November 16, 2017

Governor Brown concluded legislative business by the October 15 deadline, ultimately signing 859 bills into law. CSAC is publishing a series of updates on new laws from each policy area. This week, the report from the Health and Human Services policy unit provides information on the following legislation that has been enacted by the Legislature and signed by the Governor.

Other policy area reports on new laws can be found at these links:

• Administration of Justice
• Agriculture, Environment and Natural Resources
• Government Finance and Administration
• Housing, Land Use and Transportation

Budget Bills

SB 90 (Committee on Budget and Fiscal Review) and AB 130 (Committee on Budget) together comprised the In-Home Supportive Services (IHSS) trailer bills. The major legislative accomplishment of the session in health and human services was negotiating an IHSS agreement with the Administration that will result in significantly reduced county contributions for IHSS costs compared to the January budget. The agreement included the establishment of a new County MOE with an annual inflator, State General Fund contributions to partially offset the cost shift including $400 million in 2017-18, additional redirected revenues to offset IHSS costs, and a requirement to reexamine the funding structure during the development of the 2019-20 state budget in consultation with counties. The IHSS agreement was passed in a budget trailer bill (SB 90) in June, and a methodology was approved by the CSAC Board of Directors on September 7. During the last week of session, CSAC also supported AB 130, another trailer bill that included technical clean-up provisions to ensure proper implementation of SB 90. AB 130 was passed by the Legislature on September 15 and the Governor on September 16.

Health and Mental Health Services Act Funding

SB 97 (Beall) creates a framework to ensure that unspent Mental Health Services Act (MHSA) funding would revert back to the state as outlined in Proposition 63 passed by voters in 2004. After many discussions, a slightly different framework was included in the Health budget trailer bill in June (SB 97). The measure provides a prospective solution for the reversion of unused MHSA funding that forgives past unused funding and gives small counties up to five years to use MHSA funds. CSAC supported SB 97, which was signed by the Governor on July 10.

Medi-Cal Managed Care Plans

SB 171 (Hernandez) and AB 205 (Wood) implement critical provisions of the federal Medicaid Managed Care rule related to supplemental Medi-Cal funding for California’s public health systems. CSAC supported both SB 171 and AB 205.

In spring 2016, the federal Centers for Medicare and Medicaid Services (CMS) released a final regulation of Medicaid managed care. The regulation included provisions directly related to public health care systems’ supplemental payments and placed new restrictions on how these supplemental payments must be directed from the state to Medicaid managed care plans and to providers.

SB 171 outlines important provisions related to public hospitals, mental health parity, and the Medical Loss Ratio (MLR). It is critical for California to implement the new federal regulations in a way that meets both the needs of all residents and the local county partners who provide the services on the ground, and SB 171 will assure continued federal funding for county public hospitals and health systems.

AB 205 outlines important provisions on the time, distance and access to care, the quality of care, managed care grievance provisions, and provisions related to fair hearings. The measure includes language requiring county specialty mental health plans to conform to state Knox-Keene timeliness and access requirements, which could potentially increase state costs. Overall, however, CSAC supported the implementation of the Medicaid managed care regulations through both bills which were passed by the Legislature on the final day of session and approved by the Governor on October 13.