BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 488
                                                                  Page  1

          Date of Hearing:   May 11, 2011

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                  AB 488 (Cook) - As Introduced:  February 15, 2011 

          Policy Committee:                              Vets Vote:8-0

          Urgency:     No                   State Mandated Local Program:  
                 Reimbursable:              

           SUMMARY  

          This bill creates, what is in effect, a cap on the charges that 
          non-veteran spouses living in a veterans' home must pay by 
          requiring non-veteran spouses to pay the same sliding scale fees 
          and charges as the veteran spouse. 

           FISCAL EFFECT  

          Moderate annual GF costs, likely in excess of $150,000 in future 
          years. CDVA does not receive federal reimbursement for 
          non-veteran spouses. Therefore, the GF would have to cover the 
          difference in cost, which is about $5,000 per year for each 
          non-veteran spouse. Most non-veteran spouses are grandfathered 
          in under the 2009 cap, but there appear to be about 20 who are 
          not. This number should increase in future years.

          This bill reverses a 2009-10 budget action that removed the cap 
          on residential fees. Until 2009 there was a cap on residential 
          fees for each classification of care:  $1,200 per month for 
          residential care, $2,300 per month for intermediate care, and 
          $2,500 per month for skilled nursing care.  The budget action 
          removed caps for all levels of care, added a separate fee 
          structure for the Residential Care Facility for the Elderly 
          (RCFE), and required non-veteran spouses to pay 90% of income up 
          to $1,100 per month or $1,032 per month, whichever is greater.   
           

           COMMENTS

          1)Rationale  . The author contends restoring a cap on the amount a 
            non-veteran's spouse must pay for residence in a veterans' 
            home is worthy state fiscal policy. The author notes that if 








                                                                  AB 488
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            the non-veteran spouse's income is less than what the federal 
            government would pay, then the non-veteran spouse pays 90% of 
            his/her income. Thus, under existing law the non-veteran 
            spouse may pays more for the same services and/or must choose 
            between that pay structure and living apart from his or her 
            spouse. 

           2)Current law  specifies that non-veteran spouses who become 
            members of the home on or after July 1, 2009, either pay the 
            same fees and charges as their veteran spouses, or an amount 
            equal to the annual amount of federal per diem received for a 
            veteran member in residential care, whichever is greater. If 
            the non-veteran spouse's income is less than the annual amount 
            of federal per diem for a veteran member in residential care, 
            the non-veteran member must pay a maximum of 90% of his/her 
            annual income.
           
          3)Related legislation  , AB 487 (Cook) amends the same code 
            section and restores veterans' home fees caps at increased 
            levels.
           

           Analysis Prepared by  :    Geoff Long / APPR. / (916) 319-2081