CDCAN REPORT #153-2011: Effective date for elimination of Adult Day Health Care as Medi-Cal optional benefit delayed

OBAMA ADMINISTRATION APPROVES 90 DAY DELAY IN ELIMINATING ADULT DAY HEALTH CARE AS MEDI-CAL BENEFIT

New Effective Date For Elimination Is December 1, 2011 - No Action Yet By Governor On AB 96 Adult Day Health Care Budget Trailer Bill

SACRAMENTO, CALIF (CDCAN)  [Last updated 07/22/2011 10:30 PM] - In a welcome reprieve for tens of thousands of people with disabilities and seniors in California, the US Department of Health and Human Services under the Obama Administration, approved the State's request to delay for 90 days - until December 1, 2011 - the effective date of the elimination of Adult Day Health Care as a Medi-Cal benefit.  The original effective date, approved July 1st, was September 1, 2011 - but the Brown Administration announced on July 14th in a letter to the Legislature the date would be delayed at least 30 days or longer.

The news will impact over 34,000 people with disabilities and seniors in the Adult Day Health Care program, and the over 300 community organizations and over 7,000 people who, as employees who provide those services - all who faced imminent elimination of the Medi-Cal service, and likely closure of hundreds of community-based providers and the loss of thousands of jobs across the State in a mattter of weeks - a situation that at least for now -  as been averted until December.

The approval of the 90 day delay came in a letter, dated July 21,  from Gloria Nagle, Associate Regional Administrator, Division of Medicaid and Children's Health Operations, Centers on Medicare and Medicaid Services, the US Department of Health and Human Services to Toby Douglas, Director of the California Department of Health Care Services - the state agency that oversees the State's Medi-Cal program.  [CDCAN Note: A copy of the 2 page letter with 6 pages of attachments, is attached to this CDCAN Report as a pdf file titled "2011-07-21 - ADHC Extension Approval Letter.pdf"  The letter and attachments however were saved as an image - and not as documents, so persons who are blind or persons with sight impairments using screen reading devices will not be able to read it.  I have typed the entire text of the main two page letter below however - Marty Omoto]

The elimination of the entire Adult Day Health Care program as a Medi-Cal "optional benefit"  was proposed by Governor Brown last January and approved by the Legislature in March as part of the larger package of spending cuts to close the enormous budget deficit.  The elimination of Adult Day Health Care as a Medi-Cal "optional benefit" was the largest single sweeping reduction in health and human services in at least the last 15 years with the combined direct impact of tens of thousands of recipients, workers and hundreds of community-based providers - nearly all who face imminent closure, and for individual workersthe  loss of jobs and income for their own families in a matter of months.

It is called a Medi-Cal "optional benefit" because it is a benefit or service that the federal government does not require the states to provide as part of their approved Medicaid program (called "Medi-Cal" in California).

Other Developments Regarding Adult Day Health Care

• Meanwhile, as of Friday evening 10:30 PM, Governor Brown has not yet taken action on the budget trailer bills passed by the Legislature before they adjourned for their summer recess on July 14th - including two dealing with Adult Day Health Care (see below for latest status on those bills).
• The more controversial bill, AB 96, titled "Keeping Adults Free from Institutionalization" would require the Department of Health Care Services to develop and submit a proposal to the federal government for a new model of Adult Day Health Care under a new federal Medicaid waiver or through other Medicaid funding.
• Even with the delay, major questions remain however regarding the transition not only of the over 34,000 people with disabilities and seniors in the program, but of the hundreds of community-based providers and the thousands of people they employee - with some answers to some of the questions that advocates say AB 96 can help to answer.
• The Brown Administration has largely been silent on issues surrounding transition impacting community based providers and their workers, other than the issues directly connected to recipients in the program and their referral to other similar services.
• The Governor has until Monday evening, 11:59 PM (July 25th) to sign or veto the bill (or allow the bill to become law without his signature).
• A federal district court hearing scheduled for next week on a lawsuit seeking to block the elimination of Adult Day Health Care on behalf of the over 34,000 people with disabilities and seniors in the program filed by several disability and senior advocacy public interest organizations, will be delayed until November 1, 2011 because of the delay in the effective date of the elimination of Adult Day Health Care.

WHAT THIS NEWS MEANS

• Adult  Day Health Care will remain a Medi-Cal benefit at least until December 1, 2011 (instead of September 1, 2011).
• As of today (July 22), the Brown Administration - as represented by the Department of Health Care Services - has not officially moved forward in planning, developing or submitting a proposal for a new model of Adult Day Health Care under a new federal Medicaid waiver or other proposal under the Medicaid program - meaning the State is still proceeding officially with a plan to only move people currently in the Adult Day Health Care program into other similar Medi-Cal services - with no official plans regarding the transition of existing Adult Day Health Care centers and their employees, and no plans regarding development and submission of a proposal for a new model of the program under a federal Medicaid waiver or other Medicaid program. Two of the budget trailer bills sent to the Governor this month seek to address some of those issues.
• As of today (July 22), questions remain on if and how a transition to a new model of Adult Day Health Care would be implemented - and whether or not such a model would be established before the current Adult Day Health Care Medi-Cal benefit is eliminated.
• The Legislature in March and again in June, restored $85 million in State general funds for the 2011-2012 State budget year to help in transition of the eliminated Medi-Cal benefit into a new model of Adult Day Health Care.
• However that amount is only half the State general funding that the Adult Day Health Care program received in the 2010-2011 State budget year that ended June 30th. It is not clear how many of the over 300 centers, 7,000 employees and over 34,000 recipients will be able to continue in a new model of Adult Day Health Care with State general funding cut by 50%.

WHO THIS IMPACTS

• Over 34,000 seniors and people with disabilities - including thousands of persons with developmental disabilities, who are in the Adult Day Health Care program either through Medi-Cal or referred there through one of the 21 non-profit regional centers under the State's Lanterman Developmental Disabilities Services Act  (the nation's only civil rights act for persons with developmental disabilities).  It is not clear how the elimination of the Medi-Cal optional benefit impacts those persons since they were placed in those programs through regional centers - not through the Medi-Cal program.
• Over 7,000 people who work in the over 300 community-based organizations that provide Adult Day Health Care services - probably nearly all facing either outright closure and elimination of thousands of jobs in a matter of months, the time frame is not clear.   Advocates say that many of those people and organizations could be helped by the enactment of AB 96.
• Other agencies and community organizations, including the 21 non-profit regional centers, county health and human services agencies, including those involved with Medi-Cal, In-Home Supportive Services, housing and other supports and services.

TEXT OF LETTER FROM OBAMA ADMINISTRATION ON ADULT DAY HEALTH CARE

DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare and Medicaid Services Region IX
Division of Medicaid & Children's Health Operations
90 Seventh Street, Suite 5-300 (5W)
San Francisco, CA  94103-6706

July 21, 2011

Toby Douglas, Director
California Department of Health Care Services
P.O. Box 997413, MS 0000
Sacramento, CA 95899-7413

Dear Mr. Douglas:

Enclosed is an approved copy of California State Plan Amendment (SPA) 11-026.  This SPA was submitted to my office on July 20, 2011 requesting to amend the State Plan to delay the effective date of the elimination of the coverage of Adult Day Health Care (ADHC) services to December 1, 2011.  The elimination was previously approved effective September 1, 2011 via SPA 11-014.

The effective date of this SPA is December 1, 2011.  Enclosed are the following approved SPA pages that should be incorporated into your approved State Plan:

• Limitations on Attachment 3.1-A, page 19
• Limitations on Attachment 3.1-B, page 19
• Attachment 4.19B, page 6C
• Attachment 4.19-B, page 6D
• Supplement 6 to Attachment 4.19-B, page 2

The approval of this State Plan Amendment relates solely to the availability of Federal Financial Participation (FFP) for Medicaid covered services.  This action does not in any way address the State's independent obligations under the Americans with Disabilities Act or the Supreme Court's Olmstead decision.

If you have any questions, please contact Kristin Curran Dillon by phone at (415) 744-3579 or by email at Kristin.Dillon@cms.hhs.gov , or Rodd Mas at 415-744-2978 or by email at Rodd.Ms@cms.hhs.gov .
 
Sincerely
[original signed]

Gloria Nagle, Ph.D., MPA
Associate Regional Administrator
Division of Medicaid & Children's Health Operations

Enclosure

CC:

• Jean Close, Centers for Medicare and Medicaid Services
• Elizabeth Garbarczyk, Centers for Medicare and Medicaid Services
• Vickie Orlich, California Department of Health Care Services
• Christopher Thompson, Centers for Medicare and Medicaid Services 
• Kathryn Waje, California Department of Health Care Services

CDCAN SUMMARY OF ADULT DAY HEALTH CARE RELATED BUDGET TRAILER BILLS

This is the latest information and status (as of 10:30 PM July 22, 2011 Friday evening) on the four budget related bills that impact Adult Day Health Care (or the people in the program as in the case of SB 93):

SB 91 - BUDGET TRAILER BILL: ADULT DAY HEALTH CARE: CENTERS: MEDI-CAL CERTIFICATION

AUTHOR: Senate Budget and Fiscal Review Committee
CDCAN SUMMARY:  Contains necessary technical corrections as a result of the elimination of Adult Day Health Care as a Medi-Cal "optional benefit" the budget trailer bill, AB 97 (Chapter 3, Statutes of 2011 as follows:

• Delinks licensure from Medi-Cal certification for Adult Day Health Care centers,  Current State law requires Adult Day Health Care Centers to be certified Medi-Cal providers as a condition of State licensure. This bill delinks certification and licensure.
• Permits Adult Day Health Care centers  to operate "adult day programs," for individuals  who do not require on-site medical care, without obtaining an  additional social services license and specifies that:
  • The Adult Day Health Care center is to provide notice to the State
  • An on-site inspection will not be required; and
  • The local fire authority shall determine capacity limits. 
• Adds an appropriation allowing this bill to take effect immediately upon enactment.

PREVIOUS ACTION 07/14/2011: PASSED Assembly by vote of 51 to 8. In State Senate. Heard in Senate Budget and Fiscal Review Committee and referred to Senate floor.  PASSED State Senate by vote of  24 to 14.
LATEST ACTION 07/19/2011: Sent to the Governor at 1:00 PM.
NEXT STEPS: Governor has 12 calendar days to sign or veto the bill (or allow it to become law without his signature.
EFFECTIVE DATE:  Effective upon approval of the Governor (or as provided for in the bill)
CDCAN COMMENT:  This 8 page bill does not address or resolve the current problems of transitioning the existing Adult Day Health Care program into a new model under a yet to be developed (and submitted) federal Medicaid waiver. That issue is addressed however in another new budget trailer bill passed today, SB 97 that delays the effective date of the elimination of Adult Day Health Care as a Medi-Cal "optional benefit" for another 60 days - which was held because of the letter from the Brown Administration announcing a delay in the effective date.
Other details of the transition are contained in AB 96, a budget trailer bill approved by the Legislature on June 15th that was sent to the Governor on July 14th.
LATEST VERSION OF BILL - HTML: http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_91_bill_20110715_enrolled.html
LATEST VERSION OF BILL - PDF:  http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_91_bill_20110715_enrolled.pdf
PRIORITY: VERY HIGH

SB 93 - BUDGET TRAILER BILL: HEALTH & HUMAN SERVICES: IHSS TRIGGER CUT  ("CLEAN-UP" BILL TO SB 73)

AUTHOR: Senate Budget and Fiscal Review Committee
CDCAN SUMMARY:  Makes technical change or correction to SB 73 provisions dealing with In-Home Supportive Services (IHSS) "trigger cuts".  The bill would make a technical correction to correctly  identify the component, subdivision (b), of Control Section 3.94 of the Budget Act of 2011 that would cause the reduction in In-Home Supportive Services to be implemented under the triggers included in the budget package, and adds an appropriation allowing this bill to take effect immediately upon enactment.
PREVIOUS ACTION 07/14/2011:  In State Senate. Heard in Senate Budget and Fiscal Review Committee and referred to Senate floor.  PASSED State Senate by vote of 24 to 14. (PASSED Assembly by vote of 48 to 27 on 07/11/2011).
LATEST ACTION 07/19/2011: Sent to the Governor at 1:00 PM.
NEXT STEPS: Governor has 12 calendar days to sign or veto the bill (or allow it to become law without his signature.
CDCAN COMMENT:  This bill makes only a technical change to the provisions related to the previously approved "trigger cuts" to IHSS.  Clarifies that the IHSS "trigger cuts" are "tier 1" trigger cuts. While this bill does not focus on Adult Day Health Care, In-Home Supportive Services does impact many of the over 34,000 people in the Adult Day Health Care program who also are in the IHSS program.     
LINK TO LATEST VERSION OF BILL - HTML   http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_93_bill_20110715_enrolled.html
LINK TO LATEST VERSION OF BILL - PDF:  http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_93_bill_20110715_enrolled.pdf
PRIORITY:  HIGH

SB 97 - BUDGET TRAILER BILL: ADULT DAY HEALTH CARE: CENTERS

AUTHOR: Senate Budget and Fiscal Review Committee
CDCAN SUMMARY:  Delays the effective date from September 1, 2011 to November 1, 2011 the elimination of Adult Day Health Care Medi-Cal "optional benefit" to allow more time for transition.  Funding would come out of the already appropriated $85 million in State General Funds.
PREVIOUS ACTION 07/14/2011: Amended in the Assembly.   
LATEST ACTION 07/14/2011: PASSED Assembly by vote of 50 to 10.  In State Senate.
NEXT STEPS: No action yet on the State Senate floor.  Both houses adjourned for summer recess for work in their individual member districts from July 15th to August 15th, when the Senate and Assembly will re-convene.  This bill can remain active in the Legislature until next year - though the immediate issues raised in this bill would have had to have been resolved long before then.   
EFFECTIVE DATE:  Effective upon approval of the Governor (or as provided for in the bill)
CDCAN COMMENT:  The bill was held in the Senate after a letter was received July 14th, Thursday afternoon from  Toby Douglas, director of the Department of Health Care Services saying the Brown Administration would be delaying the effective date for at least 30 days (from September 1st to at least October 1st) and possibly longer if needed.
This bill does not rescind the elimination of Adult Day Health Care as a Medi-Cal optional benefit, but delays the effective date by another 60 days (November 1, 2011 instead of the current effective date of September 1, 2011). The federal government is expected to approve this request.  With delay of the effective date of the elimination of Adult Day Health Care as a Medi-Cal benefit from September 1st to December 1st, this bill is no longer necessary in its current form.  The Legislature can change or amend it when they reconvene in August, if there is a need to do so.
See also SB 91 which was also approved today dealing with delinking the Medi-Cal certification as one of the requirements for State licensure of Adult Day Health Care centers to allow those centers to operate beyond the date the Medi-Cal optional benefit it eliminated, and also to allow them to accept persons into their programs who are not on Medi-Cal.
LATEST VERSION OF BILL - HTML:  http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_97_bill_20110714_amended_asm_v98.html
LATEST VERSION OF BILL - PDF: http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_97_bill_20110714_amended_asm_v98.pdf
PRIORITY: VERY HIGH

AB 96 - ADULT DAY HEALTH CARE: KEEPING ADULTS FREE FROM INSTITUTIONS ("KAFI")

AUTHOR: Assemblymember Bob Blumenfield (Democrat - Van Nuys)
CDCAN SUMMARY:  Would authorize the creation of a new model of Adult Day Health Care (ADHC) program, under a federal Medicaid Waiver, as follows:

• States legislative intent  to create the "Keeping Adults Free from Institutions" (KAFI) program, to provide community services that prevent institutionalization; that  the KAFI program allow recipients of Adult Day Health Care  be given  priority in transitioning; and, that the new program be established as quickly as possible.
• Require the Department of Health Care Services to submit an application for a federal waiver, to implement the KAFI program, by September 1, 2011;
• Require the KAFI program to utilize licensed adult day health centers to provide medical, behavioral health, and social services to Medi-Cal recipients who are at high risk of institutionalization;
• Authorize the Department of Health Care Services to implement the KAFI program by way of a state plan amendment to the State's Medicaid State Plan, federal waiver, or both; and,
• Require federal approval, federal financial  participation (federal matching funds) and an appropriation in the Annual Budget Act for implementation of KAFI.

PREVIOUS ACTION 06/15/2011: PASSED Assembly by vote of 54 to 24.  (PASSED State Senate by vote of 24 to 15 on 06/10/2011)
LATEST ACTION 07/14/2011: Sent to Governor at 3:15 PM.
NEXT STEPS: The Governor has 12 calendar days from the date he received the bill to sign or veto it (or allow to become law without his signature) - meaning until 11:59 PM on July 25th (Monday).   
CDCAN COMMENT: A related bill, SB 91, has not yet been sent to the Governor (but is being prepared to be sent).  A veto of AB 96 would signal - as some advocates fear - a position by the Brown Administration not to continue Adult Day Health Care in any form.  See below for full text of this bill - and also attached as a pdf file)
LATEST VERSION OF BILL - HTML: http://www.leginfo.ca.gov/pub/11-12/bill/asm/ab_0051-0100/ab_96_bill_20110714_enrolled.html
LATEST VERSION OF BILL - PDF:  http://www.leginfo.ca.gov/pub/11-12/bill/asm/ab_0051-0100/ab_96_bill_20110714_enrolled.pdf
PRIORITY: VERY HIGH

TEXT OF AB 96 - "KEEPING ADULTS FREE FROM INSTITUTIONALIZATION"

This is the version of AB 96 that was passed by the Assembly and State Senate in mid-June and then sent to the Governor on July 14th.  The Governor has 12 days to act on this bill from the date he received it:  The appropriation of $1,000 in State general fund in this budget trailer bill (and all others) is to make it officially a budget related bill that falls under the requirements of Proposition 25 (allowing for passage by a majority vote - and because it is a budget trailer bill connected to the main budget bill, to take effect immediately):

BILL NUMBER: AB 96 ENROLLED
BILL TEXT

PASSED THE SENATE  JUNE 10, 2011
PASSED THE ASSEMBLY  JUNE 15, 2011
AMENDED IN SENATE  JUNE 8, 2011
AMENDED IN SENATE  APRIL 6, 2011
AMENDED IN SENATE  MARCH 14, 2011

INTRODUCED BY   Committee on Budget

                        JANUARY 10, 2011

   An act to add Chapter 8.6 (commencing with Section 14515) to Part 3 of Division 9 of the Welfare and Institutions Code, relating to Medi-Cal, making an appropriation therefor, to take effect immediately, bill related to the budget.

LEGISLATIVE COUNSEL'S DIGEST

   AB 96, Committee on Budget.  Keeping Adults Free from Institutions program.

   Existing law establishes the Medi-Cal program, administered by the State Department of Health Care Services, under which health care services are provided to qualified, low-income persons. The Medi-Cal program is, in part, governed and funded by federal Medicaid Program provisions. Existing law provides, to the extent permitted by federal law, that adult day health care (ADHC) be excluded from coverage under the Medi-Cal program.

   This bill would provide that it is the intent of the Legislature to create the Keeping Adults Free from Institutions (KAFI) program, which shall be a new program to provide services in the community that are designed to prevent institutionalization, and that the KAFI program be established as quickly as possible to minimize any disruption in services resulting from the elimination of ADHC as a Medi-Cal benefit.  This bill would prohibit the KAFI program from being implemented until federal approval is obtained, and provide that the KAFI program is to be implemented only to the extent that federal financial participation is available.  This bill would require the department to submit, on or before September 1, 2011, an application to the federal Centers for Medicare and Medicaid Services (CMS) to implement the KAFI program.  This bill would require the KAFI program to utilize licensed adult day health centers to provide a well-defined scope of specified services for Medi-Cal beneficiaries who have been assessed to be at significant risk of institutionalization. This bill would require the department to consult with interested stakeholders and the Legislature in developing the application to CMS and would authorize the department to implement these provisions by means of a state plan amendment or federal waiver, or combination thereof.

   This bill would appropriate $1,000 to the department for administration.

   This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.

   Appropriation: yes.

THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Chapter 8.6 (commencing with Section 14515) is added to Part 3 of Division 9 of the Welfare and Institutions Code, to read:

      CHAPTER 8.6.  KEEPING ADULTS FREE FROM INSTITUTIONS

   14515.  (a) It is the intent of the Legislature to create the Keeping Adults Free from Institutions (KAFI) program, which shall be a new program to provide services in the community that are designed to prevent institutionalization.

   (b) It is the intent of the Legislature that the KAFI program allow recipients of adult day health care pursuant to Chapter 8.7 (commencing with Section 14520), who are at the greatest risk of institutionalization, to be given immediate priority to transition to the new program.

   (c) It is the intent of the Legislature that the KAFI program be established as quickly as possible to minimize any disruption in services resulting from the elimination of adult day health care as a Medi-Cal optional benefit.

   14516.  (a) On or before September 1, 2011, the department shall submit an application to the federal Centers for Medicare and Medicaid Services (CMS) to implement the Keeping Adults Free from Institutions (KAFI) program. This program shall utilize licensed adult day health centers, as defined in subdivision (b) of Section 1570.7 of the Health and Safety Code, to provide a well-defined scope of medical, behavioral health, and social services for Medi-Cal beneficiaries who have been assessed using evidence-based risk factors to be at significant risk of institutionalization, including admission or readmission to an institutional setting in the absence of community-based services. The KAFI program shall achieve all of the following:

   (1) Promote person-centered care planning.

   (2) Work in coordination with existing state programs, including other federal waivers and pilot projects that have, as one of their goals, to delay or prevent inappropriate or personally undesirable institutionalization.

   (3) Emphasize partnership between the participant, the participant' s family, the personal health care provider, and other community care providers in working toward maintaining personal independence.

   (4) Facilitate the beneficiary's choice to the extent feasible.

   (b) The department may implement this chapter by means of a state plan amendment or federal waiver, or a combination thereof, as necessary to accomplish the intent of this chapter. The department shall seek to maximize the availability of federal financial participation for implementation of this chapter under the terms of any existing waivers or state plan provisions, through amendment of any existing waivers or state plan provisions, or by means of a new waiver or state plan amendment, or any combination thereof.

   (c) In developing the application to CMS pursuant to this section, the department shall consult with interested stakeholders and the Legislature.

   (d) Notwithstanding the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code), the department may implement this chapter through all-county letters or similar instructions, without taking regulatory action. Prior to issuing any letter or similar instruction authorized pursuant to this subdivision, the department shall notify and consult with stakeholders, including advocates, providers, and beneficiaries, in implementing, interpreting, or making specific this chapter.

   14516.5.  (a) The director shall seek any necessary federal approvals for the implementation of the KAFI program. The KAFI program shall not be implemented until federal approval is obtained and shall be implemented only to the extent that federal financial participation is available.

   (b) Implementation of the KAFI program is subject to an appropriation in the annual Budget Act.

  SEC. 2.  The sum of one thousand dollars ($1,000) is hereby appropriated from the General Fund to the State Department of Health Care Services for administration.

  SEC. 3.  This act is a bill providing for appropriations related to the Budget Bill within the meaning of subdivision (e) of Section 12 of Article IV of the California Constitution, has been identified as related to the budget in the Budget Bill, and shall take effect immediately.

File Attachments: 

2011-07-21-ADHC Extension Approval Letter.pdf (910.02 KB)