BILL ANALYSIS
SB 117
Page 1
SENATE THIRD READING
SB 117 (Corbett)
As Amended June 1, 2009
Majority vote
SENATE VOTE :33-6
HEALTH 15-4 AGING 5-0
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|Ayes:|Jones, Adams, |Ayes:|Bonnie Lowenthal, Hagman, |
| |Blumenfield, | |Nestande, Torres, Yamada |
| | Block, Carter, De La | | |
| |Torre, e Leon, Hall, | | |
| |Hayashi, Hernandez, | | |
| |Bonnie Lowenthal, Nava, | | |
| | V. Manuel Perez, Salas, | | |
| |Audra Strickland | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Fletcher, Conway, | | |
| |Emmerson, Gaines | | |
| | | | |
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APPROPRIATIONS 12-5
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|Ayes:|De Leon, Ammiano, |
| |Charles Calderon, Coto, |
| |Davis, Fuentes, Hall, |
| |John A. Perez, Skinner, |
| |Solorio, Torlakson, Hill |
| | |
|-----+--------------------------|
|Nays:|Conway, Harkey, Miller, |
| |Nielsen, Audra Strickland |
| | |
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SUMMARY : Extends the deadline by which the Department of Health
Care Services (DHCS) is required to establish a new Medi-Cal
rate reimbursement methodology for adult day health care (ADHC)
services, from August 1, 2010 to August 1, 2012 and makes
conforming changes to other timeframes associated with the
establishment and implementation of the reimbursement
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methodology. Specifically, this bill:
1)Requires DHCS to produce a cost report for a core rate, a
methodology and documentation necessary to estimate the rates
for separately billed services and for transportation services
by 2010 (was 2007).
2)Requires DHCS to establish facility peer groupings in
consultation with the California Association of Adult Day
Services (CAADS), by 2011 (was 2008).
3)Requires DHCS to facilitate training of providers in
collaboration with CAADS on the use of the new methodologies
and documentation by 2011 (was 2008).
4)Requires DHCS to establish a preliminary estimate of a
reimbursement limit, the rates for individual services and the
rates for separately billed services by 2012 (was 2010),
including a comparison to the rate methodology in effect in
2011-12.
5)Requires DHCS to adopt regulations by 2015 (was 2013).
6)Changes the title of social worker to social services director
in the list of ADHC core staff.
EXISTING LAW :
1)Provides for the licensure and regulation of ADHC as an
organized day program of therapeutic, social, and health
activities and services provided to elderly persons with
either physical or mental impairments, for the purpose of
restoring an individual's ability to provide self-care,
maintain independence, and avoid institutionalization in a
long-term health care facility. ADHC is provided at ADHC
centers, which are licensed by the Department of Public
Health, and certified for the Medi-Cal program by the
California Department of Aging.
2)Establishes the Medi-Cal program administered by DHCS, to
provide comprehensive health care coverage to certain
categories of low-income eligible individuals and families,
including children, the aged, blind, disabled, nursing home
residents, refugees, and pregnant women. ADHC centers may
qualify for Medi-Cal reimbursement for specified services
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provided to certain persons who are eligible for Medi-Cal.
3)Requires DHCS, by August 1, 2010, and in consultation with
specified stakeholders, to establish a Medi-Cal reimbursement
methodology for ADHC services that is based on the cost of
services provided to an ADHC client. Existing law sets forth
various timeframes associated with the establishment and
implementation of the new reimbursement system, including
timeframes for DHCS to establish new ADHC cost reports, train
ADHC providers on the new methodology, and adopt regulations
to implement the new methodology.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Avoiding the potential loss of more than $150 million in
federal funding. If California does not unbundled ADHC rates
per explicit federal direction, the state risks losing all the
federal Medicaid funding that is matched with state General
Fund (GF) to provide ADHC services to 36,000 recipients
statewide.
2)$1.4 million (50% GF/50% federal) in 2010-11 and $2.6 million
(50% GF/50% federal in 2011-12 to extend 24 currently funded
limited-term auditing positions to establish new rate
methodology.
3)Annual savings in the range of $35 million GF once the new
rate methodology is adopted. The new rate structure will
reduce the rates paid for ADHC services. According to earlier
estimates associated with the initial enactment of SB 1755,
the savings of the new rate approach is expected to approach
20% of total cost.
COMMENTS : According to the author, DHCS has been unable to meet
the current timeframes required by existing law for developing a
new ADHC rate methodology. The author further states that this
bill will provide additional time for the establishment and
implementation of the new rate methodology to ensure that the
methodology is established through a collaborative process
between DHCS and ADHC stakeholders that preserve the integrity
of the program model.
The federal government has recently indicated substantial
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compliance issues with respect to the current reimbursement
methodology for payment of ADHC in the Medi-Cal program. SB
1755 (Chesbro), Chapter 691, Statutes of 2006, requires the
Department of Health Services, (now DHCS), to establish a
cost-based Medi-Cal reimbursement methodology for ADHC services,
establish new eligibility criteria for ADHC services for the
purposes of Medi-Cal reimbursement, and establish daily core
services to be provided by ADHC centers to each participant.
The requirements of SB 1755 of 2006 would address the federal
compliance issues. According to CAADS, sponsor of the bill, the
dates for implementation of the new ADHC reimbursement
methodology were overly ambitious for such a complex endeavor,
and that DHCS has not met the timeframes set forth by SB 1755.
The recently enacted 2009-10 ADHC budget was reduced by $28
million GF associated with reforms to ADHC administration and
funding including limiting services to no more than 3-days per
week for a period of time, a rate freeze, establishing a
definition of medical acuity, on-site treatment authorization
requests and establishing a stakeholder work group to assist
with implementation.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097
FN: 0002661