BILL ANALYSIS �
SB 1161
Page 1
SENATE THIRD READING
SB 1161 (Beall)
As Amended August 22, 2014
Majority vote
SENATE VOTE :32-4
HEALTH 17-0 APPROPRIATIONS 16-1
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|Ayes:|Pan, Maienschein, |Ayes:|Gatto, Bigelow, |
| |Ammiano, Bonilla, Bonta, | |Bocanegra, Bradford, Ian |
| |Ch�vez, Chesbro, Gomez, | |Calderon, Campos, Eggman, |
| |Gonzalez, Roger | |Gomez, Holden, Jones, |
| |Hern�ndez, Lowenthal, | |Linder, Pan, Quirk, |
| |Nazarian, Nestande, | |Ridley-Thomas, Wagner, |
| |Patterson, Ridley-Thomas, | |Weber |
| |Rodriguez, Wieckowski | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
| | |Nays:|Donnelly |
| | | | |
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SUMMARY : Requires the Department of Health Care Services
(DHCS), if it seeks a waiver of federal law regarding the Drug
Medi-Cal (DMC) program, to pursue federal approvals to address
the need for greater capacity in both short-term residential
treatment facilities and hospital settings providing short-term
voluntary inpatient detoxification service.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, based on the August 18, 2014 amended version, this
bill would result in:
1)Administrative costs in the range of $200,000 (General
Fund/federal funds) to DHCS to develop a waiver proposal.
DHCS is currently working on a broader demonstration waiver
related to coordinating substance use services in Drug
Medi-Cal.
2)A successful waiver proposal may increase utilization of
services by expanding supply, as discussed below, but costs
are not attributable specifically to this bill, as the
services identified in the bill are already Medi-Cal benefits
pursuant to state law.
SB 1161
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COMMENTS : According to the author, under the state's recently
approved Medi-Cal expansion, an estimated 250,000 newly eligible
Medi-Cal beneficiaries will be in need of, or will seek
substance use disorder treatment. However, the author states
that California's capacity for both inpatient medical
detoxification and short-term residential substance use disorder
treatment services is severely limited, primarily due to the
federal bar on federal financial participation (FFP) for
services provided by institutions of mental diseases (IMDs).
The author states that DHCS is currently in the process of
developing a waiver relating to the DMC program, and that this
bill would require DHCS to address provider capacity as a part
of that waiver. The author concludes by stating that this bill
would allow the Legislature to have input into the DMC waiver
sought by DHCS, and also would provide DHCS with flexibility to
address broader capacity issues with facilities providing
short-term residential treatment and voluntary inpatient
detoxification services.
As a part of the implementation of federal health care reform in
2013, the DMC benefit was expanded to require Medi-Cal to
provide coverage for additional substance use disorder services.
Effective January 1, 2014, residential substance use disorder
benefits are available to all Medi-Cal beneficiaries rather than
being limited to pregnant and postpartum women. Further,
voluntary inpatient detoxification benefits are available to the
general Medi-Cal population, and not limited to beneficiaries
with a medical condition.
Under current law, DHCS has authority to seek necessary waivers
of federal law in order to obtain FFP to implement the DMC
program. Independent of this bill, DHCS intends to submit a
waiver request to the Centers for Medicare and Medicaid Services
(CMS) to operate the DMC program as an organized delivery
system, giving state and county officials more authority to
select quality providers to meet drug treatment needs.
Additionally, in February 2014, the Director of DHCS wrote to
CMS regarding California's ability to provide the residential
substance use disorder benefit, and requested that CMS use an
interpretation of the IMD exclusion that does not rely solely on
the number of beds. DHCS requested that CMS instead allow for
flexibility to assess facilities on a case-by-case basis rather
than by number of beds alone, and recognize that under the
current interpretation of the IMD exclusion the number of beds
SB 1161
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available for Medi-Cal beneficiaries would be only 10% of the
state's total licensed capacity.
Current federal Medicaid law bars FFP for any services provided
to Medicaid beneficiaries under the age of 65 who receive care
in IMDs, which are defined as hospitals, nursing facilities, or
other institutions of more than 16 beds that are engaged in
diagnosis, treatment or care of persons with mental diseases.
Thus, under the broad IMD exclusion, no FFP would be available
for short-term substance use disorder services, or short-term
inpatient medical detoxification treatment provided to Medi-Cal
beneficiaries in an IMD.
The County Behavioral Health Directors Association of California
(CBHDA) supports this bill stating that current treatment
capacity in the state falls far short of meeting the need
Medi-Cal beneficiaries with substance use disorders, especially
for residential treatment services. CBHDA asserts that, other
than 11 perinatal programs, there are currently no licensed
residential DMC programs in California, and capacity for
inpatient medical detoxification is equally limited. Moreover,
untreated substance use disorders also result in greater
spending in higher-cost systems of care, such as hospitals and
emergency rooms. CBHDA concludes by stating that this bill
would enable the state, counties and providers to work together
to improve access to medically-necessary services for all
Medi-Cal beneficiaries in need of substance use disorder
treatment.
There is no known opposition.
Analysis Prepared by : Kelly Green / HEALTH / (916) 319-2097
FN: 0005328