health Trust, writes in support
that they provide a program called the "The Road to Healthier
Living" which is based on the Stanford CDSMP model. They
report, that after two years into the program, they have
discovered great success with the CDSMP model. According to
the sponsor, early data shows a clear increase in one's
self-efficacy to manage chronic conditions, and decrease in
the severity of fatigue, significant increase in the frequency
with which they communicate with their doctors about their
health concerns; and, a decrease in health distress due to
their chronic condition. In support the Latino Coalition for
a Healthy California (LCHC) writes that this bill would
require Medi-Cal to cover approved, evidence based and
research test, CDSMPs. LCHC further states that numerous peer
reviewed studies demonstrate that evidence based programs like
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this one help patients manage their own chronic illness and
improve their own health and well-being.
8)RELATED LEGISLATION
a) AB 342 (Bass) requires DHCS to submit a waiver request
to implement a demonstration project to improve Medi-Cal
and conditions the waiver upon subsequent statutory
enactment. AB 342 is pending in the Senate Health
Committee
b) SB 208 (Steinberg and Alquist), is identical to AB 342.
SB 208 is pending in the Assembly Health Committee
c) AB 2787 (Committee on Health) requires DHCS to provide
an evaluation of the Disease Management Waiver program by
January 1, 2011 and to include recommendations for
modifications that should be made prior to a statewide
implementation. This bill is set for hearing in the
Assembly Health Committee on April 20, 2010.
9)PRIOR LEGISLATION .
a) AB 6 X4 (Evans) requires the state to apply for a new
waiver to be approved no later than the conclusion of the
current 1115 hospital waiver and requires the waiver or
demonstration project to include proposals to restructure
the organizations and delivery of services to be more
responsive to the health care needs of Medi-Cal enrollees
for the purpose of providing the most vulnerable Medi-Cal
beneficiaries with access to better coordinated and
integrated care.
b) SB 1100 (Perata), Chapter 560, Statutes of 2005, enacts
the restructuring of hospital financing and other statutory
changes necessary to implement the Section 1115 Hospital
Waiver.
c) AB 1762 (Committee on Budget), Chapter 230, Statutes of
2003, established the Disease Management Waiver to test the
effectiveness of providing a Medi-Cal disease management
benefit.
10)POLICY ISSUE . This bill proposes to add a new benefit to the
Medi-Cal program. The sponsors assert that CDSMP is cost
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effective because it reduces hospitalizations. The 2009
budget eliminated Medi-Cal adult dental services, restricted
Adult Day Health Care Services (ADHC) and reduced In-Home
Support Services (IHSS). The Governor is proposing, for the
2010 budget, the elimination of full-scope Medi-Cal services
for certain legal immigrants, the elimination of ADHC and
further reductions in IHSS and other benefits. These benefits
also have demonstrated a cost benefit by preventing
hospitalization and institutionalizations. Furthermore, DHHS
has just announced $1 million in grants for the CDSMP through
the Medicare program and calls for an evaluation. Under these
circumstances, is it a priority to add CDMSP as a Medi-Cal
benefit at this time?
11)PROPOSED AMENDMENTS . To further the intent of the author and
sponsor and to make this bill consistent with the Section 1115
Hospital/Uninsured Waiver, the author is intending to amend
this bill as follows: (amendments in bold and underlined).
SECTION 1. Section 14132.07 is added to the Welfare and
Institutions Code, to read:
14132.07. (a) (1 )For purposes of this section, a
"department-approved chronic disease self-management program"
means a chronic disease self-management program approved by the
department that has been tested through randomized controlled
trials and satisfies the following conditions:
(A) (1 ) Has been shown to be effective at improving or
maintaining the health status of people over the age of 18 with
chronic disease.
(B) (2 )Has been shown to be suitable for implementation,
including implementation through community-based services
organizations, and is ready for broad national distribution
through those organizations.
(C)( 4 ) Any results from the randomized controlled trials done on
the chronic disease self-management program have been published
in a peer-reviewed scientific journal.
(D) Courses provided through the chronic disease self-management
program are affiliated with a licensed Medi-Cal provider that
will assume responsibility for billing, monitoring quality of
service and ensuring cultural competency.
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(2 ) (3) Nonclinical workers or volunteers are utilized in the
delivery of the services provided by the chronic disease
self-management program.
(3) Services provided by a department-approved chronic disease
self-management program may be provided through the Internet.
Internet delivery of department-approves chronic disease
self-management program services is particularly appropriate for
homebound and disable individual.
(b)(1) The department shall include reimbursement under the
Medi-cal program for services provided through the chronic
disease self-management program as part of the restructuring
proposal described in subdivision (b) of Section 14180.
(2) If the department includes better care coordination, as
describe in paragraph (1) of subdivision (b) of Section 14180,
as part of the restructuring proposal required by subdivision
(b) of Section 14180, the department shall implement paragraph
(1) as part of its implementation of paragraph (1) of
subdivision (b) of Section 14180.
seek approval for, and if obtained, implement, all federal
waivers necessary to allow the services provided to Medi-Cal
beneficiaries through a department-approved chronic disease
self-management program to be reimbursable under the Medi-Cal
program.
(2) In implementing paragraph (1), the department shall consider
including reimbursement for services provided through
department-approved chronic disease self-management programs as
part of the waiver under Section 1115 of the federal Social
Security Act (42 U.S.C. Sec. 1315) to replace the current
Medi-Cal Hospital/Uninsured Care Demonstration Project or as
part of the waiver for the Multipurpose Senior Services Program,
or both.
REGISTERED SUPPORT / OPPOSITION :
Support
The Health Trust (sponsor)
Aging Services Collaborative
California Association of Physicians Groups
California Primary Care Association
Catholic Healthcare West
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Community Health Partnership
Conard House Administrative Offices
GlaxoSmithKline Catholic Healthcare West
Health Access California
Latino Coalition for a Healthy California
National Council on Aging
Partners in Care Foundation
Santa Clara Valley Medical Center
Scan Health Plan
Sonoma County Area Agency on Aging
Working Partnerships USA
Opposition
None on file.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097