AB1518 (Committee on Aging and Long-Term Care)Page 1 of 2
SENATE COMMITTEE ONHEALTH
SenatorEd Hernandez, O.D., Chair
BILL NO: AB1518
AUTHOR: / Committee on Aging and Long-Term CareVERSION: / June 25, 2015
HEARING DATE: / July 1, 2015
CONSULTANT: / Scott Bain
SUBJECT: Medi-Cal: nursing facilities
SUMMARY:
Requires the Department of Health Care Services (DHCS) toapply for an additional 5,000slots beyond those currently authorized for the home- and community-basedNursing Facility/Acute Hospital Waiver in 2016-17.Requires DHCS to annually calculate the need for additional slots annually thereafter, and seek federal approval to add those slots to this waiver, taking into consideration specified factors. Requires DHCS to adjust the cost limitation category of this waiver to use an aggregate cost limit formula, and requires the aggregate cost limit formula to be based on the actual current rates for the corresponding institutional levels of care specified in this waiver.
Existing law:
1)Establishes the Medi-Cal program, administered by DHCS, under which qualified low-income individuals receive health care services.
2)Establishes a schedule of benefits in the Medi-Cal program, which include:
a)Early and periodic screening, diagnosis, and treatment (EPSDT) for any individual under 21 years of age, consistent with the requirements of federal Medicaid law; and,
b)Home- and community-based services (HCBS) approved by the federal Department of Health and Human Services are covered to the extent that federal financial participation (FFP) is available for those services under the state plan or waivers. Permits the director of DHCS to seek waivers for any or all HCBS approvable under specified provisions of federal law. Requires coverage for HCBS to be limited by the terms, conditions, and duration of the federal waivers.
3)Authorizes, under federal Medicaid law, the federal Secretary of Health and Human Services to allow a state to include as “medical assistance” under its Medicaid program payment for part or all of the cost of HCBS (other than room and board) approved by the Secretary which are provided pursuant to a written plan of care to individuals who would require the level of care provided in a hospital or a nursing facility or intermediate care facility which could be reimbursed under the state’s Medicaid program. This provision of federal law is referred to as a Medicaid 1915(c) Home and Community-Based Services Waiver, and it enables the state to received federal Medicaid matching funds for HCBS.
4)Requires an additional 500 slots beyond those currently authorized for the home- and community-based Level A/B nursing facility waiver to be added, and 250 of these slots to be reserved for residents residing in facilities and transitioning out of facilities. Defines “facility residents” as individuals who are currently residing in a nursing facility and whose care is paid for by Medi-Cal either with or without a share of cost and individuals who are hospitalized and who are or will be waiting for transfer to a nursing facility.
5)Requires DHCS to expedite the processing of waiver applications for those patients who are in acute care hospitals and who are pending placement in a nursing facility in order to divert hospital discharges from nursing facilities into the community.
6)Requires DHCS to implement the provisions of 3 and 4) above only to the extent it can demonstrate fiscal neutrality within the overall DHCS budget, and federal fiscal neutrality as required under the terms of the federal waiver, and only if DHCS has obtained the necessary approvals and receives federal financial participation from the federal Centers for Medicare and Medicaid Services (CMS).
This bill:
1)Requires DHCS, for the 2016-17 fiscal year, toapply for an additional 5,000slots beyond those currently authorized for the home- and community-basedNursing Facility/Acute Hospital Waiver (NF/AH Waiver), to ensure that eligible individuals residing in, or at risk of, out-of-home placements, including nursing facilities, can be considered for and receive services from the waiver without delay.
2)Requires DHCS, for each fiscal year after 2016-17, to annually calculate the need for additional slots, and seek federal approval to add those slots to the NF/AH Waiver, taking into consideration, at minimum, the following:
a)Any waiting list for NF/AH Waiver services, including, but not limited to, waiting lists for a particular level of care; and,
b)The results of surveys of nursing home residents, including, but not limited to, the Minimum Data Sets (MDS), which identify residents who want to leave nursing homes.
3)Requires DHCS, in making the determination in 2) above, to consult with stakeholders, including, but not limited to, individuals who use or would like to use waiver services, programs with state contracts to divert people from or help people leave nursing homes, the designated protection and advocacy organization, independent living centers, area agencies on aging, county staff providing for the delivery of In-Home Supportive Services (IHSS), individuals providing IHSS services, and Medi-Cal managed care plans providing Medi-Cal long-term services and supports.
4)Requires DHCS, prior to submitting the annual request for additional waiver slots and the waiver renewal request, to notify the appropriate fiscal and policy committees of the Legislature of the number of waiver slots included in the waiver renewal request, along with data supporting that number of slots.
5)Requires DHCS to expedite the processing of waiver applications for those individuals who are at imminent risk of placement in a hospital or nursing facility.
6)Defines “imminent risk” as more likely than not to occur within 60 days, as determined by a treating professional, including, but not limited to, a physician, a licensed clinical social worker, or a nurse.
7)Defines “expedite the processing of waiver applications” to mean that DHCS must make an eligibility and level of care determination, and inform the individual about available waiver services, within three business days of receipt of the application.
8)Requires that an individual residing in an institutional setting at a level of care included in the NF/AH Waiver to be determined to qualify for a waiver level of care that is no lower than the level of care he or she receives in the institution in which he or she resides. Prohibits DHCS from using more stringent eligibility criteria for a waiver level of care than for the corresponding institutional level of care.
9)Requires that an individual who enrolls in the NF/AH Waiverupon attaining 21 years of age who is no longer eligible to receive services under the EPSDT program to be eligible for at least the same level of services under the NF/AH Waiverthat he or she received through the EPSDT program unless the individual, and his or her authorized representative, as applicable, agree that the individual’s needs have decreased and a lower level of service is needed.
10)Requires DHCS to maximize federal financial participation (FFP) to meet the identified level of need for in-home nursing to ensure that a consumer does not experience a reduction in in-home nursing when he or she reaches 21 years of age.
11)Requires DHCS, by July 1, 2016, to adjust the cost limitation category of the NF/AH Waiverto use an aggregate cost limit formula. (The waiver currently uses an individual cost cap.)
12)Requires, by July 1, 2016, the aggregate cost limit formula to be based on the actual current rates for the corresponding institutional levels of care specified in the NF/AH Waiver. Requires any cost increase in an institutional level of care to be matched by an increase in the cost limitation of the corresponding NF/AH waiverlevel of care.
13)Requires DHCS to implement the waiver only if it can demonstrate DHCS’ actual total expenditures for HCBS and other services under the NF/AH Waiver will not, in any year of waiver period, exceed the amount that would be incurred by the Medi-Cal program for those individuals in institutions for which the individual qualifies without the waiver. (Current law requires DHCS to demonstrate fiscal neutrality within the overall DHCS budget.)
14)Requires implementation of this bill to commence within six months of DHCS receiving authorization for the necessary resources to provide the services to additional waiver participants.
FISCAL EFFECT:
According to the Assembly Appropriations Committee:
1)One-time administrative costs in the range of $100,000 (General Fund (GF)/federal) for DHCS to apply for a waiver amendment and seek federal approval, and to establish new policies and procedures related to the bill's requirements, such as assessment of imminent risk and determinations of level of care.
2)Though a comprehensive budget neutrality analysis and assessment of unmet need for waiver services is not available, it is assumed total costs for Medi-Cal benefits will be cost-neutral, as the bill specifies. Within the overall budget neutrality, it is expected the state will incur unknown annual costs, likely in the hundreds of thousands of dollars (GF/federal), for additional state staff to conduct assessments for waiver eligibility on an expedited basis, as well as significant cost savings to the extent individuals are cared for at home instead of in a facility.
PRIOR VOTES:
Assembly Floor: / 80 - 0Assembly Appropriations Committee: / 17 - 0
Assembly Health Committee: / 19 - 0
COMMENTS:
1)Author’s statement. According to the author, as the wife and caregiver of a proud American and proud Californian, bound to a wheelchair for the remainder of his life, the author wishes to remind members that 2015 marks the 25th anniversary of the Americans with Disabilities Act (ADA), which says that people with disabilities have a right to receive services in the most integrated setting. The 1999 Supreme Court Olmstead decision upheld that right. In this bill, the Assembly Committee on Aging and Long-Term Care is asking the legislature to modernize the NF/AH waiver to reflect the ADA and the 1999 Olmstead decision, and the wishes of vast numbers of Californians who want to stay at home to receive services. Additionally, the state budget savings that will be realized because home-based services are generally less expensive than comparable institutional services should offer tremendous confidence that this is the correct direction to move as the state faces the unknown implications of 1,000 people a day turning 65 and aging into a period of their lives when disability is more common than not.Currently, access to the NF/AH waiver is restricted to a fixed number of participants, thus creating an irrational barrier to a community-based option for care, while encouraging unfettered access to less desirable, more expensive institutional care. This bill revises our state policies to assure access to waiver services for more people. This measure would also moderate the way young disabled people are treated when they reach age 21, by preserving their eligibility for the community based care they receive in the EPTSD program.
2)Nursing Facility/Acute Hospital Waiver.The NF/AH Waiver is a federal 1915(c) Home and Community-Based Services Waiver in effect through December 31, 2016. Section 1915(c) waivers allow states to receive Medicaid funding to provide long-term care services in home and community settings, rather than in institutional settings. The goals of the waiver are to:
a)Facilitate a safe and timely transition of Medi-Cal eligible persons from a medical facility to his/her home or community setting utilizing NF/AH Waiver services;
b)Offer Medi-Cal eligible persons who reside in the community but are at risk of being institutionalized within the next 30 days, the option of utilizing NF/AH Waiver services to develop a home or community setting program that will safely meet his/her medical care needs; and,
c)Maintain overall cost neutrality so that the costs of the participant’s selected NF/AH Waiver and Medi-Cal state plan services do not exceed the Medi-Cal institutional cost at the participant’s assessed level of care (LOC) and necessary facility type.
DHCS’ Long-Term Care Division In-Home Operations Branch is responsible for the implementationand monitoring of the NF/AH waiver. Waiver participants must have a current Plan of Treatment (POT) signed by theparticipant and/or legalrepresentative/legally responsible adult, the participant’s primary care physician or designatedphysician assistant or nurse practitionerand all HCBS waiver providers. The POT describes all the participant’s care services, and frequency and providers of theidentified services to ensure his/her health and safety in a home or community setting.
To be eligible for the waiver, an individual must:
a)Have full scope Medi-Cal eligibility;
b)Be physically disabled (of any age);
c)Meet the acute hospital, adult or pediatric subacute, nursing facility, distinct-part nursing facility, adult, or pediatric Level B (skilled) nursing facility, or Level A (intermediate) nursing facility (NF)Level of Carewith the option of returning to and/or remaining in his/her home or home-like setting in the community in lieu of institutionalization; and,
d)Meet other criteria and requirements listed in the waiver
Waiver services are delivered through Medi-Cal HCBS Waiver providers such as home health agencies, durable medical equipment companies, individual nurse providers, licensed clinical social workers, marriage and family therapists, personal care agencies, non-profit organizations, professional corporations, individual personal care providers, and certain community residential facilities.Services provided under the waiver include the following:
a)Private Duty Nursing, including Shared Nursing;
b)Home Health Aide Services;
c)Case Management;
d)Transitional Case Management;
e)Environmental Accessibility Adaptations;
f)Personal Emergency Response Systems (PERS);
g)PERS Installation and Training;
h)Medical Equipment Operating Expenses;
i)Waiver Personal Care Services;
j)Community Transition;
k)Habilitation Services;
l)Respite Care (home and facility);
m)Developmentally Disabled/Continuous NursingCare Non-Ventilator Dependent Services; and,
n)Developmentally Disabled/Continuous Nursing Care Ventilator Dependent Services
Enrollment in the waiver is capped (referred to as “slots” by calendar year). For 2015, the enrollment cap is 3,792, increasing to 3,964 in 2016.DHCS indicates current enrollment waiver enrollment is 3,328 individuals. DHCS indicates there is not currently a wait list for the NF/AH waiver services, and there is priority enrollment for persons residing in hospitals, skilled nursing facilities, and children aging out of EPSDT. DHCS policy if there is a waitlist is that available waiver slots are assigned to NF/AH eligible individuals in the following order: (a) individuals who have been residing in a health care facility for at least 90 days at the time of submission of the waiver application; and (b) individuals residing in the community at the time of submission of the waiver application.
3)Waiver cost caps.As part of the NF/AH waiver, the state is required to provide assurances to the federal government, including assurances on cost neutrality of the waiver. Under the waiver, DHCS assures that:
a)For any year that the waiver is in effect, the average per capita expenditures under the waiver will not exceed the average per capita expenditures that would have been made under the Medicaid State plan (under Medi-Cal) for the level of care specified for the waiver, had the waiver not been granted; and,
b)The actual total expenditures for home and community-based waiver and other Medicaid services and its claim for FFP in expenditures for the services provided to individuals under the waiver would not, in any year of the waiver period, exceed the amount that would be incurred in the absence of the waiver by the State's Medicaid program for these individuals in the institutional setting specified for this waiver.
Under the NF/AH Waiver, DHCS refuses entry any otherwise qualified individual when it reasonably expects that the cost of home and community-based services furnished to that individual would exceed the following amount specified by the state that is less than the cost of a level of care specified for the waiver, as follows:
Institutional Level of Care Annual Institutional Rate Annual NF/AH
2014Waiver Cost-Cap
Nursing Facility (NF)-A$33,781 $29,548
Nursing Facility (NF)-B$68,178 $48,180
NF-B Pediatric$102,200$101,882
NF-Distinct Part$149,149$77,600
Continuous Nursing (non-vent)NA (Adult)
NA (Pediatric) $140,678
Continuous Nursing (vent)NA$155,461
NF-Subacute, Adult$232,255$180,219
NF-Subacute, Pediatric$289,591$240,211
Acute Hospital$388,367$305,283
The dollar limitation amounts in the NF/AH Waiver is referred to as an individual costcap. Under an individual cost cap, services covered by Medi-Cal (such as IHSS) are deducted from each individual’s waiver budget, which reduces the amount of waiver services that can be purchased. When a waiver provider’s rates are increased, an individual receives additional hours of IHSS services, or the individual’s IHSS workers receive payment for overtime, these amounts are deducted from the individual’s waiver budget, which erodes the beneficiary’s purchasing power using waiver dollars.
To address thesetwo issues, this bill requires an aggregate costcap instead of an individual cost cap. This change makes the NF/AH waiver function more like an insurance model in that it would enable individuals who are currently at their dollar cap for waiver services to receive additional services from the “savings” resulting from individuals who are enrolled in the waiver but whose spending on waiver services is below their individual dollar cost cap.
In addition, this bill requires the aggregate cost limit formula shown in the chart above to be based on the actual current rates for the institutional level of care. Further, this bill would require those waiver amounts to be adjusted to account for changes in institutional care rates as a result of rate increases. The waiver cost caps are currently fixed amounts in the NF/AHwaiver, and the dollar amounts are lower than the institutional level of care. This provision of the bill would require thewaiver cap amountsbe at parity with the institutional dollar amounts, and would require the waiver cost cap amounts to maintain parity by requiring the waiver cost caps to increase with any corresponding changes in the institutional rates.
4)EPSDT.The Medicaid program’s benefit for children and adolescents is known as EPSDT. EPSDT provides a comprehensive array of prevention, diagnostic, and treatment services for low-income infants, children and adolescents under age 21. The EPSDT benefit is more robust than the Medicaid benefit for adults and is designed to assure that children receive early detection and care, so that health problems are averted or diagnosed and treated as early as possible. EPSDT entitles enrolled infants, children and adolescents to any treatment or procedure that fits within any of the categories of Medicaid-covered services if that treatment or service is necessary to “correct or ameliorate” defects and physical and mental illnesses or conditions.
This bill makes an individual who was receiving services under EPSDT eligible for at least the same level of services under the NF/AH Waiver that he or she received through EPSDT unless the individual agrees that the individual’s needs have decreased and a lower level of service is needed. There are several reasons for this change. The first is to prevent a reduction in home nursing as the Medi-Cal rates for adult facilities are considerably lower than those for pediatric facilities. For example, the NF-B adult rate is $68,178, as compared to the NF-B pediatric rate of $102,200. Second, the NF/AH waiver cost caps are lower for adults as compared to children. For example, the NF-Subacute cost cap under the waiver is $180,219 for adults versus $240,211 for children). Finally, children who meet the pediatric subacute level of care may not meet the more rigid adult subacute level of care, which can result in unnecessary placement in developmental centers or other institutions.