CSAC Bulletin Article

Health and Human Services 02/25/2011

AB 1066 (Pérez) – Pending
As Introduced on February 18, 2011

AB 1066, by Assembly Speaker John Pérez, has been introduced to clean up some of the technical language contained in last year’s Section 1115 Medicaid Hospital Financing Demonstration Waiver bills, SB 208 (Steinberg) and AB 302 (Pérez). 

AB 1066 clarifies some items related to the county-run coverage expansion projects, including renaming the county Coverage Expansion and Enrollment Demonstration (CEED) projects referred to in previous legislation to Low Income Health Program (LIHP). Also, under AB 1066, the state’s deadline for authorizing new LIHP’s would be July 1, 2011, and counties could opt to offer coverage to those with incomes above 133 percent of the federal poverty level (FPL) and up to 200 percent FPL. Lastly, the bill authorizes and clarifies the transfer of some funds from the previous Medicaid Hospital Financing Waiver.

CSAC is still in the process of analyzing this 83-page bill. It has not yet been assigned to a committee and cannot be heard until March 22 at the earliest. AB 1066 is an urgency measure and requires a two-thirds vote.

Budget Update – Senate Actions and Conference Committee Items

The Senate Budget and Fiscal Review Committee concluded the last of four hearings on Friday, February 18, and the joint Budget Conference Committee convened on Wednesday. Below is a summary of the Senate and Assembly’s actions that were not reported in last weeks’ Bulletin, and information about which issues are on the Conference Committee’s agenda. For a detailed copy of the Conference Committee’s Part II agenda, which includes all issues before the committee, click here. The Conference Committee is considered open, meaning the committee may discuss all budget issues – including items where the two houses are in agreement.


The Legislature approved about $1.2 billion in expenditure cuts in the
CalWORKs program, including approving the Governor’s proposal to reduce the time-limit for adults to receive assistance from 60 to 48 months. But the Legislature rejected the Governor’s proposal to apply a 48-month time limit to safety net and child-only cases. 

The Legislature also increased the Governor’s proposed $377 million cut to the county single allocation to $476 million. 

This item is not in the Conference Committee’s published agenda, but still may be discussed. 

In-Home Supportive Services (IHSS)

Both houses maintained the Governor’s overall In Home Supportive Services (IHSS) savings target of $486 million, but achieved this savings level by adopting some, but not all, of the Governor’s proposals. 

Both houses approved the proposal to require IHSS recipients to obtain a doctor’s certification of the need for personal care services to save the state $152 million General Fund. Both houses also approved the caseload adjustment savings ($83.2 million), anticipated a six percent increase in federal financial participation under the newly available federal Community First Choice Option program for savings of $121 million, and reduced IHSS Advisory Committee spending by $1.4 million, leaving $3,000 for each of the 56 IHSS Public Authorities.

The Senate also reduced domestic and other related services, but cut less than the Governor had proposed by authorizing more exceptions. The exceptions included in the Senate version would be households where the only occupants are all IHSS recipients; individuals whose housemates are neither their family nor their IHSS providers; domestic and related tasks that require universal precautions; and individuals whose housemates are not able or available to meet the recipients’ specified needs. The Senate also adopted an across-the-board reduction that would correspond to any additional savings needed to reach the $486 savings level. 

The Assembly also adopted an additional savings target of $160 million (which is now estimated to be $128 million in light of the above additional funding) and placeholder trailer bill language on proposals that may include, but are not limited to, medication compliance, nursing home intervention and diversion, and expansion of the Community Transitions Program. 

Because of these differing actions, the entire IHSS package is before the Conference Committee. 

Child Care

Since the Senate and Assembly took differing actions on the child care issue, it is now before the Conference Committee. 

The Senate rejected the Governor’s proposal to enact a 35 percent subsidy reduction for child care providers and instead chose 34.6 percent, and also adopted a 13-percent across-the-board reduction (excluding preschool) to all contractors. The Senate also reduced license-exempt payments from 80 percent to 60 percent of the market survey, eliminated eligibility for 11-12-year-olds – but exempted children in non-traditional hours of care – for a savings on $41 million, and reduced the cap for administrative expenses from 17.5 percent to 15 percent to save $15 million. 

The Assembly also enacted the 34.6 percent subsidy reduction for child care, but chose a lower 10 percent cut to all contractors, and reduced the reduced license-exempt payments from 75 percent to 70 percent of the market survey. The Assembly also approved $150 million in ongoing inter-year deferrals. 

First 5 Commissions (Proposition 10)

The Senate approved the Governor’s proposal to shift of $1.0 billion of
Proposition 10 funds from State and local reserves to Medi-Cal in 2011-12, but balked at the ongoing fund shift. The Assembly took the same action, but also eliminated the state commission for an additional savings of $89 million. Because of the differing actions taken by both houses, this item is also now before the Conference Committee. 

Mental Health Services Act (Proposition 63)

The Senate approved the shift of about $900 million in Proposition 63 funds from counties on a one-time basis to backfill for General Fund support for three mental health programs that the Governor proposes to realign to counties in 2011-12. This action conforms to the Assembly’s actions and is not in conference (although the larger issue of including mental health programs in the realignment package is before the conference committee). 

Long-Term Care Programs

Both houses adopted alternatives to the Governor’s proposal to eliminate the Multi-Purpose Senior Services Program (MSSP) and Adult Day Health Care (ADHC) programs. 

The Senate reduced MSSP by $5 million and adopted budget bill language to direct the state departments to realize more savings. The Assembly rejected any cuts to the MSSP program. As for ADHC, the Senate recast existing services by adopting both appropriations and cuts, as well as directives to seek additional federal funding and create a new $25 million program for seniors. The Assembly reduced ADHC by $28.2 million by creating a stakeholder process, streamlining administration, eliminating carry over days, and creating 10 new non-billable holidays. 

Because of these differing actions, this issue is before the Conference Committee. 

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