Hospital Funding Package Heading to Governor’s Desk

The Legislature fast-tracked two measures related to hospital funding and the state budget this week. SB 90 by President pro Tempore Darrell Steinberg and AB 113 by Assembly Member Bill Monning cleared both houses of the Legislature and will be sent to the Governor for action.

SB 90 contains provisions related to hospital seismic safety requirements, a hospital provider fee, and hospital rates. The measure permits all hospitals that have received an extension of the hospital seismic safety standards requirement to 2013, to also request an additional extension of up to seven years, for a hospital building that it owns or operates. The Office of Statewide Health Planning and Development (OSHPD) may grant the extension subject to the hospital meeting the following milestones.

SB 90 enacts a 6-month hospital provider fee and Medi-Cal supplemental payment from January 1, 2011 through June 30, 2011.

The measure also makes inoperative various rate reductions and rate freezes:

• Makes inoperative the freeze, enacted by SB 853 (Committee on Budget and Fiscal Review), Chapter 717, Statutes of 2010 (Health Budget Trailer Bill) on any inpatient rate increases negotiated by private hospitals by the California Medical Assistance Commission (CMAC), restores the rate retroactively and adds a requirement that DHCS explore other avenues for achieving rate stability needed for transition to a Diagnosis-Related Groups (DRG) methodology;
• Makes inoperative, from the effective date of this bill, the 10 percent reduction in Medi-Cal fee for service (FFS) interim payments for inpatient services that was effective as of July 1, 2008 and the reduction based on the average CMAC rate minus 5 percent that was effective on October 1, 2008; and,
• Exempts hospital in-patient reimbursement rates from the 10 percent provider reimbursement rate reduction enacted in AB 97 (Committee on Budget), Chapter 3, Statutes of 2011, the health budget trailer bill that enacted the statutory changes necessary for the Budget Act of 2011-12.

Additionally, SB 90 reduces, disproportionate share hospital (DSH) replacement payments to private hospitals by $30 million General Fund, and matching Federal Financial Participation (FFP) for the current budget year and by $75 million General Fund for 2011-12. 

AB 113 establishes an Inter-governmental Transfer Program for non-designated public hospitals (hospitals owned by health care districts). Under the program, public entities would voluntarily elect to transfer funds to the state for the purpose of drawing down federal Medicaid funds to make supplemental payments to these hospitals. AB 113 establishes an allocation formula for the supplemental payments. The enactment of this bill is contingent upon the enactment of SB 90. AB 113 would appropriate $1.5 billion from the Hospital Quality Assurance Revenue Fund and $1.5 billion from the Federal Trust Fund to make supplemental payments to private hospitals under SB 90 (Steinberg). 

Both bills would take effect immediately as urgency statutes.

Adult Protective Services

SB 33 (Simitian) – Support
As Introduced on December 6, 2010

SB 33, by Senator Joe Simitian, would repeal the sunset date for statute that designates certain financial institution employees as mandated reporters for suspected financial abuse of elder or dependent adults. 

Senator Simitian authored SB 1018 in 2007 to expand the definition of mandated reporters of elder or dependent adult abuse to those who work at financial institutions. SB builds that statute by removing the January 1, 2013 sunset date, and makes other small technical changes to the statute. 

The Senate Banking and Financial Institutions Committee passed Senator Simitian’s SB 33 on April 6 on consent, and the measure now goes to the Senate Judiciary Committee. 

Foster Youth

AB 194 (Beall) – Support
As Amended on March 24, 2011

AB 194, a bill by Assembly Member Jim Beall, would grant foster youth priority enrollment in a public university or community college system. 

AB 194 specifically would allow foster youth and former foster youth to receive priority enrollment in the California State University and community college system, if the specific campus utilizes the required technology to grant priority enrollment. AB 194 also requests the participation of the University of California system. 

Counties support efforts to ensure the long-term success of foster youth and former foster youth and therefore support AB 194. The Assembly Appropriations Committee passed the bill on April 6, and it now goes to the Assembly Floor. 

AB 212 (Beall) – Support
As Amended on March 29, 2011

AB 212, by Assembly Member Jim Beall, would implement technical provisions related to last year’s landmark foster care legislation, the California Fostering Connections to Success Act of 2010 (AB 12). 

AB 212 is the result of efforts by counties, co-sponsors, and Department of Social Services staff to “clean up” some provisions of AB 12. To that end, AB 212 mostly focuses on implementing KinGAP eligibility for young adults aged 18 to 21, and streamlining the assessment portion of the legal guardianship and adoptions process. 

AB 212 was passed by the Assembly Human Services Committee on April 5, and now goes to the Assembly Judiciary Committee. 

Health and Public Health

AB 300 (Ma) – Support
As Amended on March 10, 2011

AB 300, by Assembly Member Fiona Ma, would establish clear standards for the tattoo, piercing and permanent cosmetics industry in California.

AB 300 establishes a clear scope of local authority, clear requirements for registration of body art practitioners and consistent enforcement of mobile and fixed body art sites. The bill also requires body art practitioners, as a provision of registration, to complete courses on the transmission of blood borne pathogens and first aid.

The Assembly Appropriations Committee passed the bill on April 6, and it now goes to the Assembly Floor. 

SB 594 (Wolk) – Oppose Unless Amended
As Introduced on February 17, 2011

SB 594, by Senator Lois Wolk, would greatly limit a county’s flexibility to organize and deliver public health laboratory services.

Counties are concerned that SB 594 would (1) require that a county’s designated public health laboratory be operated by a city or county and (2) expand the types of laboratory services that must be performed by a county’s designated public health laboratory to include lab services for all local health department programs.

Senate Bill 594 would eliminate the option for county health departments to contract with qualified private clinical laboratories to perform various laboratory services as needed. Furthermore, SB 594 would prevent counties from forming consortia to jointly operate regional public health laboratories. In these grim fiscal times, counties must retain the flexibility to fulfill their responsibilities in the most efficient, cost-effective, and accurate manner. 

Counties have asked the author to amend the bill in the following manner: 

1. Remove sections that would require a county’s designated public health laboratory to be one operated by a city or county.

2. Remove the expansion of the types of services that must be provided by a county’s designated public health laboratory.

3. Remove the requirement that a local public health laboratory director report to the local health officer.

4. Make the consultation services by the local public health laboratory permissive rather than mandatory.

Counties believe that in this economic climate, we must retain the flexibility to provide critical public services in the most cost-effective, appropriate and reasonable manner. It is for these reasons that CSAC, the Urban Counties Caucus, and the Regional Council of Rural Counties have asked Senator Wolk to amend the bill. SB 594 has not yet been set for a hearing, but has been referred to the Senate Health Committee. 

Medi-Cal

SB 695 (Hancock) – Support
As Amended on April 6, 2011

SB 695, by Senator Loni Hancock, would allow counties to draw down federal funding to help defray the cost of providing medical care to juveniles awaiting adjudication in county facilities. 

SB 695 would allow counties to use the local funds that spent on juvenile medical care to pull down federal Medicaid matching funds for those youths who are Medi-Cal eligible. The measure also limits Medi-Cal services to the first 30 days of a youth’s stay in juvenile hall. 

The Senate Health Committee passed SB 695 on April 6, and it now moves to the Senate Appropriations Committee. 

AB 540 (Beall) – Support
As Introduced on February 16, 2011

AB 540, by Assembly Member Jim Beall, would allow California to draw down federal funding for providing confidential alcohol and drug screening and brief intervention services to pregnant women and women of childbearing age who also qualify for Medi-Cal benefits. 

By implementing the Medi-Cal Alcohol and Drug Screening and Brief Intervention Services Program, AB 540 would create a voluntary-participation program for the counties to provide the non-federal match. The bill would then enable the state to draw down federal revenue for counties that are already providing these services. For every local dollar invested, California could receive a dollar match from the federal government. Furthermore, the bill clarifies that SBI services would be targeted to pregnant women and women of childbearing age, and all participation would be both voluntary and confidential. 

AB 540 would provide counties with a much-needed federal revenue stream – at no cost to the state – for these valuable services, and this is why CSAC supports the bill. The Assembly Health Committee passed the bill on April 5, and it now goes to the Assembly Appropriations Committee. 

CalWORKs

AB 1182 (Hernández) – Support
As Introduced on February 18, 2011

AB 1182, by Assembly Member Roger Hernández, would allow CalWORKs applicants and recipients to own reliable cars. 

AB 1182 would specifically delete the requirement that counties assess the value of a motor vehicle when determining or redetermining CalWORKs eligibility. 

AB 1182 would increase the opportunities for recipients to find and maintain stable employment, while also increasing the state’s work participation rate, reducing grant costs in the long run and helping to avoid federal penalties. It is for these reasons that CSAC supports AB 1182, which has been referred to the Assembly Human Services Committee, but not yet set for hearing. 

Mental Health

AB 154 (Beall) – Support
As Amended on March 24, 2011

AB 154, by Assembly Member Jim Beall, would require Knox-Keene licensed health plans to expand mental health coverage to include the diagnosis and treatment of any mental health condition or disorder as defined in the Diagnostic and Statistical Manual IV (DSM-IV) (or subsequent editions), including substance abuse and nicotine treatment. 

AB 154 was also recently amended to allow the newly established California Health Benefit Exchange to offer mental health services that conform with the minimum essential benefits package as outlined in the federal Patient Protection and Affordable Care Act (PL 111-148). 

AB 154 builds upon the original California mental health parity legislation, AB 88 (Thomson, Chapter 534, Statutes of 1999), which requires health plans to provide coverage for the diagnosis and medically necessary treatment of severe mental illnesses of a person of any age, and serious emotional disturbances of children, under the same terms and conditions applied to other medical conditions.

AB 154 would help ensure that private health plans treat individuals with mental health, substance abuse or co-occurring disorders in a comprehensive and meaningful way. It is for these reasons that CSAC and the California Mental Health Directors Association (CMHDA) jointly support AB 154. The bill was passed by the Assembly Health Committee on April 5 and now goes to the Assembly Appropriations Committee. 

First 5 Commissions

SB 486 (Dutton) – Oppose
As Introduced on February 17, 2011

Senate Bill 486, by Senator Bob Dutton, would redirect First 5 funding away from statewide and local children’s programs and into the state General Fund for children’s health programs. 

SB 486 would divert the voter-approved Proposition 10 revenue from First 5 Commissions into the state’s General Fund, where the Legislature could appropriate it to provide health care services and funding for children’s health care initiatives, such as the Healthy Families Program or Medi-Cal. 

Counties note that county First 5 Commissions currently fund a variety of health care services throughout the state, including large portions of the Healthy Families Program, and Children’s Health Initiatives (CHI) in some counties, in which Proposition 10 revenue represents the single largest funder of insurance premiums for children. In counties that do not have the resources to operate a CHI, county commissions have worked to offer outreach and insurance applications assistance into virtually all of their local work to ensure children are enrolled in the insurance programs for which they are eligible. 

By taking funding from the county First 5 Commissions, SB 486 will end the kind of local support of health insurance enrollment and CHI’s described above, as well as eliminate the comprehensive range of local services currently supported by First 5. 

The local First 5 commissions are also currently grappling with a $950 million fund shift as authorized by AB 99 (Committee on Budget). This huge fund shift will cripple the local commissions and reduce their ability to provide the local services outlined above in the coming fiscal year. 

SB 486 would also require a statewide election to modify the intent of Proposition 10. The voters of this state have twice previously rejected any modifications to Proposition 10.

It is for these reasons that CSAC opposes SB 486. The bill is set for hearing in the Senate Health Committee on April 13.