BILL ANALYSIS �
AB 2266
Page 1
ASSEMBLY THIRD READING
AB 2266 (Mitchell)
As Amended May 25, 2012
Majority vote
HEALTH 14-5 APPROPRIATIONS 12-5
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|Ayes:|Monning, Ammiano, Atkins, |Ayes:|Fuentes, Blumenfield, |
| |Bonilla, Eng, Gordon, | |Bradford, Charles |
| |Hayashi, | |Calderon, Campos, Davis, |
| |Roger Hern�ndez, Bonnie | |Gatto, Ammiano, Hill, |
| |Lowenthal, Mitchell, | |Lara, Mitchell, Solorio |
| |Nestande, Pan, | | |
| |V. Manuel P�rez, Williams | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Logue, Garrick, Mansoor, |Nays:|Harkey, Donnelly, |
| |Silva, Smyth | |Nielsen, Norby, Wagner |
| | | | |
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SUMMARY : Requires the Department of Health Care Services (DHCS)
to establish a program to provide enhanced health home (EHH)
services, as defined, to persons at high risk of avoidable and
frequent hospital use of hospital services due to chronic health
and behavioral health 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, a chronic or life-threatening medical
condition identified by DHCS as prevalent among frequent
hospital users; a substance abuse or substance dependence
disorder; or, 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
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eligible individual's home.
3)Defines EHH services as individualized case management and a
list of 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.
4)Requires DHCS, no later than January 1, 2014, to do all of the
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 who are operating with a
team of health care professionals, as defined, to implement
the program in 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,
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
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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; current partnership with essential
community hospitals; and, a viable plan for outreach, data
collection, the identification of funding sources, including
for the nonfederal share of costs to sustain the program as
specified.
7)Requires the services provided by the program to include
comprehensive and individualized case management, connection
to medical, mental health and substance abuse services,
community and social support services and referral to other
community and social services, as specified.
8)Authorizes DHCS to designate providers working under a managed
are contract or on a fee-for-service basis and allows DHCS to
develop a per-member per-month payment mechanism.
9)Clarifies that identifying sources of nonfederal funds may
include a plan to partner with health plans, hospitals,
counties, or private funders.
10)Prohibits this bill from being construed to limit DHCS in
targeting additional populations or creating additional
programs under the Health Homes option.
11)Directs, conditioned on federal matching funds, DHCS to
evaluate the program, using only nonstate public or private
funds, within 18 months after designated providers have been
selected and to submit the evaluation to the Legislature.
12)Makes implementation of this bill conditional on the
availability of nonstate public funds or private funds to
fully fund the first eight quarters and thereafter.
Authorizes DHCS to use state funds after the first eight
quarters if there is a finding that costs avoided by
participants is adequate to fund program costs and authorizes
DHCS to terminate or revise the program if it fails to result
in improved health outcomes or to decrease Medi-Cal costs as
specified.
13)Authorizes DHCS to implement this program by means of
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provider bulletins or other similar instructions in lieu of
regulations.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)This bill specifies that funding sources for the nonfederal
share of health home services costs for the first eight months
must be identified by participating providers, and requires
the continued provision of these services to be cost-neutral
to the state after eight months.
2)Direct costs to DHCS include:
a) Program development. One-time administrative costs to
DHCS in the hundreds of thousands of dollars or more,
depending upon the ultimate size and scope of the program.
DHCS has applied for and received a total of $1 million for
planning (50% federal, 50% matching funds from The
California Endowment).
b) Program administration. This annual cost could be up to
the low millions of dollars, depending on the scope of the
program, the number and type of providers, and other
factors.
c) Evaluation. DHCS indicates evaluations for similar
projects generally cost upwards of $1 million.
3)This bill specifies it is only to be implemented if nonstate
public or private funds are available to fully fund the
creation, implementation, administration, and evaluation
costs. Thus, the impact to the General Fund is projected to
be minimal.
4)Limited DHCS Resources. This project will compete with other
projects for limited administrative resources for developing
and implementing health home pilots
5)Savings. Significant medical cost savings may be possible.
Similar projects targeting frequent hospital users have
demonstrated dramatic reductions in costs over a two-year
period. However, cost savings may also be realized by other
Health Home options DHCS is already considering.
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6)Societal Benefit. Enhanced services to stabilize high-needs,
high-cost Medi-Cal beneficiaries could have positive spillover
effects in local communities through reduced demand on social,
public health, and public safety services.
COMMENTS : 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 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.
In November 2010, the federal Centers for Medicare and 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.
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
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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.
Analysis Prepared by : Cassie Royce /Marjorie Swartz/ HEALTH /
(916) 319-2097
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