BILL ANALYSIS Ó
SENATE COMMITTEE ON VETERANS AFFAIRS
Senator Ben Hueso, Chair
BILL NO: AB 614 HEARING DATE: 6/24/14
AUTHOR: Chávez
VERSION: 6/17/14
FISCAL: Yes
VOTE: Majority
SUBJECT
Veterans Homes: members with VA ratings of 70 percent or higher
for service-connected conditions.
DESCRIPTION
Existing law (state and federal):
1.Provides for the establishment and operation of the Veterans
Home of California, within the California Department of
Veterans Affairs (CalVet), at various sites for aged and
disabled veterans and their nonveteran spouses, who meet
certain eligibility requirements.
2.Requires members (residents) of the homes to pay fees and
charges, as determined by CalVet.
3.Provides for the homes to receive federal per diem payments
from the U.S. Department of Veterans Affairs (VA), which help
compensate the state veterans homes for the costs of care.
4.Provides for the homes to receive federal "aid and attendance"
payments from the U.S. Department of Veterans Affairs (VA) on
behalf of eligible veterans, who need levels of care exceeding
provision of basic domiciliary services.
This bill:
Conforms state law to federal regulations which:
1.Eliminate VA aid and attendance payments for veterans, who are
VA-rated at 70 percent or higher disabled due to a
service-connected condition, because the VA pays a much higher
super per diem rate that is four to five times more than the
regular per diem rate; and
2.Require a state home, when receiving the super per diem rate
for veteran VA-rated as 70 percent or higher
service-connected, not to charge a member fee to that veteran,
because the super per diem rate is deemed to cover all costs
of state care to that veteran.
BACKGROUND
California state veterans homes
CalVet's Veterans Homes Division provides rehabilitative,
residential medical care and services in a homelike environment
for all veterans (and eligible veteran spouses) residing in the
State's eight veterans homes, which are located in Barstow,
Chula Vista, Fresno, Lancaster. Redding, Ventura, West Los
Angeles, and Yountville. As of early 2013, more than 1,700
members resided in these veterans homes.
Levels of Care
The eight campuses offer different combinations of the following
levels of care that generate increasing levels of cost:
Independent living/domiciliary care (Barstow, Chula
Vista, Yountville):
This level of care is for residents able to perform
activities of daily living with, at most, minimal
assistance. Non-nursing employees provide limited
supervision. Residents have access to all of the Home's
services, activities, and medical care. Individuals can
transfer to higher levels of care as needed. Independent
living is also referred to as Domiciliary by CalVet and
the USDVA.
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Residential care/assisted living (All homes except
Barstow):
Residential Care Facilities for the Elderly (RCFE) are
available for residents who require minimal assistance
and supervision with some activities of daily living.
RCFE services may include care by licensed nurses. In the
future, memory care programs may be established within
the RCFEs.
Intermediate care (Barstow, Yountville):
This level is for residents who often require licensed
nursing assistance with medications and treatments, and
generally require unlicensed nursing assistance with
several daily living activities.
Skilled nursing care (Barstow, Chula Vista, Fresno,
Redding, West LA, Yountville):
This level provides 24-hour services of licensed nurses
and certified nursing assistants, and is more
comprehensive than intermediate care. Skilled nursing
residents have greater access to rehabilitation
therapies, nursing care, pharmacy management, structured
activities and clinical dietary services. May provide a
memory care program.
Home funding and member fees
Funding for the annual operating expenses of the veterans homes
comes from the State's General Fund, and any additional revenues
that the Veterans Homes Division receives are subsequently
remitted to the General Fund. These additional sources of
revenue primarily consist of reimbursements from five sources:
1. Medicare, a federally funded program which pays hospital
inpatient and outpatient care, and some skilled nursing
care;
2. Medi-Cal, funded by the federal and state governments,
which pays skilled nursing facility daily rates and various
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healthcare costs;
3. Member fees, which veterans' home residents pay in
accordance with their income and level of care;
4. So-called "aid and attendance," which are federal
payments for veterans who need personal care assistance;
and
5. The U.S. Department of Veterans Affairs (VA), which pays
a per diem rate for each veteran in the homes.
Member fee amounts are determined by CalVet, and that
determination takes into account those times when the costs of a
resident's care (e.g. dental care, acute medical care, etc.)
exceed the basic fee.
Under existing law, the total of the individual member's fees
and charges for any fiscal year shall not be greater than:
Forty-seven and one-half percent of the member's annual
income for domiciliary care.
Fifty-five percent of the member's annual income for
residential care for the elderly or assisted living.
Sixty-five percent of the member's annual income for
intermediate care.
Seventy percent of the member's annual income for
skilled nursing care.
Most veteran members are eligible to have the federal VA make
per diem payments to the state that help reduce costs to state
taxpayers. The federal VA manages the "State Veterans Home
Program," a grant program that provides federal assistance to
states by (a) participating in a percentage of the cost of
construction of state veterans homes and (b) paying per diem for
ongoing provision of care to eligible veterans residing in
federally recognized state veterans homes. The per diem is the
approved daily rate established by the VA to reimburse state
homes for providing specified levels of care to eligible
veterans.
The federal "Basic State Home Per Diem Rates" for Fiscal Year
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2014 are as follow:
Adult Day Health Care: $79.96 per day
Domiciliary: $43.32 per day
Nursing Homes: $100.37 per resident per day
Veterans who are VA-rated as 70 percent or more disabled are
eligible for enhanced per diem rates, based upon the location of
their state veterans home. For example, Yountville receives a
$536.58 enhanced per diem and Barstow receives a $431.24
enhanced per diem.
Aid and attendance payments are additional monetary allowances
paid by the VA to veterans, who require the aid and attendance
of another person. The intent is to assist a veteran, who has a
physical or mental impairment, loss of coordination, or
conditions affecting the ability to dress and undress, to feed
oneself, to attend to sanitary needs, and to keep oneself
ordinarily clean and presentable. The payments are in addition
to any other veterans pension the individual may have earned.
Under federal regulations, if a 70 percent plus veteran is
eligible for the super per diem, the VA will pay either aid and
attendance or the enhanced per diem, whichever is higher. Right
now the super per diem for Yountville is $540.62 a day
($16,218.60 a month). The VA aid and attendance is $704 a month.
Therefore, the VA would pay only the per diem and not pay the
aid and attendance at all.
In the 2009-10 Budget Act, the Legislature instituted a major
General Fund policy adjustment that affected home resident fees.
Specifically, it increased the amount of fees collected from
home residents from $17.2 million to $20 million - an increase
of $2.8 million.
Previously, residents paid fees based on a percentage of their
income, up to a dollar cap, with the percentage and cap
increasing as the level of care increases. The 2009 budget
proposal increased resident fees by:
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Removing the dollar caps;
Increasing the percentage for the Residential Care for
the Elderly (RCFE); and
Revising the fee structure for nonveteran spouses to
more accurately reflect their share of costs because they
are ineligible for the federal per diem payments.
VA Disability Ratings
The federal VA administers claims and provides compensation for
injuries or diseases that happened while on active duty, or were
made worse by active military service. The amount of basic
benefit paid varies depending on the severity of the condition.
Additional amounts may be paid if the veteran has: very severe
disabilities or loss of limb(s); a spouse, children, or
dependent parents; or seriously disabled spouse. The VA makes a
determination about the severity of a disability based on the
evidence the veteran submits as part of a claim, or that VA
obtains from the veteran's official military records.
The VA rates disability from 0 percent to 100 percent in
10-percent increments. The 10-percent rating is the lowest
rating for which compensable income is awarded. A veteran with a
100-percent rating will have one or more disabilities that
significantly interfere with normal life functions. A veteran
with a 0-percent rating may have a service-connected condition,
but it doesn't interfere with normal life functions. The
majority of disabled veterans rated at 10 percent, 20 percent,
or 30 percent. Over many years, a veteran's disability claim may
require re-ratings. The re-ratings can be caused by changes in
law, advances in medical knowledge, or fluctuations in the
veteran's physical or mental condition. An individual's
percentage rating may go up or down.
COMMENT
Committee staff comments :
1.Federal regulations (CFR Title 38, Chapter 1, Part 51 Subpart
C, Section 51.41) govern how the VA and a state veterans home
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enter into a contract or provider agreement through which the
VA will make payments, including per diem payments, toward
each eligible veteran's care. The regulations state that
eligible veterans are those who:
a. Are in need of nursing home care for a VA adjudicated
service-connected disability, or
b. Have a singular or combined rating of 70 percent or more
based on one or more service-connected disabilities or a
rating of total disability based on individual
unemployability and are in need of nursing home care.
The regulations also provide: "The State home shall not charge
any individual, insurer, or entity (other than VA) for the
nursing home care paid for by VA under a VA provider
agreement."
CalVet understands this to mean that they may not charge
member fees of any resident veteran with a 70 percent or
higher VA rating. The justification for the federal exemption
rule is that, for those veterans, the federal VA pays the
"super per diem" that is 4-5 times greater than the normal per
diem, and that should be considered sufficient to pay for a 70
percent-plus veteran's full cost of care. They have been
administratively complying with this regulation, but believe
they need a state statute exempting 70 percent-plus veterans
from the statutory requirement to pay member fees. This bill
would conform state law with federal regulations by modifying
MVC § 1012.3.
2.This bill also amends MVC § 1012.2, which requires that the
federal VA's aid and attendance payments - for a veteran
residing in a state veterans home - ends up in the hands of
the state home to help ensure that state taxpayers are
partially compensated for the cost of care to the veteran
resident. Under federal regulations, when a 70 percent-plus
veteran receives the super per diem payments, the aid and
attendance payments are stopped. AB 614 modifies § 1012.2 to
reflect the impact of the federal policy.
Related Legislation
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SB 1440 (Wolk, pending, 2014) alters the fee structure for
nonveteran spouses residing in state veterans homes. Requires
nonveteran spouses to pay the same fees and charges as paid by
the veteran members of the home and subject to the same
prohibitions.
AB 488 (Cook, held Assembly Approps, 2011) : Identical to SB
1440 (Wolk, 2014).
POSITIONS
Sponsor: Author.
Support: None on file.
Oppose: None on file.
Analysis by: Wade Cooper Teasdale
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