BILL ANALYSIS �
-----------------------------------------------------------------
|SENATE RULES COMMITTEE | AB 2577|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
-----------------------------------------------------------------
THIRD READING
Bill No: AB 2577
Author: Cooley (D) and Pan (D)
Amended: 8/22/14 in Senate
Vote: 21
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 : Medi-Cal: ground emergency medical transportation
services:
SOURCE : California Fire Chiefs
California Metropolitan Fire Chiefs
California Professional Firefighters
DIGEST : This bill authorizes the Department of Health Care
Services (DHCS) to provide supplemental reimbursement under
existing provisions of law for the cost of paramedic services at
a rate of payment equal to cost. This bill requires DHCS to
develop and implement an intergovernmental transfer (IGT)
program in order to increase capitation payments to Medi-Cal
managed care plans for covered ground emergency medical
CONTINUED
AB 2577
Page
2
transportation services, as specified and requires the
department to implement the IGT program on January 1, 2015, or a
later date if otherwise required pursuant to any necessary
federal approvals obtained. This bill also provides that
participation in the IGTs is voluntary on the part of the
transferring entity and requires Medi-Cal managed care plans to
pay 100% of any amount of increased capitation payments made to
eligible providers for providing and making available ground
emergency medical transportation services.
Senate Floor Amendments of 8/22/14 rewrite the bill to allow
DHCS to make supplemental Medi-Cal reimbursement for paramedic
service costs, make other changes and remove the urgency clause.
ANALYSIS :
Existing law:
1. Allows ground emergency medical transportation services
providers owned by public entities (the state, a city, a
county, a city and county, a fire protection district, a
special district, a health care district or a federally
recognized Indian Tribe) that are enrolled in the Medi-Cal
program and that provide emergency medical transportation
services to Medi-Cal beneficiaries continuously through the
state fiscal year, to receive supplemental Medi-Cal
reimbursement, in addition to the rate of payment that the
provider would otherwise receive for Medi-Cal ground
emergency medical transportation services.
2. Makes participation in the program by a public ground
emergency medical transportation services provider voluntary.
Requires, if an applicable governmental entity elects to
seek supplemental reimbursement on behalf of a public ground
emergency medical transportation service provider, the
governmental entity to perform specified functions.
3. Requires the supplemental reimbursement paid to be calculated
and paid, as specified.
4. Requires DHCS to obtain approval from the Center for Medicare
and Medicaid Services (CMS) for the certified public
expenditures (CPE) payment methodology to be utilized, and
prohibits DHCS from making any payment prior to obtaining
CONTINUED
AB 2577
Page
3
that approval.
5. Requires the non-federal share of the supplemental
reimbursement submitted to CMS for purposes of claiming the
federal financial participation (FFP) to be paid only with
funds from the governmental entities that are certified to
the state.
6. Requires DHCS to promptly seek any necessary federal
approvals for the implementation of the CPEs. Permits DHCS
to limit the program to those costs that are allowable
expenditures under federal Medicaid law. Prohibits the
CPE-related provisions from being implemented if federal
approval is not obtained. Requires DHCS to submit claims for
FFP for CPEs that are allowable expenditures under federal
law.
This bill:
1. Requires DHCS to design and implement, in consultation with
eligible ground emergency medical transportation providers,
an IGT program relating to Medi-Cal managed care, ground
emergency medical transport services in order to increase
capitation payments for the purpose of increasing
reimbursement to eligible providers.
2. Makes a provider eligible for increased reimbursement under
this bill only if the provider meets specified conditions in
an applicable state fiscal year.
3. Requires DHCS to make increased capitation payments to
applicable Medi-Cal managed care plans for covered ground
emergency medical transportation services to the extent IGTs
voluntarily made by, and accepted from, an eligible provider,
or a governmental entity affiliated with an eligible
provider.
4. Requires Medi-Cal managed care plans to pay 100% of any
amount of increased capitation payments made under this bill
to eligible providers for providing and making available
ground emergency medical transportation services pursuant to
a contract or other arrangement with a Medi-Cal managed care
plan.
CONTINUED
AB 2577
Page
4
5. Requires the IGT program developed under this bill to be
implemented on January 1, 2015, or a later date if otherwise
required pursuant to any necessary federal approvals
obtained, and only to the extent IGTs from the eligible
provider, or the governmental entity with which it is
affiliated, are provided for this purpose.
6. Permits DHCS, to the extent permitted by federal law, to
implement the IGT program and increased capitation payments
on a retroactive basis as needed.
7. Makes participation in the IGT under this bill voluntary on
the part of the transferring entities for purposes of all
applicable federal laws.
8. Requires this bill to be implemented without any additional
expenditure from the state General Fund.
9. Requires, as a condition of participation under this bill,
Medi-Cal managed care plans, eligible providers, and
governmental entities affiliated with eligible providers to
agree to comply with any requests for information or similar
data requirements imposed by DHCS for purposes of obtaining
supporting documentation necessary to claim federal funds or
to obtain federal approval.
10.Enacts these provisions only if and to the extent federal
financial participation is available and is not otherwise
jeopardized, and any necessary federal approvals have been
obtained.
Background
Federal Medicaid regulations and CPEs and IGTs as the
non-federal share . Federal Medicaid regulations permit both
state and local governments to participate in the financing of
the non-federal portion of medical assistance expenditures.
CPEs are one of several mechanisms that a state may employ to
obtain FFP and to make supplemental payments to Medi-Cal
providers without cost to the General Fund (GF). Under AB 678
(Pan, Chapter 397, Statutes of 2011), state and local entities
have the option to claim FFP for the difference between the
Medi-Cal reimbursement rate and the actual cost of providing the
service. Under a CPE arrangement, government providers certify
CONTINUED
AB 2577
Page
5
their Medicaid expenditures to the state, and the state then
obtains federal reimbursement on the basis of these CPEs.
Medicaid law allows states to finance the non-federal share of
payments with CPEs as long as the funds are derived from state
or local tax revenue and are certified by units of local or
state government as eligible for federal reimbursement. The
Governor's 2014-15 Budget assumes annual supplemental
reimbursements of approximately $300 million as a result of AB
678.
Another source of funds for the state share is IGTs, which is
the source of funds authorized under this bill. IGTs are
transfers of public funds between governmental entities, such as
from a county to the state. One source of the funding used for
the transfer is local tax dollars. This bill also allows local
governmental entities the option of using IGTs as the state
share to draw down FFP in Medi-Cal. Both CPEs and IGTs allow
the state to reduce its GF spending, and allow local governments
to receive additional Medicaid funds using their own funds to
draw down federal funds.
Prior Legislation
AB 2173 (Beall, Chapter 547, Statutes of 2010) established a $4
penalty on every Vehicle Code violation. The resulting revenue
is matched by federal funds and used to make supplemental
payments for emergency air medical transportation services in
the Medi-Cal Program.
AB 511 (De La Torre of 2010) would have imposed, as a condition
of participation in the Medi-Cal Program, a quality assurance
fee (QAF) on certain ambulance transportation services
providers, to be administered by DHCS. The proceeds from the
QAF would be required to be deposited into the Medi-Cal
Ambulance Transportation Services Providers Fund (Fund). Monies
in the Fund would be available only to enhance FFP for ambulance
transportation services under the Medi-Cal Program, or to
provide additional reimbursement to, and to support quality
improvement efforts of, ambulance transportation services
providers, including increased reimbursement for and improvement
of the quality of the provision of ALS services, as defined. AB
511 was held on the Senate Appropriations suspense file;
subsequently referred to Senate Health and Senate Revenue and
Taxation Committees. At the request of the author, the bill was
CONTINUED
AB 2577
Page
6
not heard in a policy committee again.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
Unknown with recent amendments
SUPPORT : (Verified 8/15/14) (Unable to reverify at time of
writing)
California Fire Chiefs (co-source)
California Metropolitan Fire Chiefs (co-source)
California Professional Firefighters (co-source)
Association of California Healthcare Districts
Burbank Fire Department
California Metro Fire Chiefs
California Special Districts Association
California State Firefighters Association
City and County of San Francisco Mayor, Edwin Lee
Cosumnes Community Services District Fire Department
Culver City
Dinuba Fire Department
Gilroy Fire Department
Hayward Fire Department
Mill Valley Fire Department
Ontario Fire Department
Orange Fire Department
Rialto Fire Department
Sacramento Metropolitan Fire District
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, 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, Yamada, Atkins
CONTINUED
AB 2577
Page
7
NO VOTE RECORDED: Donnelly, Frazier, Vacancy
JL:AL:d 8/25/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****
CONTINUED