LAO Releases Budget Analysis of HHS Issues

The Legislative Analyst’s Office (LAO) released it analyses of the health and human services budget proposals on Thursday. Links to the reports may be found here: health budget andhuman services budget.

The health budget analysis focuses primarily on the Patient Protection and Affordable Care Act (ACA) implementation in California. The LAO examines the Administration’s budget assumptions with enrollment costs and county savings from reduced indigent care. Generally, the Analyst finds the Administration’s estimates reasonable but acknowledges there is considerable uncertainty. The LAO describes the $900 million 2014-15 estimate of county savings as a “placeholder” number with more detailed and reliable data becoming available later this year. The LAO also points out that the Administration omits some potential ACA fiscal effects, including savings related to claiming enhanced federal fund and caseload declines for some state health programs. The LAO provides a chart of a dozen state health programs potentially impacted by the ACA.

The LAO also devotes significant analysis to Medi-Cal payments. They provide some recommendations on monitoring fee-for-service access but also suggest greater legislative oversight of managed care now that the bulk of Medi-Cal recipients are receiving services through managed care plans.

On the human services side, the LAO analysis examines In-Home Supportive Services (IHSS), CalWORKs and Community Care Licensing in-depth. The LAO provides lengthy analysis of the issues surrounding IHSS and the new federal overtime rules. The report raises a number of policy issues associated with the Administration’s proposal to restrict overtime including an erosion of consumer choice, uncertainty whether providers will meet the needs of consumers regularly needing more than 40 hours of care per week, uncertainty whether the “right” backup provider will be available for unforeseen circumstances and a lack of flexibility. Generally, the LAO found the Administration’s proposal to make fiscal sense. The LAO provides a menu of potential modifications to address the policy concerns raised in the report.

The LAO provides an overview and detail about the CalWORKs program, with a section detailing the changes in 2011 and 1991 realignments that impact CalWORKs funding (starts on page 41). The LAO also reviews the Administration’s proposed parent/child engagement demonstration pilot. The LAO recommends rejecting the pilot for a number of reasons: 1) it’s duplicative; 2) a pilot is unnecessary to demonstrate the impact of child care programs on child outcomes; and 3) the added value is not sufficiently compelling. Rather the LAO recommends the Legislature explore ways to address inconsistencies in child care standards.

Legislation

SB 1089 (Mitchell) – Request for Comment 
As Introduced on February 19, 2014

SB 1089, as amended by Senator Holly Mitchell, is sponsored by Los Angeles County and intended as a technical clean-up measure for AB 396 (Chapter 394, Statutes of 2011). AB 396 created a voluntary program that allows counties to draw down federal matching funds for the medical treatment of minors who are held in a juvenile justice facility and then hospitalized. SB 1089 seeks to clarify the county’s share of the costs and encourage the development of a claiming process.

However, a January 9, 2014 notification letter from the Department of Health Care Services Medi-Cal Supplemental Payments Section indicates that the Department has crafted a claiming process with very little county input. Further, the Department’s premature release of a claiming process has implications for the adult justice system and counties’ ability to draw down federal funding for inpatient hospital stays as well.

CSAC is asking counties to examine SB 1089 and communicate any questions or concerns so that we may better work to resolve these issues for both the adult and juvenile systems. Please contact Kelly Brooks-Lindsey at kbrooks@counties.org with comments. Thank you.

SB 1054 (Steinberg) – Support 
As Introduced on February 18, 2014

SB 1054, by Senate President Pro Tempore Darrell Steinberg, would resurrect the Mentally Ill Offender Crime Reduction (MIOCR) grant program by providing $25 million for juvenile offenders and $25 million for adult offenders in 2014-15.

The competitive grant program would be administered by the Board of State and Community Corrections and disbursements would be made to counties that expand or establish a continuum of swift, certain, and graduated responses to reduce crime and criminal justice costs related to mentally ill offenders over four years.

CSAC strongly supports Senator Steinberg’s efforts to target funding for intensive services to those who suffer from mental illness in the criminal justice system. SB 1054 has not yet been set for hearing.