CDCAN REPORT #185-2011: Department of Social Services seeks comments on draft notices for 20% reduction in IHSS service hours

DEPARTMENT OF SOCIAL SERVICES SEEKS COMMENTS ON DRAFT NOTICES TO IHSS RECIPIENTS AND COUNTIES TO IMPLEMENT POSSIBLE 20% ACROSS THE BOARD CUT IN IHSS SERVICE HOURS IN JANUARY

Notices Will Go Out In December IF State Budget "Trigger Cuts" Are Pulled

SACRAMENTO, CA (CDCAN) [Last updated 11/01/2011 06:20 PM] - The Department of Social Services under the Brown Administration released late this afternoon draft copies of notices to In-Home Supportive Services (IHSS) recipients and instructions to the counties regarding implementation of a 20% across the board reduction in service hours to all persons receiving In-Home Supportive Services, effective January 2012 - if a certain amount of state budget revenues will not come in as hoped for, triggering one or both of the state budget "trigger cuts" (the state budget "trigger cuts" are different from the federal budget "trigger cuts").

The five notices, applications, worksheet and draft notice to the counties was sent out by Charissa S. Miguelino, Chief of the Adult Programs Policy and Operations Bureau in the Department of Social Services.  (see below for details on the draft documents, deadlines and who to send comments to).

Though no decisions on the State Budget "trigger cuts" have yet been made - and will not be made until December - the draft versions of these notices and documents are being sent out for advocates and other stakeholders to review to make sure the information is correct and understandable and complies with State and federal laws and to have the documents ready just in case they are needed.

20% Across the Board Cut - If Implemented - Would Be In Addition To Existing 3.6% IHSS Reduction

The 20% reduction - which allows for certain exemptions for certain persons - would amount to at a reduction of at least $100 million in State general fund spending for IHSS in the remaining 6 months of the 2011-2012 State budget year that ends June 30, 2012. The 20% reduction - if the State budget trigger cut is pulled - would be in addition to the existing 3.6% reduction in most IHSS recipient authorized monthly service hours that took effect February 1, 2011.  The 3.6% reduction is currently set to continue until June 30, 2012. That means, if the State budget "trigger cut" is pulled, a person with disabilities, mental health needs, the blind or seniors in the IHSS program could face a total reduction in service hours of 23.6%.

The Department of Developmental Services budget would also face a $100 million reduction in State general fund spending to be effective on or sometime after January 1, 2012, if the State budget "trigger cut" is pulled - though the cuts to that budget are not specified at this point.

Hundreds of Thousands of People Could Be Impacted

• If the State budget "trigger cuts" are pulled and this reduction does take effect in January 2012, hundreds of thousands of children and adults with disabilities - including those with developmental disabilities - people with mental health needs, the blind, low income seniors would be impacted with a dramatic loss in hours of support services in their own homes.
• In addition, hundreds of thousands of their support workers.could face a significant loss in working hours that could impact - for some - health care and other benefits.
• The reduction - if it does go into effect - does allow for exemptions for those who are at serious risk of out of home placement if they lost 20% of their service hours.  But advocates say that tens of thousands of people receiving IHSS are "terrified" or in a "panic" of the possibility of losing 20% of their support services that they say is crucial to remain safely in their homes - but may not reach the threshold for an exemption or qualify for other exemptions.

Decision on State Budget Trigger Cuts To Be Made By Department of Finance Director By Dec 15th

No decision has yet been made on whether or not the State budget "trigger cuts" will be pulled - a decision that will not be made on or before December 15th by the director of the Governor's Department of Finance.  However the department wants to make sure all the required notices and information are ready to go in December should one or both State budget triggers are pulled.

There are growing concerns and fears among many advocates and some policymakers that State revenues will fall below $1 billion less than what was budgeted and will likely mean that the first State budget trigger cut - largely health and human services and higher education will be pulled.  The second trigger is pulled if State revenues are projected in December to be $2 billion less than what was budgeted, implementing automatic massive cuts of at least $1.5 billion to K-12 education and more cuts to higher education. (see below for details on the State budget "trigger cuts".)

How the IHSS Reductions Would Work - IF State Budget "Trigger Cut" Is Pulled

The specific reductions to IHSS are in SB 73 as passed by the Legislature in March and signed into law by Governor Brown that month:

• Recipients may choose how the total reduction in service hours is applied to their individual authorized services if the State budget "trigger cut" is pulled.
• The reduction - if the State budget "trigger cut" is pulled - will not be applied to individuals receiving IHSS who also receive services under one of the State Home and Community Based Services Waivers, including the following: Acquired Immune Deficiency Syndrome (AIDS) Waiver, Home and Community-Based Services Waiver for the Developmentally Disabled (HCBS-DD), In-Home Operations (IHO), Multipurpose Senior Services Program (MSSP), and Nursing Facility/Acute Hospital (NF/AH.)
• If the State budget "trigger cut" is pulled, the 20% reduction will first be applied to any documented unmet need, excluding protective supervision, before being applied to authorized hours.
• Any IHSS recipient who receives notice of the reduction in authorized services (if the State budget "trigger cut" is pulled) and who believes that the reduction puts him/her at serious risk of placement in out-of-home care may submit an application for IHSS Supplemental Care to request full or partial restoration of his/her reduced hours.
• The California Department of Social Services shall work with counties to develop a process to allow for counties to preapprove IHSS Supplemental Care requests if the State budget "trigger cut" is pulled (see attached Draft Supplemental Care application form).

HOW TO COMMENT ON THE DRAFT NOTICES AND DOCUMENTS

• Not everyone has to comment on the draft notices and draft instructions to the counties and draft worksheet for county workers.  However even if a person is not going to comment - it is a good idea to review the documents to have an idea of what COULD happen if the State budget "trigger cut" is pulled impacting IHSS.
• Comments for these draft documents need to be focused on the content - making sure it compiles with federal, state laws and that the content is understandable and clear.  Comments about the wisdom (pro or con) of the reduction should be sent in a separate letter or other communication to one's own State senator or assemblymember or to the Governor's office.
• These are DRAFT documents. No decision has yet been made on whether the State budget "trigger cut" will be pulled that would require this additional cut to IHSS - and cuts to other health and human service programs and higher education.
• Comments should be brief and to the point.
• Deadline to send comments regarding the forms, notice of action and application: November 7, 2011 (Monday)
• Deadline to send comments regarding draft All County letter: November 17, 2011 (Thursday)
• Note: if multiple comments from one group is being sent the Department of Social Services asks if those groups can assist by combining their comments into a single document)
• Send Comments Regarding Draft Documents to the Department of Social Services:
  • Brad Elftmann at Brad.Elftmann@dss.ca.gov  and
  • Marc Engstrom at Marc.Engstrom@dss.ca.gov 

DRAFT DOCUMENTS

The following DRAFT documents are attached to this CDCAN Report (note all documents were created and saved by the Department of Social Services as word documents, that should enable people who are blind or sight impaired to read using a screen reading device) are not listed below in any particular order:

1. DRAFT ALL COUNTY LETTER (NOTICE TO COUNTIES)
PURPOSE: this notice - called an "All County Letter" goes to all county welfare departments, county IHSS program offices and other county agencies that describes the reduction, gives background of the reduction and other information.  It does not normally go to IHSS recipients - though recipients and others can download the official copies from the Department of Social Services website (CDCAN routinely sends out final versions of these notices).
NUMBER OF PAGES: 12
ATTACHMENT TITLE: "2011-11-01 - DRAFT - All County Letter (2011-11-01 v3).pdf"

2.  DRAFT IHSS SUPPLEMENTAL CARE (SCREENING TOOL)
PURPOSE: for use by IHSS county workers to fill out for those IHSS recipients who could face serious risk of out of home placement if they were subjected to a 20% across the board service reduction in IHSS (if State budget trigger cut is pulled).
NUMBER OF PAGES:  1
ATTACHMENT TITLE:  "2011-11-01 - DRAFT - IHSS Supplemental Care Worksheet (2011-11-01).pdf"

3. DRAFT APPLICATION FOR IHSS SUPPLEMENTAL CARE
PURPOSE: for use by those IHSS recipients who may be eligible for an exemption to the 20% across the board reduction in IHSS hours if they cut would place them in serious risk of out of home placement.
NUMBER OF PAGES: 1
ATTACHMENT TITLE: "2011-11-01 - DRAFT - Application for IHSS Supplemental Care (2011-10-31 v3).pdf"

4. DRAFT NOTICE OF ACTION (FRONT SIDE)
PURPOSE: two sided notice of action would go to all IHSS recipients (if State budget trigger cut is pulled). This front side describes the reduction and who it will impact and who might qualify for an exemption (supplemental care).
NUMBER OF PAGES: 1
ATTACHMENT TITLE:  "2011-11-01 - DRAFT - Notice of Action to IHSS Recipients (front side) (2011-10-31 v3).pdf"

5. DRAFT NOTICE OF ACTION (BACK SIDE)
PURPOSE: two sided notice of action would go to all IHSS recipients (if State budget trigger cut is pulled).  This back side informs the IHSS recipients of their rights to appeal.
NUMBER OF PAGES: 1
ATTACHMENT TITLE: "2011-11-01 - DRAFT - Notice of Action (back side) English (2011-11-01).pdf"

State Budget "Trigger Cuts" Pulled If State Doesn't Bring in $88.5 Billion In Revenues This Year

• Back in late June, with Legislative Republicans opposed to any tax increases, Legislative Democrats and the Governor opted for putting in higher revenue numbers in the 2011-2012 State Budget tied to "triggers" that would impose automatic spending cuts later in December - rather than being forced to making additional massive spending cuts then in June when the budget was passed.
• The State budget "trigger cuts" would be pulled if it is determined that the amount of State revenues - $88.5 billion - will not come in as hoped for in the 2011-2012 State Budget.
• The Governor's Department of Finance director will make that determination on or by December 15 this year, based on numbers from the department's own revenue analysis and information from the non-partisan Legislative Analyst Office (LAO). [CDCAN Note: see below for details on the State budget "trigger cuts" and summary of budget trailer bill, SB 73 that deals with health and human services related cuts if trigger is pulled - Marty Omoto]
• The actual State budget revenue and spending numbers released October 10th by the State Controller suggests that the California economy, while showing some improvement, is not bringing in revenues as hoped for in the 2011-2012 State Budget - and that could mean, if the trend continues - that one or both of the State budget "trigger cuts" will likely be pulled.
• However some in the State Capitol believe, if revenues continue to drop, that the Governor could call a special session of the Legislature later in the year to re-open the issue of how to resolve the budget gap - and deal with additional mid-year spending cuts.  While nothing is certain yet, many budget watchers however are convinced now that some level of mid-year spending reductions are likely to occur. At this point, no one really knows what will ultimately happen in December.

State Budget "Trigger Cuts" Differ From Washington DC "Trigger Cuts"

The State budget "trigger cuts" are different from the federal "trigger cuts" that will be pulled if a special joint Congressional committee in Washington, DC - known as the "Super Committee" - does not come up with a recommended list of at least $1.2 trillion in spending cuts or if Congress fails to approve their recommendations in a straight up or down vote, if they do.

If Congress fails to act by the late November and December deadlines, automatic spending cuts of $1,2 trillion will take effect January 1, 2013, though some programs - including Medicaid and Social Security are exempted from those automatic cuts (but not exempted from cuts that the "Super Committee" can recommend).

In California, the State budget "trigger cuts" will be pulled - triggering up to $2.5 billion in automatic spending cuts in specific budget areas - if the State's $88.5 billion in projected revenues do not come in at a certain level as budgeted.

• If State revenues are forecast in December 2011 to be lower by $1 billion to $2 billion, the first State budget "trigger" is pulled, triggering $600 million in automatic spending cuts for specific programs, effective on or sometime after January 1, 2012.
• If State revenue numbers in December 2011 are forecast to be lower by more than $2 billion, then the second State budget "trigger" is pulled, triggering spending cuts of up to $1.9 billion

Outline of the State Budget "Trigger Cuts" Process

• Requires the Governor's Department of Finance to provide notification to the Joint Legislative Budget Committee by December 15, 2011, with an updated revenue forecast for the 2011-2012 State Budget that is based on the higher of either the November 2011 Legislative Analyst’s revenue forecast, or the Department of Finance’s December 2011 revenue forecast.
• Requires that the Director of Finance notify the Joint Legislative Budget Committee of any trigger reduction within 10 days of the reduction.
• There are some questions - and differences of opinion - under just what conditions can a trigger be pulled - or not - and if pulled, the effective dates of cuts and whether or not all of the savings (reductions) have to be achieved before the end of the 2011-2012 State Budget year (that ends June 30, 2012).
• In addition there are OTHER "trigger cuts" in the 2011-2012 State Budget, including a different one impacting In-Home Supportive Services if it is determined in 2012 that a certain level of savings will not be achieved via proposals that hope to bring down $140 million in new federal matching funds. That "trigger cut" is not part of the "trigger cuts" tied to the overall State Budget projected revenues described below.

If the December 15, 2011, updated forecast of revenues predicts revenues less than $87.5 billion, the following additional spending cuts - called “Tier I” reductions, which total about $601 million, shall occur up to the amount that is specified. These reductions, if triggered, would take effect on or after January 1, 2012:

• $100 million to the University of California.
• $100 million to the California State Universities.
• $100 million to the Department of Developmental Services.(can be reduced from the developmental services system, including State administration,Developmental Centers, and Regional Center expenditures. A "variety of strategies" may be used for purposes of identifying savings, including, but not limited to, savings attributable to caseload adjustments, changes in expenditure trends, or other administrative savings or restructuring according to the budget trailer bill language).
• $110 million to the In-Home Supportive Services program, including $100 million in service hour cuts, and $10 million for local anti-fraud efforts (an across-the board reduction in IHSS services of 20% beginning January 1, 2012, with specified notice requirements and exceptions. According to legislative budget analysis of this cut, if this trigger is pulled, the resulting reduction would affect about 374,000 IHSS recipients and would generate approximately $100 million in State general fund reductions in 2011-2012 and $242.8 million in State general fund reductions (or savings) in subsequent full budget years.)
• $92 million to the Department of Corrections and Rehabilitation (CDCR), including:

• $72.1 million in increased county charges for youthful offenders sent to CDCR.
• $30 million to the California Community Colleges backfilled with a $10 per unit fee increase.
• $23 million to the Department of Education related to childcare funding.
• $16 million to the California State Library related to library grants.
• $15 million to the California Emergency Management Agency related to local vertical prosecution grants.
• $15 million to Medi-Cal from extending the March 2011 cuts to all managed care plans.

If the December 15, 2011, updated forecast of revenues (the higher forecast by either the Legislative Analyst Office or the Department of Finance) projects revenues less than $86.5 billion, then the second trigger is pulled and ADDITIONAL round of automatic spending cuts of $1.9 billion - called "Tier 2" reductions - on top of the $601 million would be implemented on or after January 1, 2012; however, the reduction impacting schools to the 2011-2012 school year would take effect on or after February 1, 2012:

• $1.5 billion from reducing the 2011-12 school year by up to 7 days.
• $248 million from eliminating dedicated funding for home-to-school transportation.
• $72 million to the California Community Colleges related to an apportionment decrease.

Summary of Budget Trailer Bill Dealing With Health and Human Services Trigger Cuts

For specific information about the trigger cuts as it relates to health and human services program cuts, see SB 73 (one of the 18 budget trailer bills that make up the 2011-2012 State Budget as passed and signed into law in June):

SB 73 - BUDGET TRIGGER: HEALTH AND HUMAN SERVICES

AUTHOR: Senate Budget and Fiscal Review Committee
CDCAN SUMMARY:  Makes changes in State law to allow for implementation of $200 million in reductions in State general fund spending in the health and human services budget, that is part of the $2.5 billion in "trigger cuts".  Would make $15 million in reductions to Medi-Cal impacting PACE (Program for All Inclusive Care for the Elderly, AIDS Foundation and Senior Action Network; $100 million in State general fund cuts to developmental services to be identified by the Department of Developmental Services from across the developmental services system and $100 million in across the board cuts in State general funding to In-Home Supportive Services
PREVIOUS ACTION 06/28/2011: PASSED Assembly by vote of 51 to 28. PASSED State Senate by vote of 23 to 17. Sent to Governor at 09:50 PM.
LATEST ACTION 06/30/2011: SIGNED by Governor.
EFFECTIVE DATE: Immediate upon signature of Governor.
COPY OF BILL (CHAPTERED VERSION AS APPROVED BY GOVERNOR) - HTML:  http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_73_bill_20110630_chaptered.html
COPY OF BILL (CHAPTERED VERSION AS APPROVED BY GOVERNOR) - PDF: http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_73_bill_20110630_chaptered.pdf
CDCAN COMMENT:
* There are a total of three bills dealing with the budget "trigger" - including one (AB 121) that gives authority to the Governor's Department of Finance to determine whether sufficient level of new revenues are coming in as projected by January 2012 - and then to implement certain levels of cuts up to $2.5 billion if it is determined that revenues are not coming in as projected.  AB 121 only lists budget area numbers and spending reduction amounts and the conditions that those reductions would be made)
For html version of AB 121:  http://www.leginfo.ca.gov/pub/11-12/bill/asm/ab_0101-0150/ab_121_bill_20110630_chaptered.html
For pdf version of AB 121: http://www.leginfo.ca.gov/pub/11-12/bill/asm/ab_0101-0150/ab_121_bill_20110630_chaptered.pdf
*  The other two bills deals with the specific levels of reductions that would occur in K-12 education and - this bill (SB 73) - on health and human services should the triggers be pulled in January 2012.  
PRIORITY:  VERY HIGH

File Attachments: 

2011-11-01 - DRAFT - All County Letter (2011-11-01 v3).pdf (177.82 KB)

2011-11-01 - DRAFT - Application for IHSS Supplemental Care (2011-10-31 v3).pdf (117.78 KB)

2011-11-01 - DRAFT - IHSS Supplemental Care Worksheet (2011-11-01).pdf (153.01 KB)

2011-11-01 - DRAFT - Notice of Action (back side) English (2011-11-01).pdf (39.87 KB)

2011-11-01 - DRAFT - Notice of Action to IHSS Recipients (front side) (2011-10-31 v3).pdf (93.54 KB)