BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
SB 21 (Liu and Alquist)
Hearing Date: 5/26/2011 Amended: 3/25/2011
Consultant: Katie Johnson Policy Vote: Health 7-2
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BILL SUMMARY: SB 21 would require the Department of Health Care
Services (DHCS) to work with stakeholders to develop or identify
a long-term care assessment tool by July 1, 2013, that would
identify eligible individuals' long-term care needs. It would
also require counties to establish a long-term care case
management program commencing January 1, 2012, for persons who
are Medi-Cal recipients or enrolled in both Medi-Cal and
Medicare and residing in, applying for admission to, or at
imminent risk of being placed in a long-term health care
facility. The bill would make various findings and declarations
and state intentions of the Legislature.
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Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13 2013-14 Fund
Stakeholder process to likely hundreds of thousands
annuallyGeneral/*
develop or select long-term Federal
care assessment tool; ongoing
program oversight
Development and likely hundreds of
thousandsGeneral/*
procurement of long-term one-time Federal
care assessment tool
Implementation of county likely hundreds of General/*
case management program millions of dollars annually
Federal
Increased reimbursement and unknown, but likely in the
General/*
utilization of home and millions of dollars annually
Federal
community based services
Potential future likely in the millions of
dollars General/*
cost avoidance to the extent that cost is
containedFederal
and avoided by treating people in
a more cost-effective setting
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*In general, costs would be shared 50 percent General Fund and
50 percent federal funds for all staff work.
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STAFF COMMENTS: SUSPENSE FILE.
Long-Term Care Assessment Tool
This bill would require the Department of Health Care Services
(DHCS) to develop a uniform long-term care services assessment
in collaboration with stakeholders no later than July 1, 2013.
To develop the tool, the department would likely need additional
personnel to staff the stakeholder workgroup and technical
expertise in developing the assessment tool software at a cost
likely in the hundreds of thousands of dollars annually through
July 1, 2013.
Legislative Intent
This bill would make findings and declarations that 1)
illustrate the need for a practical assessment of barriers to
returning home for seniors and persons with disabilities who
reside in institutional care, 2) state that California needs a
strategic plan for long-term care services, 3) state that
in-home supportive services and adult day health care are
examples of services that the state should prioritize with
stable and adequate funding, 4) state that California's
long-term care services are an uncoordinated patchwork of
programs rather than a coordinated continuum of care, and 5)
state the Legislature's intent to establish an integrated system
of long-term care that will enable adults with long-term care
needs to remain at home whenever possible and live in the least
restrictive environment with autonomy, dignity, and choice
whenever possible.
County Case Management Program
This bill would create a county-based, comprehensive long-term
care program that would provide an assessment of an individual's
long-term care services needs and
ongoing case management to ensure that the individual would have
every opportunity to reside at home or in another
community-based setting instead of in a long-term care facility.
Individuals who are Medi-Cal recipients or enrolled in both
Medi-Cal and Medicare, also known as dual eligibles, and
residing in, applying for admission to, or at imminent risk of
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being placed in a long-term health care facility would be
eligible for the program.
California has approximately 1.1 million dual eligibles and
about 380,000 seniors and persons with disabilities (SPDs) who
are Medi-Cal enrollees. DHCS will commence mandatory enrollment
of SPDs into Medi-Cal managed care plans June 1, 2011. The case
management program would begin January 1, 2012, a year and a
half prior to the development and implementation of the
long-term care assessment tool. It is unclear how effective and
how uniform case management would be without the aid of the
tool. Since the assessment would be completed manually, and
would therefore take much longer, until the development of the
tool, the first year and half of costs could be much greater
than ongoing program costs.
Although it is unknown how many people would be eligible for
these transition and case management services, if 1 percent of
these individuals, approximately 150,000 people, were eligible
for this program, it could cost approximately $150 million -
$350 million annually for case management services, assuming
salaries of $100,000 and caseloads of 40 - 80 consumers. Case
managers would likely be either specially trained staff or
social workers. Costs would be in the billions of dollars if
even 5 percent of those individuals took part in the program.
Costs would likely be shared 50 percent federal funds and 50
percent General Fund.
This bill could also cause a minor increase in costs to the
Office of Statewide Health Planning and Development (OSHPD) for
data collection and storage and to the Department of Finance
(DOF) to develop program baseline and savings estimates.
Potential Future Program Cost Avoidance
This bill specifically directs DOF to estimate savings realized
from placing individuals who would otherwise be placed in or
transferred to a licensed long-term health care facility in a
home or in a less restrictive environment. To the extent that
projected costs of serving beneficiaries in long-term care
facilities is shown to be more than the program costs of
maintaining an individual in a community placement and that the
program is successful in placing and maintaining program
participants in their lower cost setting, there could be
significant cost avoidance. However, the program would need to
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be implemented, functional, and successful before any cost
avoidance could be accurately determined.
Existing State Home and Community-Based Programs
Within California, the Departments of Aging (CDA), Health Care
Services (DHCS), Developmental Services (DDS), Mental Health
(DMH), Rehabilitation (DOR), Social Services (DSS), and Veterans
Affairs (DVA) each directly administer long-term care programs
such as Money Follows the Person (MFP), Program of All-Inclusive
Care for the Elderly (PACE), In-Home Supportive Services (IHSS),
and a DDS Home and Community-Based Services waiver. Many of
these programs conduct their own separate assessments and have
different eligibility requirements, limits on caseload, and
different streams of federal, state, and local funding. Although
it could be possible that DHCS and counties, in implementing
this bill, could utilize and build upon and create efficiencies
across current programs, streams of funding, and service
delivery systems, it is unknown both operationally and fiscally
how existing programs would interface with this bill's required
long-term care assessment tool and case management program.
Additionally, on March 23, 2010, the President signed the
Patient Protection and Affordable Care Act (Public Law 111-148),
as amended by the Health Care Education and Reconciliation Act
of 2010 (Public Law 111-152) (ACA). The ACA provides states
opportunities to expand their offerings of home and
community-based services, including an option that permits state
Medicaid agencies to apply to the federal government for a state
plan amendment or waiver known as the Community First Choice
Option (CFC); it would be available October 1, 2011.
Preliminary federal guidance was issued February 25, 2011, and
had a public comment period that ended April 26, 2011. Under the
state Medicaid plan option or a waiver, it would offer the 6
percent enhanced FMAP rate-for California, it would be 56
percent federal funds and 44 percent General Fund-for CFC
services under "person-centered plans" that would permit
individuals to decide how services would be provided to promote
independence. The services provided would be similar in scope
and purpose to California's IHSS program, but the
person-centered plan would be similar to the Individual Program
Plan developed for persons with developmental disabilities by
DDS. States would also have the option to cover services related
to transitioning an individual from an institutional setting to
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the community, such as security deposits and transitional care.
To implement this option and to receive the enhanced FMAP, the
state would need to develop, in consultation with stakeholders,
a state plan amendment and receive federal approval. The ACA
also extends the Money Follows the Person (MFP) grant program
for 5 years, until 2016.
DDS Case Management
One example of an existing system of a consumer-centered
assessment, plan, case management system, and service
procurement is the regional center system that serves
Californians diagnosed with developmental disabilities as
administered by DDS. The regional center system is made up of 21
nonprofit regional centers that contract with DDS to initially
assess an individual's needs, develop an individual plan that
outlines the local services that an individual may need to live
in his/her community, purchase those necessary services, and
provide ongoing case management to the individual.
DDS and DHCS jointly administer a Section 1915(c) Home and
Community Based Services (HCBS) waiver which provides consumers
who are eligible for both Medi-Cal and DDS an array of home and
community based services, such as home health, respite, skilled
nursing, and transportation, in order to enable them to live in
a placement outside of a long-term care facility. Waiver
enrollment is capped at 90,000 consumers for October 1, 2009, to
September 31, 2010, and is capped at 95,000 for October 1, 2010,
through September 31, 2011. The DDS November 2010 Estimate
estimates that the department will spend approximately $2
billion total funds in FY 2011-2012 for staff and purchase of
services for the HCBS waiver.