BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB 540 (Beall)
Hearing Date: 8/25/2011 Amended: 8/15/2011
Consultant: Katie Johnson Policy Vote: 9-0
_________________________________________________________________
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BILL SUMMARY: AB 540 would require the Department of Health Care
Services (DHCS), in consultation with the Department of Alcohol
and Drug Programs (DADP), to provide reimbursement under the
Medi-Cal program for alcohol and drug screening and brief
intervention services for pregnant women or women of
childbearing age.
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Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13 2013-14 Fund
DHCS start-up $50 $75 $50
Federal/*
administrative costs Local
SBI services potentially in the millions of
dollarsFederal/*
utilization annually likely commencing in
Local
FY 2012-2013
Potential future cost potentially significant, in the
Federal/**
avoidance millions of dollars annually
commencingGeneral/
after program implementation Local
Cost pressure to potentially significant, likely in
theGeneral/***
pay private providers millions of dollars annually Federal
for SBI services
*50 percent federal funds, 50 percent public entity funds
**Medi-Cal costs shared 50 percent federal funds, 50 percent
non-federal funds (either General Fund or local funds); Healthy
Families Program costs shared 65 percent federal funds, 35
percent General Fund.
AB 540 (Beall)
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***50 percent General Fund, 50 percent federal funds
STAFF COMMENTS: SUSPENSE FILE.
This bill would require DHCS, in consultation with DADP, to
provide reimbursement to providers of alcohol and drug screening
and brief intervention (SBI) services to Medi-Cal beneficiaries
who are pregnant or women of childbearing age.
This bill would specify that DHCS, in implementing these
provisions, would be required to create an appropriate mechanism
to enable a public entity, defined as a county or other local
governmental entity designated by the department that elects to
provide or contract for SBI services, to pay the non-federal
share of the cost of providing services, to seek all necessary
federal approvals in order to implement these provisions, seek
federal financial participation for all allowable expenditures
matched by public entity funding, and establish standards,
billing codes, and reimbursement rates for SBI services. Federal
financial participation would be required to be remitted by DHCS
to the public entity that submitted the claim.
Administration
This bill would specify that General Fund monies would be
prohibited from being used to implement these provisions and
that this bill would be implemented only to the extent federal
financial participation is available. Any public entity that
elects to participate in this program would be required to
reimburse the state for any costs of creating and administering
these provisions. DHCS would likely need start-up funding of
$100,000 in the first year to seek federal approval and to
develop reimbursement rates. Ongoing costs would likely be about
$50,000 annually. All costs would be shared 50 percent public
entity funds and 50 percent federal funds. It is unknown to what
extent DADP would be needed to consult with DHCS on matters
related to this bill. Costs would likely be minor and
absorbable.
SBI Services Cost Estimate
As a result of this bill, there would be new claims for
reimbursement from public entities that choose to provide SBI
services to Medi-Cal beneficiaries who are pregnant or women of
childbearing age. As of July 2010, there were between 1.7
million and 1.8 million women of childbearing age, aged 16 - 50,
AB 540 (Beall)
Page 2
enrolled in Medi-Cal of which about 250,000 give birth annually.
Medi-Cal pays for approximately 46 percent of births in
California each year.
According to the federal Substance Abuse and Mental Health
Services Administration (SAMHSA), Medicaid, Medi-Cal in
California, reimburses $24.00 for alcohol or drug screening and
$48.00 per 15 minutes for alcohol or drug brief intervention
services. National SAMHSA data shows that in 2008-2009 4.5
percent of pregnant women and 10.6 percent of other women aged
16 - 44 years used illicit drugs. Costs for 1) screening, and 2)
brief intervention for women with positive screens are estimated
as follows:
1) Assuming a screening at $24.00 for 1.75 million women of
childbearing age, it would cost up to $42 million to screen
all women eligible for these services pursuant to this
bill.
2) Assuming brief intervention costs of $48 - $96 for 1 - 2
intervention sessions for 4.5 percent of 250,000 pregnant
women, it would cost between $540,000 and $1,080,000 in
total funds to provide brief intervention to pregnant
women. Assuming 10.6 percent of 1.5 million other women of
childbearing age were given brief intervention services, it
would cost approximately $7.6 million - $15.3 million in
total funds.
Total annual costs could be up to $42 million - $57.3 million
and would be shared 50 percent federal funds and 50 percent
public entity funds. Actual costs would depend on 1) the number
of public entities that would elect to participate in this
program, 2) the number of women that would choose to be screened
by those programs and how often they were screened, 3) the
number of women who would screen positive, and 4) the number of
women who screened positive and would then choose to receive
brief intervention services.
Since this bill would only establish a reimbursement mechanism
for SBI services provided by public entities, there would be
cost pressure in the millions of dollars to reimburse private
entities that choose to provide SBI services to Medi-Cal
beneficiaries. Costs would be shared 50 percent General Fund and
50 percent federal funds.
AB 540 (Beall)
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Potential Cost Avoidance
SAMHSA reports that SBI services result in a 4 to 1 return on
investment. If this program were to result in a similar return
on investment upon implementation, based on the estimates above,
there could eventually be cost avoidance to Medi-Cal, and
potentially the Healthy Families Program, of up to $172 million
in total funds if all women in California eligible for services
pursuant to this bill were screened and given brief intervention
services as needed.
Previous Legislation
AB 1599 (Beall, 2010), AB 217 (Beall, 2009), and AB 2124 (Beall,
2008) were substantially similar to this bill. AB 1599 and AB
2124 died on the Assembly and Senate Appropriations Committees'
respective suspense files. Governor Schwarzenegger vetoed AB 217
stating, "?Clinical data shows that screening and brief
interventions reduce avoidable health problems associated with
alcohol and drug abuse, including emergency room utilization as
well as reducing substance use-related arrests and traffic
violations. Unfortunately, this bill contains several
significant problems that prevent its implementation and put the
state General Fund at risk."