BILL ANALYSIS �
AB 361
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CONCURRENCE IN SENATE AMENDMENTS
AB 361 (Mitchell)
As Amended September 6, 2013
Majority vote
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|ASSEMBLY: |54-23|(May 30, 2013) |SENATE: |28-8 |(September 10, |
| | | | | |2013) |
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Original Committee Reference: HEALTH
SUMMARY : Authorizes the Department of Health Care Services
(DHCS) to submit State Plan Amendments (SPAs) or Section 1115
waiver amendment to the federal Centers for Medicare and
Medicaid Services for approval to implement a health home
program for adults, children, or both, with chronic conditions
pursuant to the federal Patient Protection and Affordable Care
Act (ACA); Specifically, this bill :
1)Authorizes DHCS to determine the model of health home,
including any entity, provider, or group of providers
operating as a health team; as a team of health care
professionals; or as a designated provider.
2)Requires, subject to federal approval for receipt of enhanced
federal matching funds, the services provided under the
program to include all of the following:
a) Comprehensive and individualized case management;
b) Care coordination and health promotion, including
connection to medical, mental health, and substance abuse
care;
c) Comprehensive transitional care from inpatient to other
settings;
d) Individual and family support, including with authorized
representatives;
e) Referral to relevant community and social services
supports, including, but not limited to connection to
housing for participants who are homeless or unstably
housed, transportation to appointments needed to manage
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health needs, health lifestyle supports, child care when
appropriate, and peer and recovery support; and,
f) Health information technology to identify eligible
individuals and link services, if feasible and appropriate.
3)Requires DHCS, if it creates a health home program, to
determine if a SPA that targets adults and that meets the
following criteria is operationally viable:
a) Current diagnoses of chronic, physical health, mental
health, or substance use disorders prevalent among frequent
hospital users; and,
b) A level of severity in conditions, as established by
DHCS based on one or more of the specified factors.
4)Requires the determination of viability in 3) above to include
consideration of whether it could be designed in a manner that
minimizes General Fund (GF) impact, whether DHCS has the
capacity to administer, and whether a sufficient provider
network exists to provide services to the target population.
5)Establishes requirements for the home health providers or
providers who plan to subcontract with health home team
members that are to be selected by DHCS for the target
population.
6)Permits health home providers eligible to serve targeted
adults through a fee-for-service or managed care delivery
system that may include supplemental payments and may allow
for county-operated and other public and private providers.
7)Requires DHCS to ensure that an evaluation is completed within
two years after implementation.
8)Requires, if DHCS determines the SPA is not operationally
viable, to notify the appropriate policy and fiscal committees
of the Legislature within 120 days of that determination, of
the reasons the program is not operationally viable and about
current efforts underway by DHCS that help to address health
care issues experienced by homeless Medi-Cal beneficiaries.
9)Authorizes DHCS to submit a SPA or waiver to target other
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adults as long as it creates a health home program for the
identified target adults.
10)Conditions implementation on the availability of federal
matching funds; requires the nonfederal share to be provided
from other than state GF, such as local or private foundation
funds unless DHCS projects that it can be implemented in a way
that results in no net increase in GF costs.
The Senate amendments :
1)Change the designation by DHCS of a lead provider from
mandatory to discretionary.
2)Add substance use disorder treatment professionals,
school-based health centers, community health workers,
community-based service organizations, a home health agency,
nurse practitioners, physician's assistants, and other
paraprofessionals, to the extent that contracting with these
providers is allowed under federal Medicaid law, to the list
that a lead provider may enter into contracts with.
3)Require health home providers to also establish noncontractual
relationships with, and provide linkages to, housing
providers.
4)Clarify that DHCS may seek Section 1115 waiver amendments, as
well as SPAs for any health home program.
5)Clarify the determination of program viability as including
whether DHCS has the capacity to administer the home health
SPA through the state, a contracting entity, a county, or
regional approach.
6)Delete the requirement that the design of other health home
elements, including provider rates specific to the target
population be in consultation with stakeholder groups.
7)Allow DHCS to revise or terminate the program if it fails to
result in reduced inpatient stays, hospital admission rates,
and emergency room visits.
8)Make other technical and clarifying changes.
FISCAL EFFECT : According to the Senate Appropriations
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Committee,
1)One-time administrative costs likely in the hundreds of
thousands of dollars to develop program guidelines, determine
eligibility standards, adopt a Medicaid SPA and select
providers. DHCS has about $650,000 in available federal
planning grant funding that may be used for some or all of
these costs.
2)Ongoing costs likely in the hundreds of thousands to millions
of dollars to oversee and administer the program. Requires
that all costs to implement the program be funded with
non-state public funds or private funds for the first eight
quarters of implementation. After the first eight quarters,
should DHCS elect to continue implementation of the program,
administrative costs would be funded at the standard federal
financial participation rate (50% GF, 50% federal funds).
3)One-time costs in the low millions of dollars to perform an
evaluation of program outcomes during the first eight
quarters. DHCS indicates that prior program evaluations
similar in scope have costs between $1 million and $5 million.
The sponsors indicate that the most likely source of funding
for the evaluation and any other administrative costs is
foundation funding. Based on the requirement in this bill
that the program only be implemented if no additional GF money
is used, this is a reasonable assumption.
4)The long-term program costs are unknown, but likely to be
cost-neutral to the state. Under the health home option in
federal law, enhanced federal financial participation at 90%
is available for the first eight quarters of program
implementation-increasing state funding that can be used for
the program. On the other hand, federal law and guidance
requires health home programs to provide more intensive
services than are typically provided by Medi-Cal. The intent
of the bill is to both improve health outcomes for
participants and to reduce overall costs, by providing more
intensive primary care and support services while reducing
costly hospitalization and emergency medical services. Based
on other programs similar in nature, including the Frequent
Users of Health Services Initiative, (Initiative) this is a
reasonable assumption. In addition, this bill requires DHCS
to continue implementation of the program after the initial
eight quarters, only if it finds that the avoided costs are
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sufficient to fully fund the ongoing costs of implementation.
COMMENTS : According to the author, this bill will allow the
state to access federal funding for "Health Home Services" for
Medi-Cal beneficiaries, while ensuring the state targets
beneficiaries with chronic medical, mental health, or substance
abuse conditions who are chronically homeless or frequent
hospital users. This bill takes advantage of the "Health Home"
option offering states 90% federal money for two years for
services such as intensive case management and care coordination
and provides options for ongoing funding should these health
homes demonstrate decreased costs. The author points out that
the Health Home option is an ideal vehicle for providing
appropriate health-related services and social service supports
to overlapping populations of people who are chronically
homeless and to people who are frequent hospital users. The
author states that many among this group experience a
combination of chronic medical, mental health, and substance
abuse conditions, as well as social issues that negatively
impact their ability to access care. The sponsor, Corporation
for Supportive Housing (CSH), states that California spends
significant Medi-Cal resources on a small group of
beneficiaries. According to data CSH reviewed, about 1,000
Medi-Cal beneficiaries who frequently used hospitals for reasons
that could be avoided with better access to care (frequent
users) incurred over $100,000 in Medi-Cal costs in 2007 alone.
CSH states that in administering the Initiative, a
foundation-funded five-year program, supporting six projects
offering community-based multidisciplinary services to frequent
users, evidence showed medical home services alone are
ineffective in addressing the needs of this population. CSH
cites a Lewin Group evaluation of the Initiative showing that
frequent users experience psychosocial complexities, like
chronic disease, mental disability, substance addiction, social
isolation, and homelessness. According to the sponsor,
intensive face-to-face services that coordinate and help
frequent users manage their care not only improved health
outcomes among these individuals, but significantly decreased
hospital costs. Medi-Cal beneficiaries participating in the
Initiative programs experienced a 60% decrease in emergency room
visits and a 69% decrease in inpatient days. Data from similar
programs across the country, several using randomized,
control-group studies, show these services save between $7,500
and $29,000 per year, per beneficiary in Medicaid costs. These
evaluations and studies also demonstrated significantly improved
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health outcomes, decreased nursing home stays, and longer life
spans among participants. The author further states that
chronically homeless people and frequent users who are homeless
have such poor health outcomes that they die, on average, 30
years younger than life expectancy in this country. For these
reasons, medical home services alone cannot sufficiently address
the myriad of barriers these populations face in accessing
appropriate care. The author points out that with the addition
of comprehensive case management, hospital discharge planning,
and connection to social services, including housing, enhanced
medical home programs have proved to reduce high-cost care among
the most vulnerable Californians. Social services
interventions, like connecting participants to housing, are a
critical step to reducing the costs and improving the care of
homeless frequent users. According to the author, programs
offering health home services to frequent users integrate
primary and behavioral health care, foster a "whole person"
approach, and reduce health disparities.
The ACA allows states to elect the health home option in their
Medicaid program and receive a 90% federal matching rate for two
years for these services. Federal law defines the individuals
eligible for health home services as individuals meeting one of
the following: 1) having at least two chronic conditions; 2)
having one chronic condition and are at risk of having a second
chronic condition; or, 3) having one serious and persistent
mental health condition. The Federal guidance defines "health
home services" as services provided by a designated provider, a
team of health care professionals operating with such a
provider, or a health team that provides: comprehensive care
management; care coordination and health promotion;
comprehensive transitional care, including appropriate
follow-up, from inpatient to other settings; patient and family
support (including authorized representatives); referral to
community and social support services, if relevant; and, use of
health information technology to link services, as feasible and
appropriate.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097 FN:
0002655
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