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Schwarzenegger Administration Proposal to Federal Government To Renew and Expand Existing Section 1115 Medicaid Waiver Would Make Sweeping Changes to Medi-Cal Program Impacting Children and Adults with Disabilities, Mental Health Needs, the Blind and Seniors

SACRAMENTO, CALIF (CDCAN) [Updated 12/09/09 08:17 PM (Pacific Time)] - Under the shadow of a growing state budget deficit, a proposal by the Schwarzenegger Administration to be submitted to the federal government that seeks renewal and expansion of an existing Medicaid waiver that - if approved - would make sweeping changes to the state’s Medi-Cal program, is the focus of a legislative informational hearing and a legislative briefing, both scheduled for Thursday, December 10th:

• Assembly Health Committee informational hearing at 09:00 AM at the State Capitol in Room 126
• An informal briefing organized by the Senate Rules Committee that starts at 10:30 AM also at the State Capitol in Room 2040.

Both the hearing and briefing are open to the public. The hearing by the Assembly Health Committee follows a similar informational hearing on the proposed waiver – referred to as the “Section 1115 Medicaid Waiver” – was held November 18th by the Senate Health Committee chaired by State Sen. Elaine Alquist (Democrat – Santa Clara). The Senate briefing is a follow-up to the “Medi-Cal Waiver 101” briefing organized by the Senate Office of Research earlier this year.

Major Impact to Children and Adults With Disabilities, Mental Health Needs, the Blind and Seniors

The current proposal to renew and expand the existing Section 1115 Medicaid Waiver, among other things, would propose shifting over a phased in period of five years, nearly all of the population of children and adults with disabilities (including those with traumatic brain and other injuries), the blind, mental health needs and seniors currently who receive Medi-Cal under the “fee for service” program into an “organized delivery systems of care” that could use existing managed health care systems or create new systems, including newly developed “enhance medical home” models. The proposed changes will have likely major impact on thousands of children with autism spectrum disorders who will be reaching adulthood in the next several years and who will be in need of Medi-Cal and other healthcare services and supports.

The Schwarzenegger Administration says in the concept paper that the current Medi-Cal “fee for service” system (where a Medi-Cal recipient chooses their own doctor or health service who in turn bills Medi-Cal) is uncoordinated and does not bring together or integrate primary, acute, behavioral health, and social and long term care support needs – forcing Medi-Cal recipients to use a mix of services that are administered and paid for by different systems. The concept paper says that those persons enrolled in Medi-Cal managed care health plans face a similar problem when in need of specialty mental health services which currently is “carved out” of those plans – requiring those Medi-Cal recipients to seek help outside of those plans or not at all.

The current changes and reforms to health care being considered by Congress could have potential impact on how this waiver proposal is finalized.

The issue of requiring persons with disabilities, the blind, persons with mental health needs and seniors into Medi-Cal managed care plans, especially combined with other significant health and human services budget reductions, is a major concern to many advocates and advocacy groups for those populations who fear that critical and specific healthcare needs and services will not be met. Over the years advocates have raised concerns whether existing and proposed Medi-Cal managed care plans are “ready” to provide quality healthcare services to persons with disabilities, the blind, mental health needs and seniors, and questioned whether physical health facilities and equipment for those plans are accessible for those populations. Many advocates have said in public hearings and in position papers and letters that many of the existing Medi-Cal managed care plans and facilities are not ready or prepared.

Proposal Required As Part of 2009-2010 Revised State Budget Passed Last July

The concept paper and official detailed proposal to the federal government, required in ABx4 6 (“x4” stands for 4th special or extraordinary session) as part of the budget agreement passed by the Legislature and approved by the Governor in late July, is part of a larger proposal to the federal government that seeks to renew the existing Section 1115 Waiver under the federal Medicaid rules, which currently only deals with hospital financing and uninsured care, set to expire August 2010. [CDCAN Note: it is called “Section 1115” because that is the section of the federal Social Security Act that the waiver allows a state to be exempted – waived – from.]

The proposal comes under the cloud of more bad news of a growing state budget deficit, and is meant to control the growth in Medi-Cal spending. The proposal was outlined originally as part of Governor Arnold Schwarzenegger’s proposed budget revisions submitted to the Legislature in May 2009, though the overall concept of “redesigning” the Medi-Cal program including movement from the “fee for service” program into some form of organized or other managed health care plans was previously proposed by the Governor in 2004 under his “Medi-Cal Redesign” proposal. That proposal – which included a series of public workshops and meetings – died.

Over the years, both Governor Gray Davis and Governor Arnold Schwarzenegger proposed reimbursement cuts to Medi-Cal “fee for service” providers – though various lawsuits in federal court blocked – most recently last August, November and in February, blocked nearly all of those reductions. Cuts were also proposed and made over the years to various Medi-Cal managed care plans.

The Medicaid 1115 Waiver proposal is one of several different measures to contain and control growths in spending not only in Medi-Cal but in other fast growing programs. State policymakers both in the Schwarzenegger Administration and in the State Legislature – as they have done in previous years - are looking at several health and human service programs – including regional center funded community based services for children and adults with developmental disabilities, In-Home Supportive Services and CalWORKS (the State’s “welfare to work” program that also includes persons with special needs) – and how to control growing costs and caseloads. With a budget deficit projected for the 2010-2011 state budget year estimated at over $20 billion, proposals to control those costs and caseloads are almost certain to be part of the Governor’s proposed budget that he will be submitting to the Legislature by January 10th.

Waiver Proposal To Be Fleshed Out Over the Next Several Months

At this point, the proposal is contained at this point in a “concept paper” titled “State of California’s Concept for a Comprehensive Section 1115 Waiver to Replace the Current Medi-Cal Hospital/Uninsured Care Demonstration Project” that the Department of Health Care Services – the state agency that oversees the Medi-Cal program – is submitting to Centers on Medicare and Medicaid Services (CMS), the federal agency that is responsible for the nation’s Medicare and Medicaid programs.

For more information about the Section 1115 Waiver renewal, go to the Department of Health Care Services website page for this at (including subscribing to free updates on the waiver renewal) [The copy of the 11 page concept paper can also be viewed or downloaded on the CDCAN website at www.cdcan.us ] :

http://www.dhcs.ca.gov/provgovpart/Pages/WaiverRenewal.aspx

For specific questions on the waiver renewal, persons can email: WaiverRenewal@dhcs.ca.gov

The concept paper, which was developed over the past several weeks after the revised budget was passed and enacted last July, contains no specific details, is the first concrete step to the federal government from the state in moving forward in renewing – and expanding – the Section 1115 Medicaid waiver. It was presented to the Olmstead Advisory Committee on November 5th and is meant to give the federal government a general outline of what the state would like to do if the waiver is renewed – which in turn will generate questions, clarifications and other points – before the more detailed and specific proposal is submitted (sometime early next year).

ABx4 6 also requires the Department of Health Care Services to convene and consult with a “stakeholder advisory group” in developing the waiver and the implementation plan and requires that group to remain in place to advise on the continued operation of the waiver.

It also requires this stakeholder group to include, but not be limited to persons with disabilities, seniors, legal services agencies, specialty care providers, physicians, hospitals, county government, and labor.

DECEMBER 10TH ASSEMBLY HEALTH COMMITTEE HEARING INFORMATION

The Assembly Health Committee, chaired by Assemblymember Dave Jones (Democrat – Sacramento), has scheduled a 2 hour informational hearing focusing on the overall current status and objectives and impact of the Section 1115 Medicaid waiver renewal. The committee will not be taking any votes or formal action. There may be an opportunity for limited public testimony and comments.

When: December 10, 2009, Thursday, from 09:00 AM to 11:00 AM.
Where: State Capitol, Room 126
Who: Assembly Health Committee
What: Informational Hearing
Subject: Medi–Cal: California’s Proposed Medi–Cal Hospital/Uninsured Care Demonstration Project/Waiver Renewal

DECEMBER 10th SENATE MEDI-CAL WAIVER DISCUSSION

Also on December 10th, is a separate informal briefing organized by Senate Rules Committee staff, to discuss how the Medicaid Section 1115 Waiver concept of moving children and adults with disabilities, the blind, persons with mental health needs, seniors into “organized systems of care” that can include existing Medi-Cal managed health care plans and to get a better idea of how current Medi-Cal managed health care plans provide services to those populations. This meeting – open to the public - is a follow up to the “Medi-Cal Waiver 101” briefing organized by the Senate Office of Research earlier this year.

When: December 10, 2009, Thursday, from 10:30 AM to 12:30 PM
Where: State Capitol, Room 2040
Subject: Medi-Cal Waiver Discussion - How Medi-Cal Managed Care Plan Manage Care for Complex/High Risk Beneficiaries
Panel Participants:

• County Organized Health Care Systems (existing Medi-Cal Managed Health Care Plans)
  • Richard Chambers, Exec. Director, CalOptima
  • Maya Altman, Exec. Dir., Health Plan of San Mateo
• Local Initiatives
  • Dr. Brad Gilbert, Chief Executive Officer (CEO), Inland Empire Health Plan (EHP)
  • Ingrid Lamirault, Chief Executive Officer (CEO), Alameda Alliance for Health (AAH)

  Commercial Plans

  • Dr. Jennifer Nuovo, MD, Chief Medical Officer for state health programs, Health Net
  • Dr. Richard Bock, MD, Chief Medical Officer, Molina Health Plan

• Issues likely to be discussed during the briefing include:
  • Does their managed health care plan use a “medical home” model?
  • What does the “medical home” model do?
  • How does their managed health care plan deal with behavioral health issue
  • How does their managed health care plan measure outcomes?

ALSO SCHEDULED: SENATE HEALTH COMMITTEE HEARING IMPACTING PERSONS WITH TRAUMATIC BRAIN INJURIES

Though not specifically part of the proposed Section 1115 Medicaid Waiver – though potentially connected to it because it impacts the same or similar groups of people, is an informational hearing next month on January 13th, by the Senate Health Committee, chaired by State Sen. Elaine Alquist (Democrat – Santa Clara) focusing on new approaches in the care and treatment of persons with traumatic brain injuries.

When: January 13, 2010, Wednesday at 1:30 PM
Where: State Capitol, Room 4203
Who: Senate Health Committee
What: Informational hearing
Subject: “New Approaches in the Care and Treatment of Persons with Brain Injury”