BILL ANALYSIS �
AB 2212
Page 1
Date of Hearing: April 30, 2014
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 2212 (Gray) - As Introduced: February 20, 2014
Policy Committee: HealthVote:19-0
Urgency: No State Mandated Local Program:
NoReimbursable:No
SUMMARY
This bill modifies provisions related to funding for Medi-Cal Early
and Periodic Screening, Diagnosis, and Treatment (EPSDT) services
to allow schools to provide and be reimbursed for services
directly. Specifically, this bill:
1)Requires the California Department of Health Care Services (DHCS)
to allow county mental health plans (MHPs) to contract with local
education agencies (LEAs) to provide services for Medi-Cal
eligible pupils under EPSDT.
2)Requires DHCS, in counties where the LEA does not have a contract
with the county MHP, to allow the MHP to obtain federal funds on
behalf of nonpublic agencies that contract with LEAs to provide
those services, as specified.
3)States that unless otherwise precluded by federal law, LEAs and
nonpublic agencies shall be reimbursed for specified EPSDT
services.
4)Defines services that a county MHP may contract for, or that a
nonpublic agency may receive federal financial participation for.
5)Requires DHCS to examine methodologies for increasing LEA
participation in the Medi-Cal program so that schools can meet
the educationally related health care needs of their pupils,
which shall include simplifying the claiming processes for
Medi-Cal billing to the extent possible.
6)Requires DHCS to seek any necessary state plan amendments or
waiver amendments to implement this section, and undertake all
necessary activities to obtain federal financial participation
for reimbursable services provided by LEAs and nonpublic
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agencies.
FISCAL EFFECT
1)One-time administrative costs to DHCS (GF/federal), likely in the
hundreds of thousands of dollars, to renegotiate a federal waiver
or develop a state plan amendment, issue guidance to clarify
responsibility for provision of services, make any necessary
adjustments to contracts with county MHPs, examine methodologies
to simplify billing, and set up a separate billing and claiming
structure for LEAs directly providing EPSDT services.
2)Significant ongoing additional administrative costs to DHCS to
oversee and certify LEAs and other providers as direct providers
of EPSDT services (GF/federal). DHCS is the single state agency
responsible for certifying all federally reimbursed Medi-Cal
expenditures. Ongoing costs would depend on how many LEAs and
other providers chose to provide EPSDT services directly.
3)If direct billing by LEAs for EPSDT services becomes widespread,
and assuming EPSDT services are paid for with Proposition 98
dollars, it could result in significant increased fiscal pressure
on Proposition 98, proportionate to the dollar amount of services
billed. The state already provides funding directly to counties
to provide EPSDT services to eligible children. If EPSDT
services were provided directly through schools without county
MHP contracts and Proposition 98 funds were used instead, the
state would be, in a sense, paying twice for those services.
Since a redirection of Prop 98 funds for EPSDT would leave less
funding available for other services, the bill would result in
cost pressure to Proposition 98.
COMMENTS
1)Purpose . According to the author, there is currently no state
policy or direction on how an LEA can seek direct access to EPSDT
mental health funding. Instead, each LEA or Special Education
Local Plan Area (SELPA) must negotiate separately with each
county MHP in order to be able to provide and be reimbursed for
EPSDT mental health services for eligible students. Each MHP
determines locally whether they want the LEA or SELPA to provide
these services. The author contends that in 2011, the state
shifted 100% of the service responsibility for the mental health
special education needs of children, but left responsibility for
EPSDT services with counties, and did not provide schools access
to EPSDT funding.
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2)Federal IDEA requirements on schools. The federal Individuals
with Disabilities Education Act (IDEA) entitles all children with
disabilities to a free, appropriate public education that
prepares them to live and work in the community, including mental
health treatment services necessary to benefit from their
education. Pursuant to IDEA, LEAs define the services students
with disabilities need in order to benefit from their education
through an individualized education program (IEP). An IEP can
include mental health services.
3)County Mental Health and EPSDT. The 2011 realignment left
counties fully responsible for providing and funding specialty
mental health services for Medi-Cal eligible individuals. Through
contracts with the state DHCS, and pursuant to a specialty mental
health waiver with the federal government, county MHPs are
responsible for funding and providing EPSDT mental health
services to Medi-Cal eligible children who meet clinical
criteria. EPSDT is a broad set of services available to Medi-Cal
eligible children, but the mental health portion of EPSDT is a
smaller set of services which include group therapy, family
therapy, case management, crisis counseling, medication, and
other medically necessary services for children with serious
mental illness.
County MHPs fulfill EPSDT obligations through direct service
provision and contracts. Many county MHPs contract with LEAs or
Special Education Local Plan Area (SELPAs) to provide certain
services. County MHPs pay 100% of the costs of services and
submit reimbursement claims to the federal government, through
DHCS, to claim federal financial participation (FFP). By claiming
FFP, counties can be reimbursed for about 50% of their costs.
Counties fund their portion of the cost of these services through
a combination of 2011 realignment funding, 1991 realignment
funding, and Proposition 63 funds.
4)Recent Shifts of Responsibility . The roles and responsibilities
of county mental health departments and LEAs to provide mental
health services to students have changed over the years. Prior
to 1984, school districts were responsible for providing all
special education services to children. In 1984, the Legislature
enacted AB 3632, which transferred responsibility for providing
mental health services to special education pupils from school
districts to county mental health departments. The intent was to
build on counties' existing expertise, and provide collaboration
between schools and public mental health. AB 3632 services were
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deemed a state-reimbursable mandate.
In 2010, during the state's recent fiscal crisis, state funding
for AB 3632 was vetoed and the mandate was suspended. AB 114
(Budget Committee), Chapter 43, Statutes of 2011 repealed
provisions of AB 3632, and realigned responsibility for mental
health services back to school districts. The federal IDEA now
serves as the statutory framework for the provision of required
services. The California Department of Education (CDE) provides
guidance to LEAs on numerous aspects of this transition,
including options LEAs have for claiming federal matching funds
for qualifying services provided to Medi-Cal eligible children.
5)LEA Billing Option Program . There is already an established
mechanism through which LEAs can provide and be reimbursed for
providing certain Medi-Cal services on a fee-for-service basis to
Medi-Cal eligible children. Through the LEA Billing Option
Program, LEAs pay for the services with local funds, then file
claims for federal reimbursement. LEAs are generally reimbursed
50 cents for every dollar spent, minus funds withheld for DHCS
administrative costs. Thus, the program is fully funded with a
combination of local and federal funds; there is no GF cost.
LEAs are only able to submit claims for services allowable under
the federally approved State Plan for the LEA Medi-Cal Billing
Option Program. There is some crossover with the list of
services provided through EPSDT. EPSDT services that are also
reimbursable through this program include psychology and
counseling, case management, mental health assessments, nursing
services, and other health services.
6)LEA Options for Providing Mental Health Services to Medi-Cal
Eligible Students . According to CDE, LEAs may use one or more of
the following options for sourcing mental health services to
Medi-Cal eligible students:
a) Provide and pay for services without seeking Medi-Cal
reimbursement.
b) Use the LEA Medi-Cal Billing Option Program. Through this
program, the LEA employs or contracts with qualified
practitioners to provide the service(s) on the IEP, pays for
the service(s), and submits a claim for reimbursement. In
order to use this option, the LEA must meet a number of
administrative conditions, including enrollment as a Medi-Cal
provider.
c) For EPSDT services, collaborate with county mental health
departments to secure the specialty mental health services
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through the county MHP. There are two ways an LEA can secure
these services:
i) Enter into a contract or Memorandum of Understanding
with the MHP for a specialty mental health service or an
array of specialty mental health services. In this case,
county MHPs provide the service and incur the cost, and bill
Medi-Cal for federal reimbursement.
ii) Request to be a certified provider of Medi-Cal
specialty mental health services from the county MHP. If
the county MHP certifies the LEA as an organizational
provider, the LEA would provide the specialty mental health
service through an LEA-qualified employee and submit a claim
to the MHP for reimbursement.
1)Opposition . California Mental Health Directors Association
(CMHDA) opposes this bill and states there is currently no
prohibition on county MHPs entering into the type of relationship
this bill seeks to mandate. According to CMHDA, the reason such
agreements are not in place is a function of local constraints
and opportunities that will not disappear because of a new
mandate. CMHDA further argues this bill restricts local control
and diminishes program effectiveness.
2)Staff Comments . Through 2011 realignment, the state has
completed the realignment of EPSDT services for Medi-Cal eligible
children to counties, providing them both the responsibility and
funding for these services. In many parts of the state, LEAs
have entered contracts or MOUs to ensure appropriate services are
provided to students who need them. It appears this bill intends
to allow LEAs who are not able to secure contracts from MHPs to
provide EPSDT services to bypass county MHPs, who are statutorily
responsible for providing and funding such services. This raises
the following issues:
a) Paying twice? The state is already providing funding
directly to counties to provide EPSDT services. If the state
were to allow LEAs to use Proposition 98 funding to directly
draw down federal reimbursement to provide EPSDT services at
the discretion of the LEA and outside of the county MHP
structure, the state may be double-paying for those services.
In effect, there would be an increase in Proposition 98
funding of EPSDT services without a decrease in county funding
for such services. The net effect would be to reduce the
funding available for other non-EPSDT Proposition 98
activities, increasing cost pressure on Proposition 98.
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b) Who pays ? This bill requires LEAs and contracting
non-public agencies to be reimbursed for all eligible EPSDT
services provided unless precluded by federal law. It does not
specify whether counties would continue to be responsible for
the federal match, whether LEAs would provide the match or
whether the match would come from state general funds or other
sources. Staff assumes since schools and their contractors
are providing the services, Proposition 98 funds would be
used.
c) Bypassing Coordinated Delivery System . Permitting LEAs to
bypass county MHPs could set a precedent for allowing
providers to bypass county mental health and other coordinated
Medi-Cal delivery systems.
d) Federal Approval Unclear . This bill would require DHCS to
renegotiate the terms of the existing specialty mental health
waiver with the federal government. It is not clear whether
the state could secure a revised waiver allowing LEAs to
directly bill for EPSDT mental health services outside of the
county MHP structure.
e) Drafting Comment . If the intent of this bill is to require
county MHPs to contract with LEAs, or to require DHCS to allow
LEAs without a county MHP contract to bill directly for EPSDT
mental health services, this bill as drafted does not
accomplish that.
Analysis Prepared by : Lisa Murawski / APPR. / (916) 319-2081