BILL ANALYSIS �
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THIRD READING
Bill No: AB 1552
Author: Lowenthal (D), et al.
Amended: 8/4/14 in Senate
Vote: 27 - Urgency
SENATE HEALTH COMMITTEE : 8-0, 6/18/14
AYES: Hernandez, Morrell, Beall, DeSaulnier, Evans, Monning,
Nielsen, Wolk
NO VOTE RECORDED: De Le�n
SENATE APPROPRIATIONS COMMITTEE : 5-0, 8/14/14
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NO VOTE RECORDED: Walters, Gaines
ASSEMBLY FLOOR : 77-0, 5/28/14 - See last page for vote
SUBJECT : Community-based adult services: adult day health
care center
SOURCE : California Association of Adult Day Services
DIGEST : This bill requires Community-Based Adult Services
(CBAS) to be a Medi-Cal benefit, and to be included as a covered
service in contracts with all Medi-Cal managed health care
plans, with standards, eligibility criteria, and provisions that
are at least equal to those contained in the Special Terms and
Conditions of the state's "Bridge to Reform" Section 1115
Medicaid Demonstration Waiver.
ANALYSIS :
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Existing law:
1.Establishes the Medi-Cal program, administered by the
Department of Health Care Services (DHCS), under which health
care services are provided to qualified, low-income persons.
2.Excludes, to the extent permitted by federal law, adult day
health care (ADHC) from coverage under the Medi-Cal program.
3.Authorizes DHCS to implement a one-year moratorium on the
certification and enrollment into the Medi-Cal program of new
ADHC centers on a statewide basis, or within a geographic
area, with specified exemptions from the moratorium. Permits
the Director of DHCS to extend this moratorium, if necessary,
to coincide with the implementation date of the ADHC centers
waiver.
4.Requires DHCS, to the extent that federal financial
participation is available, and pursuant to a demonstration
project or waiver of federal law, to establish specified
Medi-Cal pilot projects in up to eight counties, and requires
long-term services and supports (LTSS) to be available to
beneficiaries residing in counties participating in those
pilot projects. Includes CBAS within the definition of LTSS.
This demonstration project is known as the Coordinated Care
Initiative (CCI).
5.Requires, as part of the CCI, all Medi-Cal LTSS to be services
covered under Medi-Cal managed care health plan contracts and
available only through plans to beneficiaries residing in
counties participating in the demonstration, with specified
exemptions.
This bill:
1. Requires, notwithstanding the operational period of CBAS as
specified in the Special Terms and Conditions (STCs) of
California's Bridge to Reform Section 1115 Medicaid Waiver,
and notwithstanding the duration of the CBAS settlement
agreement, CBAS to be a Medi-Cal benefit, and to be included
as a covered service in contracts with all managed health
care plans, with standards, eligibility criteria, and
provisions that are at least equal to those contained in the
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STCs of the demonstration waiver on the date this bill is
signed into law.
2. Defines "CBAS" as an outpatient, facility-based program,
provided pursuant to a participant's individualized plan of
care, as developed by the center's multidisciplinary team,
that delivers nutrition services professional nursing care,
therapeutic activities, facilitated participation in group or
individual activities, social services, personal care
services, and, when specified in the individual plan of care,
physical therapy, occupational therapy, speech therapy,
behavioral health services, registered dietician services,
and transportation.
3. Prohibits any modifications to the CBAS program that differ
from the STCs unless they offer more protections or permit
greater access to CBAS.
4. Requires CBAS providers to be licensed as ADHCs and
certified by the Department of Aging (CDA) as CBAS providers,
and to meet the standards specified in existing law and
regulation.
5. Requires CBAS providers to meet all applicable licensing and
Medi-Cal standards, and to provide services in accordance
with existing regulations.
6. Requires CBAS providers to comply with the provisions of
California's Bridge to Reform Section 1115 Medicaid Waiver
and any successor demonstration.
7. Requires, in counties where DHCS has implemented Medi-Cal
managed care, CBAS to be available as a Medi-Cal managed care
benefit, except for individuals who are not qualified for, or
who are exempt from, enrollment in Medi-Cal managed care.
For these individuals, CBAS is required to be provided as a
fee-for-service benefit.
8. Requires CBS to be provided as a fee-for-service Medi-Cal
benefit to all eligible Medi-Cal beneficiaries who qualify
for CBAS in counties that have not implemented Medi-Cal
managed care.
9. Defines "chronic mental disorder" to mean that the
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beneficiary has one or more of the diagnoses included in the
most recent version of the Diagnostic and Statistical Manual
of Mental Disorders published by the American Psychiatric
Association.
10.Defines "developmental disability" to mean a disability that
originates before the individual reaches 18 years of age,
continues, or can be expected to continue, indefinitely, and
constitutes a substantial disability for that individual, as
defined.
11.Requires CBAS to be available to beneficiaries who meet or
exceed the medical necessity criteria established in existing
law and for whom one of the following criteria is present:
A. The beneficiary meets or exceeds the "Nursing Facility
Level of Care A" criteria as set forth in the California
Code of Regulations.
B. Both of the following apply to the beneficiary:
(1) The beneficiary has a diagnosed organic,
acquired, or traumatic brain injury or a chronic mental
disorder, or both.
(2) The beneficiary needs assistance or supervision,
as described.
C. The beneficiary needs assistance or supervision with at
least two of the following:
(1) Bathing.
(2) Dressing.
(3) Feeding himself/herself.
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(4). Toileting.
(5) Ambulating.
(6) Transferring himself/herself.
(7) Medication management.
(8) Hygiene.
D. The beneficiary needs assistance or supervision with at
least one of the activities identified in #C) above and
needs assistance with at least one of the following:
(1) Money management.
(2) Accessing community and health resources.
(3) Meal preparation.
(4) Transportation.
E. The beneficiary has a moderate to severe cognitive
disorder such as dementia, including dementia
characterized by the descriptors of, or equivalent to,
Stages 5, 6, or 7 of the Alzheimer's type.
F. The beneficiary has a mild cognitive disorder such as
dementia, including dementia of the Alzheimer's type, and
needs assistance or supervision with at least two of the
activities described in #C) above.
G. The beneficiary has a developmental disability.
12.Implements this bill only if federal financial participation
is available.
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13.Makes legislative findings regarding Californians support for
living in their home or a community-based setting free from
unnecessary institutionalization, the aging American
population, the history and services provided by ADHC
centers, the cost of ADHC services as compared to nursing
home costs, the creation of CBAS, the need to continue CBAS
and to codify CBAS so that disabled and frail Californians
who rely on adult day health programs are able to remain
independent and free of institutionalization as long as
possible.
Background
ADHC and CBAS . All state Medicaid programs have the option to
provide and receive federal financial participation for optional
services, in addition to those services required by federal law.
ADHC was an optional community-based day program in
fee-for-service Medi-Cal for low-income elders and younger
disabled adults who are at risk for being placed in a nursing
home. ADHC services included physical therapy, occupational
therapy, speech therapy and recipient transportation to and from
the ADHC facility. Eligibility was based on an individual's
functional limitations, severity of chronic or post-acute health
conditions, and risk for nursing home placement. ADHC services
were provided at licensed ADHC centers, and included medical
services, nursing care, meals, social and therapeutic
activities, and transportation. ADHC centers could be both
for-profit and not-for-profit.
Governors Schwarzenegger and Brown both proposed the elimination
of ADHC as an optional Medi-Cal benefit. In March 2011, Governor
Brown signed AB 97 (Committee on Budget, Chapter 3, Statutes of
2011) into law to eliminate ADHC as a benefit in Medi-Cal,
subject to approval by the federal Center for Medicare and
Medicaid Services (CMS), in order to achieve General Fund
savings and because of concerns over fraud in the program. In
June 2011, the Legislature passed AB 96 (Assembly Budget
Committee), which authorized the creation of the Keeping Adults
Free from Institutions (KAFI) program to replace ADHC. In July
of 2011, the Governor vetoed AB 96, and instead proposed that
his Administration will develop an alternate plan to transition
ADHC participants to other services. In August 2011, DHCS
presented its plan for transitioning ADHC participants to other
services, which included the enrollment of ADHC participants in
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Medi-Cal managed care. From mid-August through October of 2011,
DHCS began implementing the managed care portion of its
transition plan.
In June 2011, seven plaintiffs filed a class action lawsuit in
the U.S. District Court on behalf of ADHC participants. The
lawsuit, Esther Darling, et al. v. Toby Douglas, et al., was
brought against DHCS to block the elimination of ADHC as an
optional Medi-Cal benefit, as the plaintiffs argued the changes
would place them at risk of unnecessary institutionalization,
violated their due process rights, and that the restrictive
eligibility criteria in a previous ADHC bill violated Medicaid
requirements.
In November 2011, DHCS announced that it had reached a
settlement with plaintiffs to resolve the lawsuit. Under the
terms of the settlement, ADHC will be eliminated and replaced by
a new program called CBAS, which would be included under the
state's Medicaid Demonstration waiver known as California's
Bridge to Reform. CBAS was defined in the settlement as an
outpatient facility based program that delivers skilled nursing
care, social services, therapies, personal care,
family/caregiver training and support, meals and transportation
to eligible beneficiaries. In January 2012, the Court granted
final approval of the settlement, which lasts for 30 months or
until August 2014. Medi-Cal managed care plans began covering
CBAS in mid- to late 2012.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Ongoing costs of about $380 million per year to continue to
provide CBAS in the counties in which this program is
currently operating (General Fund and federal funds). As
noted below, the state is currently offering CBAS under a
court order that is set to expire in August of 2014. CBAS is
an optional benefit that states are not required to offer
under federal law. In the absence of this bill, the state
could elect to discontinue the program after August 2014
(although the state may be subject to further legal action if
it did so).
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Potential cost savings due to reduced institutionalization and
improved clinical outcomes for participating Medi-Cal
beneficiaries (General Fund and federal funds). The intent of
offering CBAS is to allow Medi-Cal beneficiaries who are at
risk of being institutionalized (for example, placement in a
skilled nursing facility) due to physical illness and
cognitive impairment to remain in the community. To the
extent that CBAS actually keeps a Medi-Cal beneficiary out of
institutional care, this benefit will almost certainly reduce
state spending. Whether or not the overall program reduces
state spending will depend, in part, on whether the benefit is
provided to beneficiaries who are likely to be
institutionalized and the clinical success of the benefit in
preventing institutionalization.
Unknown costs to expand CBAS statewide (General Fund and
federal funds). Prior to March 2012, CBAS were limited by the
availability of providers. At that time, 26 counties had an
ADHC provider (the predecessor to CBAS). Existing law places
a one-year moratorium on new CBAS providers, which can be
extended by the DHCS. This bill does not extend the
moratorium on providers. If DHCS relaxes the moratorium on
new providers, the CBAS could become available in the 32
counties that do not currently have a provider. However, the
remaining 32 counties are generally rural counties with small
populations. Given the low population densities of those
counties, it is not clear whether the operation of an ADHC
could be financially viable or whether there will be
significant demand for those services, given long travel times
to and from such a center.
Unknown costs to the Department of Public Health (DPH) for
licensing of additional ADHCs (Licensing and Certification
Fund). To the extent that new ADHCs open to provide CBAS,
those facilities would be licensed by DPH. All licensing and
enforcement costs would be reimbursed by fees.
Ongoing costs of about $3.3 million per year to certify that
CBAS providers are meeting Medi-Cal program criteria and
requirements by the Department of Aging (General Fund and
federal funds). Under an interagency agreement with DHCS, the
Department of Aging is responsible for certifying that
providers meet all the applicable Medi-Cal program
requirements.
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SUPPORT : (Verified 8/15/14)
California Association of Adult Day Services (source)
AARP
AFSCME
Alzheimer's Association, California Chapter
Association of Regional Center Agencies
California Alliance for Retired Americans
California Commission on Aging
California Medical Association
California Primary Care Association
Casa Pacifica Adult Day Health Care Center
Congress of California Seniors
County Welfare Directors Association of CA
Eskaton Adult Day Health Center
LeadingAge California
MIKKON Adult Day Health Care Center
MSSP Site Association
National Association of Social Workers
National Health Law Program
Sherman Oaks/East Valley Adult Center
State Independent Living Council
OPPOSITION : (Verified 8/15/14)
Department of Finance
Department of Health Care Services
ARGUMENTS IN SUPPORT : The California Association for Adult
Day Services writes in support that as California implements the
Affordable Care Act and moves to managed, outcome-driven care,
it is essential that integrated community-based programs such as
CBAS are key partners in the changing systems, and that they
expand to meet the growing needs of California's aging
population.
ARGUMENTS IN OPPOSITION : The Department of Finance (DOF) and
DHCS oppose this bill because they it is unnecessary. DOF
states that DHCS can establish the CBAS program administratively
and has submitted a CBAS Waiver Amendment to continue CBAS
benefits beyond the existing sunset date. DHCS states the CBAS
Waiver Amendment was submitted to the Centers for Medicare and
Medicaid on June 13, 2014, after an extensive six month
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stakeholder engagement process.
ASSEMBLY FLOOR : 77-0, 5/28/14
AYES: Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom,
Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian
Calderon, Campos, Chau, Ch�vez, Chesbro, Conway, Cooley,
Dababneh, Dahle, Daly, Dickinson, Eggman, Fong, Fox, Frazier,
Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gorell,
Gray, Grove, Hagman, Hall, Harkey, Roger Hern�ndez, Holden,
Jones, Jones-Sawyer, Levine, Linder, Logue, Lowenthal,
Maienschein, Mansoor, Medina, Melendez, Mullin, Muratsuchi,
Nazarian, Nestande, Olsen, Pan, Patterson, Perea, John A.
P�rez, V. Manuel P�rez, Quirk, Quirk-Silva, Rendon,
Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Wagner,
Waldron, Weber, Wieckowski, Wilk, Williams, Atkins
NO VOTE RECORDED: Donnelly, Yamada, Vacancy
JL:e 8/17/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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