BILL ANALYSIS
SENATE HUMAN
SERVICES COMMITTEE
Senator Carol Liu, Chair
BILL NO: SB 891
S
AUTHOR: Liu
B
VERSION: March 25, 2010
HEARING DATE: April 13, 2010
8
FISCAL: Appropriations
9
1
CONSULTANT:
Park
SUBJECT
In-home supportive services
SUMMARY
Requires the Department of Social Services (DSS) and the
Department of Health Care Services to convene jointly a
stakeholder review process on specified aspects of the
in-home supportive services (IHSS) program.
ABSTRACT
Existing federal law:
1.Establishes the Medicaid program, which provides
comprehensive health coverage to low-income eligible
individuals and families, including children; the aged,
blind, and disabled; and pregnant women, through a
program that reimburses states for the Medicaid programs
in the individual states.
2.Authorizes states to levy fees or taxes on health care
providers if they meet federal requirements. For
example, provider taxes or fees must be "broad based" and
uniformly applied to all providers within specified
classes of providers, and states are prohibited from
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making from a direct or indirect guarantee that providers
receive their money back. To ensure that the fees or
taxes are broad-based, existing federal regulations
specify classes of health care providers, including an
"other" category, on which the state has created a
licensing or certification fee.
Existing state law:
1.Establishes the IHSS program to assist low-income elderly
and disabled individuals with tasks of daily living so
they can remain safely in their homes.
2.Requires DSS to establish statewide hourly task
guidelines for the chores and services provided through
IHSS and to provide a standardized tool for consistent
and accurate assessment of a recipient's service needs.
3.Requires counties administering the IHSS program to
evaluate a recipient's functioning in activities of daily
living and instrumental activities of daily living using
one of five rankings, as specified.
4.Requires a recipient of IHSS services to be assigned a
functional index score, a weighted average based on the
individual functional index rankings, to provide a single
measure of a recipient's relative dependence on human
assistance for performance of activities of daily living
that are used in the assessment of IHSS services.
5.Limits IHSS services to those with higher levels of need,
as determined by rankings and scores created with a
uniform needs-assessment tool. Specifically, deems a
recipient eligible for domestic and related services
(housework, laundry, shopping and errands, meal
preparation and meal clean-up) only if he or she has a
functional index rank of 4 or above (on a scale of 1 to
5, with 5 as the highest level of need for assistance)
for each particular service. Deems ineligible for any
services individuals whose functional index score is
below 2.0. Exempts specified individuals.
This bill:
1.Requires the DSS and DHCS to jointly convene a
stakeholder review process to obtain information and
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comments regarding both of the following:
The imposition of a tax on payments received by
IHSS providers, and the potential for increased
federal financial participation as a result of these
tax revenues.
Alternatives to the state's methodology for
deriving a functional index score for in-home
supportive services consumers.
1.Requires all of the following to be included in the
stakeholder review process: statewide organizations
representing the interests of consumers, family members,
service providers, and statewide advocacy organizations,
as well as appropriate policy and fiscal staff of the
Legislature.
FISCAL IMPACT
Unknown.
BACKGROUND AND DISCUSSION
Author's statement
The author states that, while California has successfully
operated the IHSS program for several decades, and despite
generous amounts of combined federal and county funding for
the program, recent changes to the program driven by the
state's budget deficit make it necessary for the state and
the IHSS stakeholders to examine the long-term financial
viability of the program and who it serves. The author
asserts that the future of the IHSS program will be
integral to any efforts to establish a more integrated
long-term care continuum for people with disabilities and
an aging population, as well as meaningfully comply with
the federal Olmstead decision, which affirms the rights of
people with disabilities to live in their communities. The
author notes that the current functional index score may
not adequately address or accurately reflect the needs of
the current population.
In-Home Supportive Services program
The IHSS program provides in-home care to persons who
cannot safely remain in their homes without assistance.
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Under the program, about 376,000 in-home care workers
provide services, ranging from bathing to meal preparation,
to more than 430,000 low-income elderly and disabled
persons. The program is credited with allowing many
individuals to remain in their own homes rather than being
placed in more costly nursing home care.
According to the Legislative Analyst, some version of the
IHSS program has been present in California since the
1950s. Until 1993, IHSS was funded through a combination
of state, federal Title XX (Social Services Block Grant
funds), and county funds. Since 1993, a growing number of
IHSS recipients have become eligible for federal Medicaid
funding under the personal care services program of
Medicaid. Currently, roughly 92 percent of the caseload is
covered under personal care services of Medicaid, 7 percent
of the caseload is covered under a separate waiver, which
also receives federal funding. Only one percent of the
caseload is not eligible for federal Medicaid funding.
Generally, for almost all IHSS recipients, 50 percent of
program costs are paid by the federal government, about
32.5 percent by the state, and 17.5 percent by the county.
(For the 1 percent of IHSS recipients not eligible for
federal Medicaid funding, program costs for these
recipients are shared 65 percent by the state and 35
percent by the counties.) Administration costs are shared
50 percent by the federal government, 35 percent by the
state, and 15 percent by the counties. The American
Recovery and Reinvestment Act of 2009 temporarily increased
the federal share of IHSS program costs from 50 percent to
61.6 percent from October 2008 through December 2010.
Rankings and functional index scores
ABx4 4 (a 2009-10 budget trailer bill) eliminated domestic
and related services for an IHSS recipient, if he or she
has a ranking of less than 4 for that particular domestic
or related service (affecting approximately 85,000
recipients), and eliminated all IHSS services for
recipients with FI scores (the weighted average of all of
the individual functional index ranks) of less than 2
(affecting approximately 39,000 recipients). However, a
federal district court issued an injunction and these
provisions have not taken effect. The Administration is
appealing in the 9th Circuit.
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In court briefs, parties have noted that the current
composite functional index score is particularly unsuited
to determining specific client's needs for particular IHSS
services, and does not adequately take into account mental
impairment. For example, recipients are ranked on eleven
physical tasks and three mental functions; however, certain
categories can only be ranked a 1, 4, or 5, or 1, 2, or 5.
Additionally, the functional index score does not include
the functional ranks for mental functioning, and there are
no functional ranks for certain tasks for which IHSS hours
may be authorized, such as assistance with
self-administration of medication, or assistance with
prosthetic devices, or repositioning. Court briefs also
noted that the relative weights for determining FI score
has not changed since the system was first implemented in
1988. In a report on considering the costs and benefits of
the IHSS program, the Legislative Analyst recommended that
the Legislature might create a better measure of impairment
for IHSS recipients than the current system.
Medicaid provider taxes
Many states (including California) fund a portion of their
share of Medicaid program costs through a fee on health
care providers. Under these funding methods, states
collect funds (through fees, taxes, or other means) from
providers, which can then be matched with federal funds.
The resulting combination of state and federal funds is
then used for a variety of purposes, such as increasing
Medicaid reimbursements to providers. California currently
has provider fees on intermediate care facilities for the
developmentally disabled, Medi-Cal managed care plans, and
skilled nursing facilities.
A recent report funded through the California Community
Choices project (which was funded through the Centers for
Medicare and Medicaid Services, or CMS), Home and
Community-Based Long-Term Care: Recommendations to Improve
Access for Californians, by Robert Mollica and Leslie
Hendrickson, National Academy for State Health Policy
(November, 2009), recommends that California increase the
use of provider fees for home and community based services
to obtain more federal matching funds, as allowed by
federal law. In testimony offered to this committee at a
January 26, 2010, hearing on the future of long-term care,
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one of the report's authors stated that the IHSS program
was underrated and not given enough credit in terms of
having a large impact on the nursing facility budget,
lowering its expenditures, and contributing to substantial
cost avoidance.
According to a document published by Health Management
Associations in 2008, 43 states impose provider assessments
on at least one category of health care providers. The
document states that state provider assessment plans must
comply with certain federal requirements in order to be
considered "permissible" health care related taxes, and
only permissible taxes that are approved by CMS may receive
federal financial participation.
In considering a tax on a non-identified class or services,
Health Management Associations notes that,
?while federal rules specifically list emergency
ambulance as a class/service for purposes of a
health care-related tax, non-emergency
transportation services would fall under "other
health care items or services" (42 CFR 433.56) on
which the state has enacted a licensing or
certification fee. In Kansas, non-emergency
transportation providers are required to register
with the state, but do not appear to be specifically
licensed as Medicaid providers. If registered
providers are not considered to be "licensed" or
"certified" by either the state or CMS, the state
could tax non-emergency transportation providers
independently of the provider tax rules, since such
providers would be neither a distinct class of
provider nor an "other health care item or service"
licensed by the state. Further investigation would
need to be undertaken to determine what the federal
government considers to be a licensed provider to
ensure that the provider tax rules would not apply
to such a tax. If registered providers are
considered "licensed" providers, however, the
federal provider tax rules would apply to any tax
imposed.
Additionally, the group notes that federal regulations
define a health care-related tax as a "licensing fee,
assessment or other mandatory payment" that is related to
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health care items or services (42 CFR 433.55), and suggests
that a state could choose to impose a licensing fee on all
Medicaid providers that could be collected as part of the
provider enrollment or renewal process, or as an annual fee
that is uniform or varies by class of provider.
Last year, the State of Missouri enacted a tax on certain
providers, including in-home care providers, contingent on
federal approval.
California's Olmstead plan
In May 2003, the California Health and Human Services
Agency published the California Olmstead Plan, which stated
that the U.S. Supreme Court's Olmstead decision reflects
the findings of the Americans with Disabilities Act that
persons with disabilities have the right to live in the
most integrated setting possible. The document noted that
the state commits to providing services to people with
disabilities in the most integrated setting and to adopting
and adhering to policies and practices that will provide a
full array of services and programs that make it possible
for persons with disabilities to remain in their
communities and avoid unnecessary institutionalization.
The document further notes:
Well before the Olmstead decision, California was a
leader in providing services to support the full
integration of persons with disabilities in community
life. These services, which were born out of the
independent living/disability rights movement,
included the availability of personal assistance
services to avoid institutionalization for those
individuals who required assistance with activities of
daily living. In fact, as a result of two decades of
state legislative and budgetary actions, California
has the largest consumer directed personal care
program in the U.S., the In-Home Supportive Services
(IHSS) Program, which supports over 250,000
Californians on a statewide basis. In the past three
years, expenditures for this program have almost
doubled to nearly $2 billion, as increased worker
wages and benefits have been phased in.
Arguments in support
The Coalition of California Welfare Rights Organizations
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writes that the bill would provide for public involvement
in an important issue and requests that the bill be amended
to provide that stakeholder meetings be subject to the
Bagley-Keene Open Meeting Act to assure that the process is
transparent. United Domestic Workers of America states
that it supports the measure because it believes that
thorough discussions around the issues that the bill
addresses are greatly needed.
POSITIONS
Support: County Welfare Directors Association of
California
Coalition of California Welfare Rights
Organizations
United Domestic Workers of America/AFSCME
Oppose:None received
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