BILL ANALYSIS �
AB 2608
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ASSEMBLY THIRD READING
AB 2608 (Bonilla)
As Amended May 25, 2012
Majority vote
HEALTH 18-0 APPROPRIATIONS 17-0
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|Ayes:|Monning, Logue, Ammiano, |Ayes:|Fuentes, Harkey, |
| |Atkins, Bonilla, Eng, | |Blumenfield, Bradford, |
| |Garrick, Gordon, Hayashi, | |Charles Calderon, Campos, |
| |Roger Hern�ndez, | |Davis, Donnelly, Gatto, |
| |Bonnie Lowenthal, | |Ammiano, Hill, Lara, |
| |Mansoor, Mitchell, | |Mitchell, Nielsen, Norby, |
| |Nestande, Pan, | |Solorio, Wagner |
| |V. Manuel P�rez, Silva, | | |
| |Williams | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Eliminates the January 1, 2013, sunset clause and
revises existing provisions implementing the Medicaid local
billing option (LBO) that allows local educational agencies
(LEAs) to obtain federal matching funds for health care services
provided by schools to Medi-Cal eligible students.
Specifically, this bill :
1)Requires the Department of Health Care Services (DHCS) to seek
a state plan amendment and to revise applicable regulatory
requirements pertaining to medical transportation services
provided by LEAs so that LEAs may seek reimbursement for
services as allowed under federal law.
2)Requires funds withheld from the federal matching funds due to
each LEA be collected by reducing payments to all
participating LEAs proportionately and deletes the requirement
that these funds derive only from an amount that exceeds the
baseline amount as set by LEA billing revenues for the 2000-01
fiscal year (FY).
3)Adds a requirement that DHCS include, in the annual report
filed with the Legislature, an accounting of funds that are
withheld from federal matching funds and used by DHCS to fund
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staff and administer the LEA billing option. Requires the
report to detail the amounts withheld from funds that would
otherwise be due to each participating LEA.
4)Adds a requirement that the activities of DHCS include
collaboration with the California Department of Education
(CDE) in order to ensure LEA compliance with state and federal
requirements and to help improve LEA participation.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)One-time minor, absorbable costs to DHCS to modify regulations
to be no more restrictive than federal requirements. Ongoing
costs for additional reporting and collaboration with CDE
should also be minor and absorbable.
2)New federal funding for schools, potentially in millions of
dollars according to the Los Angeles Unified School District
(LAUSD), to the extent schools may be able to submit
additional transportation services for federal reimbursement.
COMMENTS : According to the author, this bill is necessary to
prevent school districts from losing federal funds for health
services that school districts are required to provide. In
addition, the author points out, existing state policies prevent
school districts from seeking federal reimbursement for certain
school transportation that is otherwise reimbursable under
federal guidelines. In light of the current budget proposal to
eliminate funding for home-to-school transportation, overly
restrictive state rules and regulations need to be better
aligned with federal rules to allow for reimbursement for
transportation of students with disabilities. The author argues
that expanding the LBO program in this fashion would generate
millions of dollars statewide for necessary school
transportation for students with disabilities. For example,
LAUSD currently spends $77 million on transportation for 13,000
students with disabilities. However, under the current state
rules, LAUSD is only able to receive $2 million in federal
reimbursement. Currently, state rules do not allow
reimbursement for a child who requires transportation in a
vehicle adapted to serve the needs of the disabled such as a
specially adapted school bus unless the child is in a wheel
chair or a gurney. According to the author, federal rules are
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not so restrictive. According to LAUSD, many of the
responsibilities of DHCS related to the LBO program are set to
expire in 2013. This bill is also needed to continue DHCS
efforts to increase the amount of Medicaid reimbursement
received by California schools. LAUSD also argues, in support,
that greater transparency and accountability in the work
performed by DHCS is needed. According to LAUSD, DHCS is able
to withhold certain amounts from the federal reimbursement
dollars that go to schools in order to offset the costs to DHCS
for administering the LBO program. LAUSD states that protecting
and properly accounting for these withhold amounts ensures that
schools are receiving the federal money they are due.
DHCS is also proposing to delete the January 1, 2013, LBO
program sunset date. The DHCS proposal is through the FY
2012-13 Budget as budget trailer bill language (TBL). The TBL
also eliminates the requirement that a baseline LBO funding
amount must be met prior to funding LBO contractor costs, and
removes the maximum annual funding limit of $1.5 million for
DHCS administrative and contractor costs. According to DHCS,
eliminating the baseline requirement prior to funding the LBO
administrative costs would allow DHCS to reduce federal Medicaid
payments to fund contractor costs without delay. Not acting
could potentially restrict DHCS from generating sufficient funds
to cover all necessary contractor costs. The LBO program
baseline funding level for FY 2000-01 was approximately $60
million. Currently, DHCS monitors reimbursements to the LEAs to
ensure the baseline requirement is met prior to funding
contractor costs required for the LBO program.
Unlike this bill, however, the TBL proposed to set the annual
funding as an amount that would be agreed upon between DHCS and
the LEA Committee. DHCS argued that this would allow sufficient
flexibility to accommodate reasonable cost increases associated
with contract services. The current amount has remained static
since 2001. The Assembly and Senate Budget subcommittees that
have considered this issue have rejected the TBL proposal and
are deferring to the policy committees and this bill.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097
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