BILL ANALYSIS �
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THIRD READING
Bill No: AB 2608
Author: Bonilla (D)
Amended: 8/23/12 in Senate
Vote: 21
SENATE HEALTH COMMITTEE : 9-0, 6/20/12
AYES: Hernandez, Harman, Alquist, Anderson, Blakeslee, De
Le�n, DeSaulnier, Rubio, Wolk
SENATE APPROPRIATIONS COMMITTEE : 7-0, 8/6/12
AYES: Kehoe, Walters, Alquist, Dutton, Lieu, Price,
Steinberg
ASSEMBLY FLOOR : 74-0, 5/30/12 - See last page for vote
SUBJECT : Medi-Cal: local educational agency billing
option
SOURCE : Los Angeles Unified School District
DIGEST : This bill makes permanent and expands provisions
relating to program improvement activities in the Medi-Cal
Local Billing Option (LBO) program, through which Local
Educational Agencies (LEA) can draw down federal funding
for health care services provided to Medi-Cal-eligible
students, and requires money collected for administrative
activities for program improvement activities accounted for
reduced from federal Medicaid payments to all participating
LEAs so that no one LEA loses a disproportionate share of
its Medicaid payment.
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Senate Floor Amendments of 8/23/12 sunset the statutory LEA
transportation provisions made by the bill on January 1,
2018, or when regulations have been done, whichever is
later, and modify the requirements relating to an
accounting of funds.
ANALYSIS : Existing law:
1.Establishes the Medi-Cal program, administered by the
Department of Health Care Services (DHCS), under which
qualified low-income persons receive health care
benefits.
2.Requires specified services provided by a LEA are covered
Medi-Cal benefits, to the extent federal financial
participation is available, are subject to utilization
controls and standards adopted by DHCS, and are
consistent with Medi-Cal requirements for physician
prescription, order, and supervision.
3.Requires DHCS to make various LEA program improvement
activities, including:
A. Amending the Medicaid state plan with respect to
the LBO for services by LEAs to ensure that schools
are reimbursed for all eligible services that they
provide that are not precluded by federal
requirements;
B. Eliminating and modifying state plan and regulatory
requirements that exceed federal requirements when
they are unnecessary;
C. Consulting regularly with the Department of
Education (DOE); representatives of urban, rural,
large and small school districts; county offices of
education, the local education consortium; and LEAs in
order to assist DHCS in formulating the Medicaid state
plan amendments; and
D. Filing an annual report with the Legislature.
1.Requires LEA program improvement-related activities to be
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funded and staffed by proportionately reducing federal
Medicaid payments allocable to LEAs. Prohibits the
annual amount funded for program improvement activities
from exceeding $1.5 million dollars. Requires funding
received under this provision to derive only from federal
Medicaid funds that exceed the baseline amount of LEA
Medicaid billing option revenues for the 2000-01 fiscal
year (FY).
2.Requires, as part of the LEA program improvement
activities, DHCS to file an annual report with the
Legislature regarding LEA that includes a state-by-state
comparison of school-based Medicaid total and per child
eligible claims and federal revenues; a summary of DHCS
activities, a listing of all school-based services,
activities, and providers approved for reimbursement by
the federal government in other state plans that are not
approved in California; any barriers to LEA reimbursement
that are not imposed by federal requirements; and a
description of the actions that have been and will be
taken to eliminate them.
3.Authorizes DHCS to enter into a sole source contract to
comply with these program improvement requirements.
4.Sunsets the LEA program improvement activity-related
provisions January 1, 2013.
This bill:
1.Makes the LEA program improvement provisions permanent by
eliminating the January 1, 2013, sunset date.
2.Eliminates a requirement that LEAs receive a baseline
Medicaid funding amount (the amount LEAs received in the
2000-01 fiscal year) before federal Medicaid moneys can
fund administrative activities related to program
improvements.
3.Requires money collected for administrative activities
for program improvements be proportionately reduced from
Medicaid payments to all participating LEAs so that no
one LEA loses a disproportionate share of its federal
Medicaid payments.
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4.Exempts medical transportation for those eligible to be
billed under the LEA billing option from the following
specified Medi-Cal regulations:
A. The requirement that patients be transported in a
prone or supine position because the patient is
incapable of sitting for the period of time needed to
transport.
B. The requirement that the patient be transported in
a wheelchair or assisted to and from residence,
vehicle and place of treatment because of a disabling
physical or mental limitation.
C. The requirement that all litter van patients be
secured to a gurney by restraining belts while being
loaded, unloaded and transported, for students whose
medical or physician condition does not require the
use of a gurney.
D. The requirement that all wheelchair van patients be
secured to wheelchairs while being loaded, unloaded or
transported, for students whose medical or physical
condition does not require the use of a wheelchair.
1.Sunset the transportation provisions of the bill on
January 1, 2018, or on the date the director of DHCS
executives make a declaration stating that regulations
implementing the provision described above have been
updated, whichever is later.
2.Require, no later than July 1, 2013, and annually
thereafter, DHCS to make publicly accessible an annual
accounting of all funds collected by DHCS from federal
Medicaid payments allocable to LEAs, including but not
limited to, the funds withheld under a specified
provision of law that allows up to $1.5 million to be
withheld. Require the accounting to detail amounts
withheld from federal Medicaid payments to each
participating LEA for that year. Caps one-time costs for
the development of this accounting from exceeding
$250,000.
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3.Requires DHCS to collaborate with DOE to help ensure LEA
compliance with state and federal Medicaid requirements
and to help improve LEA participation in the Medi-Cal
billing option for LEAs.
Background
LEA. The LEA Medi-Cal LBO Program was established in 1993
to provide federal financial participation (FFP) through
Medicaid reimbursement to LEAs (school districts, county
offices of education, community colleges, and university
campuses) for health-related services provided by qualified
medical practitioners to students who are enrolled in
Medi-Cal. DHCS indicates school-based health services
reimbursed by the LEA Program are primarily provided to
students with disabilities receiving special education
services through an Individualized Education Plan or
Individualized Family Service Plan.
LEAs pay for health-related services and are reimbursed for
50 percent of their costs through Medicaid FFP. LEA
services are delivered either through the LEAs (which
employ practitioners who provide the services on site) or
through local contracted practitioners. LEAs must annually
certify that the public funds expended for LEA services
provided are eligible for FFP. Subject to specified
conditions, LEA covered services can include the following:
Health and mental health evaluations and health and
mental health education;
Medical transportation;
Nursing services;
Occupational therapy;
Physical therapy;
Physician services;
Mental health and counseling services;
School health aide services;
Speech pathology services;
Audiology services; and
Targeted case management services for children with an
individualized education plan or an individualized family
service plan.
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In 2009-10, there were 391,919 LEA claims, total federal
Medicaid reimbursement was $220 million and average
reimbursement per claim was $122. Medi-Cal reimbursement
in the LEA Program has increased by 84 percent, growing
from $59.6 million in FY 2000-01 to $109.9 million in FY
2008-09.
Funding for LBO administrative costs in LEA . Funding for
DHCS administrative activities and contractor costs are
currently governed by both law and practice through the
DHCS Provider Participation Agreement. Administrative
funding is as follows:
DHCS administrative and processing services costs related
to the management of the LEA Medi-Cal LBO, not to exceed
one percent of the amount payable to the LEA submitting
the claim. This fee is in the Provider Participation
Agreement and is not codified.
DHCS audit administration and associated audit resources
costs to ensure fiscal accountability of LEA Medi-Cal LBO
and to comply with the Medicaid State Plan, not to exceed
one percent of the amount payable to the LEA submitting
the claim. The total amount collected from this fee is
capped at $650,000 through the 2010-11 Budget Act.
DHCS costs required to fund and support the program
improvement activities in existing law using a
contractor, not to exceed a program wide amount of $1.5
million annually. Existing law specifies this fee is
collected on amounts in excess of a 2000-01 baseline
amount ($60 million in practice) received by LEAs. This
fee is capped in statute at $1.5 million and is collected
through a 2.5 percent fee against individual LEA paid
claim amounts.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
LEAs: Millions of dollars in additional federal funds
reimbursing LEAs for 50% of specified expenses they
mandatorily incur under existing law.
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SUPPORT : (Verified 8/24/12)
Los Angeles Unified School District (source)
ARGUMENTS IN SUPPORT : This bill is sponsored by the
LAUSD to continue and improve the LEA Medi-Cal LBO program
improvement activities set to expire in 2013. LAUSD states
that almost $110 million in federal funds going to
California schools to support essential health and mental
health related services to students are provided through
the LBO, and since 2001, LAUSD has received $120 million of
federal funding through the program. LAUSD states this bill
makes a number of improvements to the LBO to generate
millions of dollars statewide for necessary school
transportation for students with disabilities by requiring
state rules and regulations that are overly restrictive be
better aligned with federal rules that allow for
reimbursement for transportation of students with
disabilities. Additionally, LAUSD states greater
transparency and accountability in the work performed by
DHCS is needed, as DHCS is able to withhold certain amounts
from the federal reimbursement dollars that go to schools
in order to offset DHCS administrative costs. LAUSD argues
proper accounting for these withhold amounts ensures that
schools are receiving the federal money they are due.
ASSEMBLY FLOOR : 74-0, 5/30/12
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Conway, Cook, Dickinson, Eng,
Fong, Furutani, Beth Gaines, Galgiani, Garrick, Gatto,
Gordon, Gorell, Grove, Hagman, Halderman, Hall, Harkey,
Hayashi, Roger Hern�ndez, Hill, Huber, Hueso, Huffman,
Jeffries, Jones, Knight, Lara, Logue, Bonnie Lowenthal,
Ma, Mansoor, Mendoza, Miller, Mitchell, Monning, Morrell,
Nestande, Nielsen, Norby, Olsen, Pan, Perea, V. Manuel
P�rez, Portantino, Silva, Skinner, Smyth, Solorio,
Swanson, Torres, Wagner, Wieckowski, Williams, Yamada,
John A. P�rez
NO VOTE RECORDED: Davis, Donnelly, Feuer, Fletcher,
Fuentes, Valadao
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CTW:n 8/24/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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