BILL ANALYSIS �
AB 62
Page 1
Date of Hearing: May 3, 2011
ASSEMBLY COMMITTEE ON HEALTH
William W. Monning, Chair
AB 62 (Monning) - As Amended: April 28, 2011
SUBJECT : Medi-Cal: dual eligibles: pilot projects.
SUMMARY : Requires the Department of Health Care Services (DHCS)
to consult with specified stakeholders in developing and
implementing a pilot project for a Medicaid or Medicare
demonstration project or waiver and authorizes DHCS to respond
to a request for proposal from the federal Centers for Medicare
and Medicaid Services (CMS).
EXISTING LAW :
1)Establishes the Medi-Cal Program, administered by DHCS, to
provide comprehensive health care services and long-term care
(LTC) to pregnant women, children, and people who are aged,
blind, and disabled.
2)Authorizes, under federal law, the waiving of specified
Medicaid (Medi-Cal in California) requirements for
demonstration or pilot projects.
3)Under federal law, establishes the Medicare Program, which
provides health care benefits, to persons 65 years of age and
older and to the disabled. Provides that the Medicare Program
can grant waivers of federal law for demonstration projects.
4)Requires DHCS to seek federal approval for a Medicare,
Medicaid, or combination demonstration project or waiver, for
persons who are Medi-Cal and Medicare eligible (dual
eligible), authorizes the operation of the Medicare component
as a delegated Medicare benefit administrator and the sharing
in any Medicare program.
5)Requires the pilot projects to include at least one two-plan
Medi-Cal managed care county and one Medi-Cal County Organized
Health System (COHS) plan county.
6)Requires DHCS to identify the models by January 1, 2012 and
develop a timeline and process for selection, monitoring, and
evaluating.
AB 62
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FISCAL EFFECT : This bill has not been analyzed by a fiscal
committee.
COMMENTS :
1)PURPOSE OF THIS BILL . According to the author, this bill
provides technical changes to existing law relating to the
Section 1115(a) Medi-Cal Demonstration "Bridge to Reform"
Waiver. SB 208 (Steinberg), Chapter 714, Statutes of 2010,
included provisions authorizing the establishment of pilot
projects in up to four counties with the purpose of developing
effective health care models that integrate Medi-Cal and
Medicare services. The author states that at the time the
authorization was included as part of the Section 1115
Medi-Cal waiver legislation. However, the author states that
CMS requested that the state not include the dual eligible as
part of that waiver. The author explains that the federal
Patient Protections and Affordable Care Act created the Center
for Medicare and Medicaid Innovation (CMMI). The CMMI and
Office of Duals are working on a new initiative "State
Demonstrations to Integrate Care for Dual Eligible
Individuals." According to the author, DHCS submitted a
response to the CMS Request for Proposal (RFP) for this new
initiative on January 28, 2011. The author states that this
bill clarifies that the dual eligible project is not a part of
the Medi-Cal Demonstration Waiver. The author also states
that this bill requires consultation with stakeholders to
ensure that DHCS continues to be informed by interested and
affected members of the stakeholder community.
2)BACKGROUND . Under the current system Medicare is administered
and funded by the federal government and generally covers
primary and acute care and pharmacy. Medi-Cal is the
secondary payer for low-income beneficiaries and covers
primary and acute care, medical equipment, and LTC. Medi-Cal
also pays for home and community-based services but these may
be administered separately such as In Home Support Services.
According to DHCS, there are 1.1 million dually eligible
Medi-Cal enrollees. Although they constitute roughly 10% of
the Medi-Cal population, they account for nearly 25% of annual
Medi-Cal costs. Dual eligibles also account for 75% of the
total Medi-Cal costs for LTC. DHCS states that dual eligible
enrollees are the most chronically ill individuals within both
AB 62
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Medicare and Medicaid, requiring a complex range of services
from multiple providers. According to DHCS, despite the
complexity of their needs, the vast majority of California's
dual eligible remain in the fragmented Fee-For-Service
delivery system. SB 208 directs DHCS to develop a program to
provide more streamlined and effective care for California's
dual eligibles. At the same time, one of the purposes of the
new CMS CMMI and Office of Duals is the improvement of
coordination and to address cost shifting between Medicare and
Medicaid.
3)STATE DEMONSTRATION . SB 208 requires DHCS to include at least
one two-plan Medi-Cal managed care county and one Medi-Cal
COHS plan county. DHCS is required to identify the models by
January 1, 2012 and develop a timeline and process for
selection, monitoring and evaluating. The goals are as
follows:
a) Coordinating Medi-Cal and Medicare benefits across
health care settings and improving continuity of acute
care, LTC, and home and community-based services;
b) Coordinating access to acute and LTC services;
c) Maximizing the ability of dual eligibles to remain in
their homes and communities with appropriate services in
lieu of institutional care; and,
d) Increasing availability of and access to home and
community-based alternative.
According to the response submitted to CMS, DHCS is planning
to implement an integrated care pilot program in four counties
in 2012 with a goal that all dual eligibles will have an
option to enroll in a fully integrated system of care by 2015.
The federal RFP provided for contract opportunity for up to
15 states with up to $1 million per state for design phase.
An implementation phase may be offered in 2012. CMS is
looking for person-centered models that integrate the full
range of acute, behavioral health, and long-term supports and
services for dual eligible individuals.
4)STAKEHOLDER PROCESS . DHCS has convened a Stakeholder Advisory
Committee to advise on preparation of the Section 1115(a)
waiver as required by AB 6 X4 (Evans), Chapter 6, Statutes of
2009 Fourth Extraordinary Session. The Stakeholder Advisory
Committee will also advise on the implementation of the waiver
until its expiration. As specified, the Stakeholder Advisory
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Committee includes persons with disabilities, seniors,
representatives of legal services agencies that serve clients
in the affected populations, health plans, specialty care
providers, physicians, hospitals, county government, labor,
and others as appropriate. A Stakeholder Advisory Committee
was appointed in December 31, 2009 and met on January 7, March
10, May 13, June 10, September 29, and, December 8 in 2010 and
February 10 in 2011. The Stakeholder Advisory Committee has
been sub-divided into five Technical Workgroups which each
have held public meetings to provide technical support to DHCS
on the following aspects:
a) Implementation plan for mandatory enrollment of seniors
and persons with disabilities or an alternative system
where managed care is not appropriate;
b) Implementation plan with respect to children with
special health care needs in the California Children's
Services Program;
c) Implementation plan to pilot and test different
strategies to integrate primary care and behavioral health
services, including substance abuse, in Medi-Cal;
d) Development of the Section 1115 Comprehensive
Waiver/Demonstration Project implementation plan for Health
Care Coverage Initiatives to cover the uninsured; and,
e) Implementation plan for enrollment of Dual Eligible
individuals (those eligible for both Medicare and Medi-Cal)
in an organized system of care that more fully integrates
Medicare and Medi-Cal to provide more effective delivery of
Home and Community Based Services.
DHCS has also established a Waiver Renewal Resource Webpage to
provide resources to those who are interested in the waiver
renewal process and would like to contribute to the effort.
It contains the agendas, timelines, and other materials from
the Stakeholder Advisory Committee and workgroup meetings.
This bill clarifies that a stakeholder consultation process
should also continue to include the dual eligible project even
though it is not part of the Medi-Cal waiver.
5)RELATED LEGISLATION . AB 1066 (John A. P�rez) of 2011 enacts
technical and conforming statutory changes necessary to
implement the Special Terms and Conditions required CMS in the
approval of the Section 1115 Medi-Cal Demonstration Project
entitled "California's Bridge to Reform," approved on Nov 2,
2010. AB 1066 is pending in the Assembly Appropriations
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Committee.
6)PREVIOUS LEGISLATION .
a) AB 342 (John A. P�rez), Chapter 723, Statutes of 2010,
enacted the Low Income Health Program and Coverage
Expansion and Enrollment Projects to provide health care
benefits to uninsured adults up to 200% of the federal
poverty level, at county option through a Medi-Cal waiver
demonstration project.
b) SB 208 (Steinberg), Chapter 714, Statutes of 2010,
implemented provisions of the 2010 Section 1115 replacement
waiver including establishing the Public Hospital
Investment, Improvement and Incentive Fund consisting of
intergovernmental transfers from counties or other
specified governmental entities, to be matched with federal
funds and to be used for investment, improvement and
incentive payments for designated public hospitals and the
affiliated governmental entities (Counties and UC),
authorized DHCS to require the mandatory enrollment of
seniors and people with disabilities in a Medi-Cal managed
care plan commencing the later of either June 1, 2011 or
obtaining federal approval and required DHCS to implement
pilot projects to provide coordinated care to children in
the California Children's Service and to persons who are
eligible for Medi-Cal and Medicare.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file.
Opposition
None on file.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097