BILL ANALYSIS �
AB 2266
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Date of Hearing: April 24, 2012
ASSEMBLY COMMITTEE ON HEALTH
William W. Monning, Chair
AB 2266 (Mitchell) - As Amended: April 17, 2012
SUBJECT : Medi-Cal: Enhanced Health Homes for Frequent Hospital
Users with Chronic Conditions.
SUMMARY : Requires the Department of Health Care Services (DHCS)
to establish a program in at least five counties to provide
enhanced health home (EHH) services, as defined, to frequent
hospital users with chronic conditions. Specifically, this
bill :
1)Defines "eligible individual" to mean an individual identified
by DHCS as experiencing two or more of the following: a mental
health disorder or a chronic or life-threatening medical
condition identified by DHCS as prevalent among frequent
hospital users; a substance abuse or substance dependence
disorder; and, significant cognitive impairments, as
specified; and who has at least two specified risk indicators.
2)Defines EHH to mean a designated provider, such as a
physician, clinical practice or clinical group practice, rural
health clinic, community health center, community mental
health center, home health agency, or any other entity or
provider, operating, or proposing to operate, with a care
coordination team of specified health care professionals,
that, among other things, elects to participate in the
program; meets the criteria described in federal guidelines;
and, offers services in a range of settings, including the
eligible individual's home.
3)Defines EHH services as a list of specified individualized,
multidisciplinary services and supports that must be provided
to eligible individuals in the program in order to decrease
hospitalizations and crisis episodes, reduce medical risks,
and increase functioning to achieve and maintain
rehabilitative, resiliency, and recovery goals. Requires at
least 60% of the EHH services to be provided in natural
settings, including in an eligible individual's home.
4)Requires DHCS, no later than January 1, 2014, to do all of the
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following:
a) Design, with opportunity for public comment, a program
to provide EHH services to persons at high risk of
avoidable and frequent use of hospital services due to
complex co-occurring health and behavioral health
conditions. Requires the program to be designed to reduce
a participating individual's avoidable use of hospitals
when more effective care and social services can be
provided in less costly settings;
b) Select designated providers to implement the program in
at least five counties using a request for proposals
process, as specified; and,
c) Submit a request for a Medi-Cal State Plan Amendment
(SPA) pursuant to the Health Homes for Enrollees with
Chronic Conditions Medicaid option (Health Homes option)
enacted in the federal Patient Protection and Affordable
Care Act (ACA).
5)Requires the program established by this bill to serve
Medi-Cal beneficiaries; newly enrolled Medi-Cal beneficiaries
upon implementation of Medicaid expansion under the ACA; and,
enrollees in counties with Low Income Health Programs (LIHP),
established through California's 2010 Section 1115(a) Medicaid
"Bridge to Reform" Waiver, as specified.
6)Requires DHCS to select designated providers operating with a
team of health care professionals that has a community clinic,
a specified mental health services provider, or a hospital, as
its designated lead provider and that meets several specified
criteria, including demonstrated experience working with
frequent hospital users and the chronically homeless; the
capacity and administrative infrastructure to participate in
the program and meet federal guidelines; documented ability to
provide or link clients with appropriate community-based
services, as specified; the support of essential community
hospitals; and, a viable plan for outreach, data collection,
and the identification of funding sources, as specified.
7)Clarifies that local entities, health plans, or foundations
shall not be precluded from contributing the nonfederal share
of costs for services provided under the program established
by this bill.
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8)Prohibits this bill from being construed to limit DHCS in
targeting additional populations or creating additional
programs under the Health Homes option.
9)Directs DHCS to evaluate the program, using only private
funds, within 18 months after designated providers have been
selected and to submit the evaluation to the Legislature.
10)Makes implementation of this bill conditional on the
availability of federal financial participation, approval of
the SPA, and only to the extent non-General Fund moneys are
available for use as the nonfederal share, as specified.
EXISTING LAW :
1)Establishes the Medi-Cal program, administered by DHCS, and
under which qualified low-income persons receive health care
benefits.
2)Authorizes, under federal law, the waiving of specified
Medicaid (Medi-Cal in California) requirements for
demonstration projects, for care delivered through primary
care case-management systems, or for the provision of home- or
community-based services.
FISCAL EFFECT : This bill has not yet been analyzed by a fiscal
committee.
COMMENTS :
1)PURPOSE OF THIS BILL . The author states that frequent
hospital users who are homeless often have chronic medical,
mental health, or substance abuse conditions and face
significant barriers to accessing regular or preventive care
and complying with treatment. The author points out that,
without a home, these individuals cannot improve their health
outcomes or reduce their costly use of acute care services,
lack a place to store medications, and are unable to maintain
appropriate hygiene, adhere to a healthy diet, and properly
recover from illness. According to the author, this bill will
require California to access federal funding for the provision
of EHH services to this population by taking advantage of the
health homes option available under the ACA, which provides
states with 90% federal money for two years to deliver such
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wraparound services as intensive case management and care
coordination. The author adds that this bill also provides
options for ongoing funding if these EHH services demonstrate
decreased costs.
2)FREQUENT USER POPULATION . Frequent users are often
chronically ill, under- or uninsured individuals who
repeatedly use hospitals for medical crises that could be
prevented with more appropriate ongoing care. They usually
have multiple psychosocial and medical problems, such as
mental illness, substance addiction, chronic medical
conditions, and cognitive impairments, as well as non-medical
issues, such as a lack of housing and transportation, that all
contribute to an inability to follow-through with a treatment
plan. Though frequent users represent a small segment of the
current Medi-Cal and uninsured population, they drive a large
share of public costs. According to DHCS data, 1,000
high-cost, high-need Medi-Cal beneficiaries who visited the
emergency department (ED) at least five times between January
and December 2007, and had been diagnosed with a chronic
physical condition, and a mental health or substance abuse
disorder, incurred costs of over $100,000 each during the
course of the year.
3)HEALTH HOME . According to a January 2011 issue brief from the
Kaiser Family Foundation (KFF), health homes are robust
medical homes that seek to integrate physical and behavioral
health services rather than treat them as separate, episodic
care needs. Behavioral health illnesses often compound the
effects of physical illness; for example, health care
providers often struggle to treat the physical conditions of
patients who are clinically depressed.
KFF reports that behavioral health co-morbidities are
particularly prevalent in high-risk populations with multiple
chronic conditions. An estimated 65% of Medicaid adults with
a 'top five' chronic condition (i.e. asthma, congestive heart
failure, coronary artery disease, diabetes, or hypertension)
have at least one behavioral health condition. Coordinating
behavioral health services and medical services is critical
for these populations.
According to KFF, health homes also go beyond the comprehensive
treatment offered through a care team by extending their reach
into the community and offering referral and support services
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outside the immediate care setting. Coordinating with
community organizations to provide locally-based resources for
the management of chronic conditions or provide education
about the importance of healthy lifestyle choices is
particularly important for populations like homeless frequent
hospital users who have low health literacy.
4)ACA HEALTH HOME OPTION . In November 2010, the federal Centers
for Medicare & Medicaid Services (CMS) issued preliminary
guidance to states describing the requirements, choices,
funding opportunities, and expectations for successful
implementation of the health home provision of the ACA. To
encourage states to adopt the health home option, the ACA
authorized a temporary, two-year 90% federal match rate for
specified health home services. To be eligible for health
home services, Medi-Cal beneficiaries must have at least two
specified chronic conditions; one chronic condition and be at
risk for another; or one serious and persistent mental health
condition. States are allowed to target health home services
to those with particular chronic conditions or those with
higher numbers or severity of chronic or mental health
conditions.
According to the CMS guidance, health home services that are
eligible for the 90% enhanced federal matching rate include
comprehensive care management; care coordination and health
promotion, comprehensive transitional care from inpatient to
other settings, including appropriate follow-up; individual
and family support; referral to community and social support
services, if relevant; and, the use of health information
technology to link services. These services must be provided
by a designated health home provider arrangement.
CMS expects use of the health home service delivery model to
result in lower rates of ED use, reductions in hospital
admissions and re-admissions, reductions in health care costs,
less reliance on long-term care facilities, and, improved
experience of care and quality of care outcomes for the
individual. CMS adds that states that opt to provide the
health homes benefit, and the health home providers with which
the states collaborate, are expected to operate under a "whole
person" philosophy that cares not just for an individual's
physical condition, but provides linkages to long-term
community care services and supports, social services, and
family services.
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To support state planning activities, CMS authorized state
applicants to spend up to $500,000 of Medicaid funding for the
development of a health home SPA. DHCS reports that it
applied for and received these planning grant funds and is
currently in the process of completing assessments of health
home state plan options, including modeling health homes in
Medi-Cal managed care organizations. CMS guidance allows
states to offer a variety of provider arrangements to
implement the health home option and authorizes beneficiaries
to choose among those options. The approach in this bill
requires DHCS to initiate a request for proposals process to
designate specific providers.
5)BRIDGE TO REFORM WAIVER . In November 2010, California
received federal approval for a new five year Section 1115
Medi-Cal Demonstration/Pilot Project Waiver, entitled "A
Bridge to Reform." Section 1115 of the Social Security Act
authorizes the federal Secretary of Health and Human Services
to allow states to receive federal Medicaid matching funds
without complying with all of the federal Medicaid rules.
Waivers are traditionally designed as research and
demonstration programs to test innovative program improvements
and facilitate coverage expansions to populations not
otherwise eligible. The Bridge to Reform Waiver is intended
to serve as a bridge to implementation of the ACA, which
requires states to include childless adults, under age 65, who
are not otherwise eligible for Medi-Cal or Medicare with
incomes up to 133% of the federal poverty level (FPL) ($14,484
for an individual in 2011) in their Medicaid programs.
KFF reports that the Bridge to Reform Waiver makes approximately
$8 billion in federal Medicaid matching funds available and
includes, as one of its key initiatives, the LIHP Coverage
Expansion. Through LIHPs provided at the option of each
county, the state will extend coverage to low-income
non-pregnant adults between ages 19 and 64 who are not
enrolled in Medicaid who have incomes at or below 133% FPL (or
a lower threshold set by the county) and between 133% and 200%
FPL ($21,780 for an individual in 2011) (or a lower threshold
set by the county). DHCS indicates that 47 of the state's 58
counties are currently operating a LIHP.
6)FREQUENT USER PROGRAMS . In 2003, California launched a
five-year, $10 million project called the Frequent Users of
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Health Services Initiative (Initiative) to address the issue
of avoidable ED use by frequent user patients. The Initiative
focused on promoting a more responsive system of care to
address frequent users' multiple needs, produce better
outcomes, and re-direct ED resources toward acute medical
crises and funded six urban and rural sites throughout the
state that served a total of 1,100 Medi-Cal clients. Data
from a 2008 final evaluation of the Initiative showed
significant decreases of between 55% and 80% in ED visits, ED
charges, inpatient admits, and inpatient charges for Medi-Cal
participants who engaged in services for two years. Moreover,
programs provided by the six sites succeeded in stabilizing
participants' lives. Data from the Initiative demonstrated
that 69% of homeless clients became housed, 70% of uninsured
clients were connected to Medi-Cal or county health services,
and 35% of disabled clients without incomes became federal
supplemental security income recipients after receiving
Initiative services for one year.
According to a June 2009 report prepared by the Corporation for
Supportive Housing (CSH), other programs, similar to the
Initiative, intended to reduce frequent avoidable ED use
reported like outcomes. CSH notes in its report that San
Francisco General Hospital (SFGH) published a research study
in April 2007 comparing outcomes of frequent users randomly
assigned to receive case management services to frequent users
receiving usual care. The study reported a 40% reduction in ED
costs within the first year and found that the savings in ED
costs offset the full cost of the program. Researchers
concluded from these findings that case management was
associated with statistically and practically significant
decreases in ED utilization and cost. The SFGH study also
documented a 50% reduction in homelessness and a 25% reduction
in substance abuse among participants. Similarly, CSH cites a
July 2006 study in Psychiatric Services that found that among
mentally ill Californians experiencing homelessness, 91% of
whom had a substance addiction, the provision of supportive
housing and other wraparound services reduced their number of
ED visits by 56% and hospital admissions by 45%.
7)SUPPORT . Supporters, representing providers, clinics,
affordable housing groups, and consumer advocates, state that
this bill will reduce Medi-Cal costs, decrease avoidable ED
and inpatient stays, and improve health outcomes for extremely
vulnerable Californians, without any initial state investment.
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The California Primary Care Association, which represents
community clinics and health centers, states that it is
committed to implementing the health home model of care
throughout the state because it will both improve quality of
care and reduce costs and this bill will help support those
efforts. CSH writes that this bill complements the state's
health reform goals and promotes proven strategies that are
easy to implement. The Western Center on Law and Poverty
asserts that the health home approach in this bill will better
coordinate care for Medi-Cal beneficiaries with the aim of
reducing excess hospitalizations by providing targeted care to
a vulnerable population that faces significant barriers to
staying healthy. Lastly, Health Access California adds that
this bill will provide useful information about a promising
strategy for saving the state money that is currently spent
providing care to frequent users in expensive ED settings.
8)RELATED LEGISLATION . SB 393 (Ed Hernandez) enacts the
Patient-Centered Medical Home (PCMH) Act of 2011 and
establishes a definition for a medical home based upon
specified standards. SB 393 is pending in the Assembly Health
Committee.
9)PRIOR LEGISLATION .
a) AB 1066 (John A. P�rez), Chapter 86, Statutes of 2011,
enacts technical and conforming statutory changes necessary
to implement the special terms and conditions required by
CMS in the approval of California's Section 1115(a) Bridge
to Reform waiver.
b) AB 1542 (Jones) of 2009 would have defined a PCMH to
mean, in part, a health care delivery model in which a
patient establishes an ongoing relationship with a
physician or other licensed health care provider, working
in a physician-directed practice team to provide
comprehensive, accessible and continuous evidence-based
primary care and coordinate the patient's health care needs
across the health care system. AB 1542 died on the
Assembly Floor.
c) SB 1738 (Steinberg) of 2008 would have required DHCS to
establish a three-year pilot program to provide intensive
multidisciplinary services to 2,500 Medi-Cal beneficiaries
identified as frequent users of health care. SB 1738 was
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vetoed by Governor Schwarzenegger who stated in his veto
message that he could not support the bill because of the
state's ongoing fiscal challenges and asked the author and
stakeholders to work with his Administration to identify
strategies to ensure these beneficiaries receive the right
care, at the right time, in the right setting.
REGISTERED SUPPORT / OPPOSITION :
Support
American College of Emergency Physicians, California Chapter
California Association for Health Services at Home
California Primary Care Association
Century Housing
Corporation for Supportive Housing
Health Access California
Housing California
Mental Health Association in California
National Association of Social Workers, California Chapter
United Homeless Healthcare Partners
Western Center on Law and Poverty
Opposition
None on file.
Analysis Prepared by : Cassie Royce / HEALTH / (916) 319-2097