BILL ANALYSIS
SENATE HUMAN
SERVICES COMMITTEE
Senator Carol Liu, Chair
BILL NO: AB 2114
A
AUTHOR: Beall
B
VERSION: April 22, 2010
HEARING DATE: June 22, 2010
2
FISCAL: Appropriations
1
1
CONSULTANT:
4
Park
SUBJECT
Aging: Elder Economic Security Standard Index
SUMMARY
Requires the California Department of Aging (CDA) and Area
Agencies on Aging (AAAs) to utilize the Elder Economic
Security Standard Index (Elder Index) in their service
planning.
ABSTRACT
Existing federal law:
1.Establishes the federal Older Americans Act (OAA), which
provides a national network of state units on aging and
AAAs to deliver home and community-based programs for
older adults. Programs include nutrition,
transportation, information and assistance, elder abuse
prevention, and caregiver support.
2.Establishes, under the federal OAA, the Senior Community
Service Employment Program, to provide low-income seniors
with useful work experience at community service
Continued---
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
2
agencies, and increase economic self-sufficiency and
placement into unsubsidized employment.
3.Requires the Secretary of the Department of Health and
Human Services to update, at least annually, the poverty
guidelines, which shall be used as an eligibility
criterion for federal programs, as specified.
Existing state law:
1.Establishes the Older Californians Act, which provides
state-funded programs and services for older adults and
people with disabilities.
2.Establishes CDA as the state unit on aging to administer
a broad range of home and community-based programs and
provide leadership to the AAAs in developing systems of
home and community-based services that maintain
individuals in their own homes or least restrictive
homelike environments. Requires CDA 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.
3.Establishes the AAAs as the entities that provide for
and/or deliver services under the OAA, the Older
Californians Act, and other funding sources at the local
level. Requires each AAA to create a plan that considers
available data and population trends, assesses the needs
for services reflective of the community needs,
identifies sources of funding for those services, and
develops and implements a plan for the delivery of those
services based on the community's needs.
4.Requires AAAs, in fulfilling their mission, to 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, and those in
danger of losing their independence.
5.Requires CDA to develop a state plan on aging according
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
3
to federal law, which requires a state plan to be
submitted to the federal Administration on Aging every
four years, based upon the local area plans.
This bill:
1.Defines the Elder Index as an index, available on the
Internet, that quantifies the costs that elders face in
meeting their basic needs, including, but not limited to,
food, shelter, health care, transportation, utilities,
and essential household items, in the private market.
Specifies that it is updated by the University of
California, Los Angeles Center for Health Policy
Research, using publicly available data sources on the
costs to live in each county of the state.
2.Requires CDA to report the elder index data for each
service area in its state plan, if the elder index is
updated and made available to CDA.
3.Requires each area plan developed by an AAA to use the
elder index and specify the costs of meeting basic needs
for elders in each planning and service area (PSA) and
identify which elders are living at or below the elder
index, if the elder index is updated and made available
to the AAA.
4.Requires AAAs to use the elder index to track the
progress of participants in the state-administered Senior
Community Service Employment Program (SCSEP), if the
elder index is updated and made available to the AAA.
5.Establishes, through the provisions above, the Elder
Economic Dignity Act of 2010, and specifies that nothing
in the act shall be construed to mandate changes in the
current funding allocations to AAAs or, based on the use
of the elder index, affect means-tested programs
administered through the Mello-Granlund Older
Californians Act.
FISCAL IMPACT
According to the Assembly Appropriations Committee, no
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
4
direct fiscal impact to CDA to administer the elder index
if the data and analysis is provided by the UCLA Center for
Health Policy Research. The analysis also notes unknown,
likely minor administrative savings to AAAs to the extent
that use of the elder index reduces duplicative planning
efforts and increases the reliability of quantitative
analyses of local information.
BACKGROUND AND DISCUSSION
Author's statement
The author states that California's elder population is
underestimated and poorly planned for largely because
federal law requires the state to measure senior economic
health using an old and inaccurate tool (the federal
poverty level, or FPL). The author notes that the FPL is a
50-year-old measure based solely on the cost of food, and
does not account for California's wide range in cost of
living-from lower-cost Modoc County to higher-cost Los
Angeles. The author states that, as a result of using FPL,
agencies perform costly and inefficient research to
determine the true cost of living in their geographic area,
with no consistent standard across the state.
The author asserts that the elder index reflects whether a
senior owns or rents his or her home and the cost of
transportation, health care, and out-of-pocket expenses.
Because it is calculated for each county in California, the
author believes the elder index presents a more accurate
picture of a California senior's basic needs. The author
believes that because the federal government has not
replaced the FPL, important programs suffer from
inaccuracies, which lead to inefficient allocation of very
scarce public dollars. The author notes that, while the
federal movement to update the FPL with a supplemental
index is underway, California will benefit from using the
elder index. The author notes that New York City
implemented a new poverty measure in 2008.
Federal poverty guidelines and the elder index
Policymakers typically measure poverty and determine
benefits eligibility by using the federal poverty
guidelines (FPG), a 1963 measure based solely on the cost
of an economy food diet. Although the FPG (sometimes
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
5
loosely referred to as FPL) is updated annually using the
consumer price index, the current FPG is the same dollar
amount ($10,830 for an individual living alone) whether one
lives in a high-cost or a low-cost region.
The elder index is based on the actual cost in each county
of the basic expenses needed by older adults to age
independently with dignity in their own homes. Those with
incomes below the elder index are considered economically
insecure. The elder index methodology was developed by the
Gerontology Institute at UMass-Boston and Wider
Opportunities for Women, and refined and adapted to
California by the UCLA Center for Health Policy Research.
It 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 elder index, in California, the FPG covers
less than half of the basic costs experienced by older
adults. According to a brief published by UCLA Center for
Health Policy Research, in collaboration with the Insight
Center, 495,000 older Californians living alone in 2007
could not make ends meet - lacking sufficient income to pay
for a minimum level of housing, food, health care,
transportation and other basic expenses. The elder index
and related research show that, in addition to urban and
coastal areas, older adults in rural counties face
significant economic challenges as well. For example,
Imperial County has the highest percentage of single older
adults with incomes below the elder index benchmark (67.1
percent), while San Francisco County has the next highest
percentage, with 61.3 percent of older adults living alone
with incomes below the elder index.
Local and state plans on aging
California has 33 AAAs that provide a wide range of
services designed to keep older adults and adults with
disabilities independent and living in their own homes and
communities. To ensure that programs and services funded
by the AAA adequately serve the older adults within each
community, AAAs are required to conduct a needs assessment
every four years to document the service needs of community
residents and any gaps in the service network. The needs
assessment process typically includes a community-wide
survey, community meetings, and information received from
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
6
stakeholders and key informants. California Code of
Regulations (Title 22, Division 1.8, Chapter 3, Article 3)
requires that each needs assessment include all of the
following: the target populations, the types of existing
and potential needs of older individuals in the community,
the services or resources that currently are available, as
well as any constraints (waiting lists, geographic
limitations, quality), an estimate of unmet needs or
barriers to access, demographic information, and data from
other agencies. The information received through the needs
assessment process guides the AAA in identifying the
service priorities for the area plan.
Every four years, CDA is required by federal law to submit
a state plan on aging to the federal Administration on
Aging. When approved, CDA receives federal funds to
administer the state plan. Beyond the minimum required
information, California's 2009-2013 state plan on aging
addresses key socio-demographic factors that will shape
funding needs and priorities, unmet needs and promising
practices identified by CDA and the AAAs, and CDA's
objectives in working with the AAAs to provide
cost-effective, high quality services to California's older
adults and their informal caregivers.
Programs and services administered by CDA and the AAAs do
not require means-testing for eligibility; however, the OAA
requires preference to 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, CDA and AAAs track data,
including poverty data, on the number of older adults and
people with disabilities within a given PSA, but enrollment
in programs is not restricted to those who fall below a
certain threshold, with the exception of programs that use
Medi-Cal funds.
Senior Community Service Employment Program
According to the CDA web site, the SCSEP provides part-time
work-based training opportunities at local community
service agencies for older workers who have poor employment
prospects and assists with the transition of individuals to
private or other employment opportunities in the community.
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
7
The program provides a variety of supportive services to
the individual such as personal and job-related counseling,
job training, and job referral. Individuals who
participate in the program must be residents of California,
be at least 55 years of age, and have an income that does
not exceed 125 percent of the federal poverty level ($1,083
per month/$13,000 annual). Some income sources may be
excluded, and other factors may affect an individual's
eligibility. The SCSEP is available through 17 of the 33
AAAs and eight national organizations.
Arguments in support
The California Association of Area Agencies on Aging, AARP,
Aging Services of California, the Older Women's League of
California, and a host of other organizations, contend that
the elder index sets a new benchmark of income adequacy for
older adults. Supporters state that the elder index
provides a more accurate and localized measurement tool to
determine the cost of meeting basic needs and maintaining
independence in the community. By institutionalizing this
tool, supporters believe that AB 2114 will empower
policymakers to allocate limited resources more
effectively, and prepare for the needs of seniors and aging
baby boomers. Supporters believe that the elder index will
also help adults of any age make informed decisions about
when and where to retire, how much to save, and whether to
continue to work after retirement.
Arguments in opposition
The California Department of Aging (CDA) writes that
legislation is not required to meet the stated objectives
of the bill, as CDA and AAAs can already use the elder
index for planning purposes. CDA also believes that the
requirement for AAAs to use the elder index to track SCSEP
participants' progress is duplicative of existing measures
established by the federal Department of Labor. CDA also
writes that the bill may dramatically increase the number
of clients eligible for referral to programs, given the
significant discrepancy between the proportion of older
Californians determined to be in economic need when using
the elder index (50 percent) versus those determined to be
in economic need when using the federal poverty thresholds
(nine percent). CDA states that the bill does not ensure
that individuals would be eligible to receive these
services under federal statutory eligibility criteria or
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
8
that existing programs would be able to serve additional
clients, and could create unrealistic service expectations.
CDA believes that the appropriate discussion for
implementing the elder index is at the federal level, where
there is already movement toward using a supplemental
poverty measure. CDA writes that postponing state
implementation until federal measures change would
alleviate potential confusion arising from having different
poverty measures at the state an d federal level.
Related/prior legislation
AB 324 (Beall) of 2009 was substantially similar to this
bill in requiring CDA and AAAs to utilize the elder index
in their service planning. Vetoed by the Governor.
The Governor's veto message stated:
While I appreciate the author and sponsors' interest
in better refining their
planning and service levels for the seniors in their
communities, this bill is
unnecessary. Local agencies can already use the
specific index defined by
this bill in their planning efforts. Furthermore,
this bill would create
General Fund cost pressures at a time when there is
no ability to increase
service levels.
PRIOR VOTES
Assembly Floor: 51 - 20
Assembly Appropriations: 12 - 5
Assembly Aging and
Long-Term Care: 4 - 1
COMMENTS
1.Minor and technical amendments.
a) Page 2, line 12: insert "biennially" after "updated"
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
9
5 9009. "Elder Economic Security Standard
Index" means an
6 index, available on the Internet, that
quantifies the costs that elders
7 face in meeting their basic needs, including,
but not limited to,
8 food, shelter, health care, transportation,
utilities, and essential
9 household items, in the private market. It is
derived by applying
10 the existing publicly available methodology,
developed byWider
11 Opportunities forWomen and the Gerontology
Institute at the
12 University of Massachusetts, Boston, to updated
biennially by the University
13 of California, Los Angeles Center for Health
Policy Research,
14 using publicly available data sources on the
costs to live in each
15 county of the state.
b) Page 4, line 13: strike comma and insert "to"; page 4,
line 14: strike "which elders are" and insert "the number
or percent of elders who are"
12 (2) Each plan shall use the Elder Economic
Security Standard
13 Index , to specify the costs of meeting basic
needs for elders in each
14 planning and service area, and identify which
elders are the number or percent of elders who are
living at
15 or below the Elder Economic Security Standard
Index. The
16 requirements of this paragraph shall be
implemented only if the
17 Elder Economic Security Standard Index is
updated and made
18 available to the area agencies on aging.
c) Page 5, line 27: strike "and"
25 (h) The area agencies on aging shall use the
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
10
Elder Economic
26 Security Standard Index to track the progress of
participants in the
27 state-administered Senior and Community Service
Employment
28 Program. The requirements of this subdivision
shall only be
29 implemented if the Elder Economic Security
Standard Index is
30 updated and made available to the area agencies
on aging.
2.Senior Community Service Employment Program. While this
bill requires AAAs to use the elder index to track
participant progress and outcomes in the SCSEP, it does
not require programs operated by national organizations
to do so for SCSEP.
POSITIONS
Support: AARP California (co-sponsor)
California Senior Leaders Alliance (co-sponsor)
Catholic Charities of CA United (co-sponsor)
Insight Center (co-sponsor)
Jewish Family Services of Los Angeles
(co-sponsor)
National Association of Social Workers
(co-sponsor)
Women's Foundation of CA (co-sponsor)
Aging Services Collaborative of Santa Clara
County
Aging Services of California
Amador County Commission on Aging
At Your Home FamilyCare
California Advocates for Nursing Home Reform
California Alliance for Retired Americans
California Association of Area Agencies on Aging
California Association of Public Authorities for
IHSS
California Commission on Aging
California Commission on the Status of Women
California Communities United Institute
California Health Collaborative
California Senior Leaders
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
11
California Senior Legislature
California Women's Agenda
Catholic Charities of California United
Center for Technology and Aging
Chicano Federation of San Diego County, Inc.
City and County of San Francisco
Commission on Aging
Community Living Campaign
Contra Costa County, Board of Supervisors
County Welfare Directors Association
County of Santa Clara, Board of Supervisors
ElderHelp of San Diego
Gray Panthers Sacramento
Health Trust
HIP Housing
In-Home Supportive Services Consortium of San
Francisco
Institute for Health and Aging, University of
California, San Francisco
Islamic Shura Council of Southern California
Jericho
Lavender Seniors of the East Bay
Los Angeles Area Chamber of Commerce
Meals-on-Wheels Greater San Diego, Inc.
Multi-Purpose Senior Services Program Association
National Senior Citizens Law Center
Neighborhood House Association
Older Women's League of California
On Lok Inc.
ONEgeneration
Openhouse
Partners in Care Foundation
Professional Fiduciary Association of California
Rehabilitation Services of Northern California
San Diego East County Action Network
San Francisco Gray Panthers
Santa Clara County, Board of Supervisors
SCAN Healthplan
Senior Community Centers
Senior Services Coalition of Alameda County
Seniors Council (Area Agency on Aging of Santa
Cruz and San Benito Counties)
South Asian Network
St. Mary's Center
St. Paul's Senior Homes & Services
STAFF ANALYSIS OF ASSEMBLY BILL 2114 (Beall) Page
12
State of California, California Senior
Legislature
State of California, Commission on the Status of
Women
U.C. Berkeley Center on Aging
Wider Opportunities for Women
Women's Foundation of California
36 individuals
Oppose:California Department of Aging
-- END --