Bill Text: CA AB577 | 2009-2010 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Program of All-Inclusive Care for the Elderly.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2009-10-11 - Chaptered by Secretary of State - Chapter 456, Statutes of 2009. [AB577 Detail]

Download: California-2009-AB577-Amended.html

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BILL NUMBER: AB 577	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JUNE 11, 2009
	AMENDED IN SENATE  MAY 26, 2009
	AMENDED IN ASSEMBLY  APRIL 13, 2009

INTRODUCED BY   Assembly Member Bonnie Lowenthal

                        FEBRUARY 25, 2009

   An act to amend Sections 1580.1 and 100315 of the Health and
Safety Code, and to amend Sections 14590, 14591, and 14598 of the
Welfare and Institutions Code, relating to the elderly.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 577, as amended, Bonnie Lowenthal. Program  for
  of  All-Inclusive Care for the Elderly.
   Existing law establishes the federal Medicaid program,
administered by each state, California's version of which is the
Medi-Cal program. The Medi-Cal program, which is administered by the
State Department of Health Care Services under the direction of the
Director of Health Care Services, provides qualified low-income
persons with health care services.
   Existing federal law establishes the  Programs 
 Program  of All-Inclusive Care for the Elderly (PACE),
which provides specified services for older individuals so that they
may continue living in the community. Federal law permits states to
implement the PACE program as a Medicaid state option.
   Existing state law authorizes the director to establish the
California Program of All-Inclusive Care for the Elderly  ,
and to contract with up to 10 demonstration projects to develop
risk-based long-term care pilot programs,  and establishes
PACE program services as a covered benefit of the Medi-Cal program.

   This bill would, instead, permit the director to contract with up
to 20 demonstration projects. 
   Existing law authorizes the State Department of Health Care
Services, and as applicable, the California Department of Aging and
the State Department of Social Services, to grant exemptions to
entities contracting with the department under the PACE program from
certain provisions relating to clinics, community care facilities,
residential care facilities for the elderly, home health agencies,
and adult day health centers.
   This bill would add the State Department of Public Health to the
list of departments that may grant exemptions, as applicable.
   This bill would authorize the State Department of Health Care
Services, after consulting with specified departments, as
appropriate, to apply approved exemption requests to all locations of
a PACE organization or to all PACE organizations on a statewide
basis.
   This bill specifies that certain federal requirements of the PACE
model not be waived or modified, including, among others, the
interdisciplinary team approach to care management and service
delivery and the provision of a PACE benefit package for all
participants, regardless of source of payment, that includes all
Medicare-covered items and services, all Medicaid-covered items and
services, as specified in the state's Medicaid plan, and other
services determined necessary by the interdisciplinary team to
improve and maintain the participant's overall health status.
   This bill would also make technical, nonsubstantive changes to the
above provisions.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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

  SECTION 1.  Section 1580.1 of the Health and Safety Code is amended
to read:
   1580.1.  The State Department of Health Care Services, and as
applicable, the California Department of Aging, may grant to entities
contracting with the State Department of Health Care Services under
the PACE program, as defined in Chapter 8.75 (commencing with Section
14590) of Part 3 of Division 9 of the Welfare and Institutions Code,
exemptions from the provisions contained in this chapter in
accordance with the requirements of Section 100315.
  SEC. 2.  Section 100315 of the Health and Safety Code is amended to
read:
   100315.  (a) The department and as applicable, the California
Department of Aging, the State Department of Public Health, and the
State Department of Social Services, may grant to a PACE program, as
defined in Chapter 8.75 (commencing with Section 14590) of Part 3 of
Division 9 of the Welfare and Institutions Code, exemptions from
duplicative, conflicting, or inconsistent requirements  , or
from the provisions contained  in Chapter 1 (commencing with
Section 1200), Chapter 3 (commencing with Section 1500), Chapter 3.2
(commencing with Section 1569), Chapter 3.3 (commencing with Section
1570), and Chapter 8 (commencing with Section 1725) of Division 2,
and Divisions 3 and 5 of Title 22 of the California Code of
Regulations, including the use of alternate concepts, methods,
procedures, techniques, space, equipment, personnel, personnel
qualifications, or the conducting of pilot projects, provided that
the exemptions are implemented in a manner that does not jeopardize
the health and welfare of participants receiving services under PACE,
or deprive beneficiaries of rights specified in federal or state
laws or regulations. In determining whether to grant exemptions under
this section, the departments shall consult with each other.
   (b) The department, after consultation with the California
Department of Aging, the State Department of Public Health, and the
State Department of Social Services, as appropriate, may apply
approved exemption requests to all locations of a PACE organization
or to all PACE organizations on a statewide basis.
   (c) A written request and substantiating evidence supporting the
request for an exemption under subdivision (a) shall be submitted by
the PACE program to the department. A PACE program may submit a
single request for an exemption from the licensing requirements
applicable to two or more licenses held by that organization, so long
as the request lists the locations and license numbers held by that
organization and the requested exemption is the same and appropriate
for all licensed locations. The written request shall include, but
shall not be limited to, all of the following:
   (1) A description of how the applicable state requirement
duplicates, conflicts with, or is inconsistent with state or federal
requirements related to the PACE model.
   (2) An analysis demonstrating why the duplication, conflict, or
inconsistency cannot be resolved without an exemption.
   (3) A description of how the PACE program plans to comply with the
intent of the requirements described in paragraph (1).
   (4) A description of how the PACE program will monitor its
compliance with the terms and conditions under which the exemption is
granted.
   (d) The department shall approve or deny any request within 60
days of submission. An approval shall be in writing and shall provide
for the terms and conditions under which the exemption is granted. A
denial shall be in writing and shall specify the basis therefor. Any
decision to deny a request shall be a final administrative decision.

   (e) If, after investigation, the department determines that a PACE
program that has been granted an exemption under this section is
operating in a manner contrary to the terms and conditions of the
exemption, the department shall immediately suspend or revoke the
exemption. If the exemption is applicable to more than one location
or more than one category of licensure, or both, the department may
suspend or revoke an exemption as to one or more license categories
or locations as deemed appropriate by the department.
  SEC. 3.  Section 14590 of the Welfare and Institutions Code is
amended to read:
   14590.  The Legislature finds and declares that: 
   (1) 
    (a)  Community-based services to the frail elderly are
often uncoordinated, fragmented, inappropriate, or insufficient to
meet the needs of frail elderly who are at risk of
institutionalization, often resulting in unnecessary placement in
nursing homes. 
   (2) 
    (b)  Steadily increasing health care costs for the frail
elderly provide incentive to develop programs providing quality
services at reasonable costs. 
   (3) 
    (c)  Capitated "risk-based" financing provides an
alternative to the traditional fee-for-service payment system by
providing a fixed, per capita monthly payment for a package of health
care services and requiring the provider to assume financial
responsibility for cost overruns. 
   (4) 
    (d)  On Lok Senior Health Services began as a federal
and state demonstration program in 1973 to test whether comprehensive
community-based services could be provided to the frail elderly at
no greater cost than nursing home care. 
   (5) 
    (e)  Since 1983, On Lok Senior Health Services of San
Francisco has successfully provided a comprehensive package of
services and operated within a cost-effective, capitated risk-based
financing system. 
   (6) 
    (f)  Recognizing On Lok's success, Congress passed
Legislation in 1986 and 1987 encouraging the expansion of capitated
long-term care programs by permitting federal Medicare and Medicaid
waivers to be granted indefinitely to On Lok and authorizing the
federal Centers for Medicare and Medicaid Services to grant waivers
in up to 10 new sites throughout the nation in order to replicate the
On Lok model. 
   (7) 
    (g)  In California, numerous agencies have expressed
interest in developing programs similar to On Lok and will need the
cooperation of the State Department of Health Care Services to
successfully obtain the necessary available federal waivers to
develop risk-based capitated long-term care demonstration programs.

   (8) 
    (h)  Through the development of these demonstration
programs, the viability of a cost-effective statewide program
offering quality long-term care services can be evaluated. 
   (9) 
    (i)  To achieve maximum cost effectiveness in
demonstration projects under this chapter, an expedited contract
process is necessary.
  SEC. 4.  Section 14591 of the Welfare and Institutions Code is
amended to read:
   14591.  The State Director of Health Care Services may establish
the California Program of All-Inclusive Care for the Elderly, to
promote the development of community-based, risk-based capitated,
long-term care programs.
  SEC. 5.  Section 14598 of the Welfare and Institutions Code is
amended to read:
   14598.  (a) The Legislature finds and declares both of the
following:
   (1) The demonstration projects authorized by this article have
proven to be successful at providing comprehensive, community-based
services to frail elderly individuals at no greater cost than for
providing nursing home care.
   (2) Based upon that success, California now desires to provide
community-based, risk-based, and capitated long-term care services
under the Programs of All-Inclusive Care for the Elderly (PACE) as
optional services under California's medicaid state plan and under
contracts, entered into between the federal Centers for Medicare and
Medicaid Services, the department, as the single state medicaid
agency, and PACE organizations, meeting the requirements of the
Balanced Budget Act of 1997 (Public Law 105-33) and Part 460
(commencing with Section 460.2) of Subchapter E of Title 42 of the
Code of Federal Regulations.
   (b) The department may enter into the contracts specified in
subdivision (a) for implementation of the PACE program, and also may
enter into separate contracts with the PACE organizations contracting
under subdivision (a), to fully implement the single state agency
responsibilities assumed by the department in those contracts, the
provisions of Section 14132.94, and any other state requirement found
necessary by the department to provide comprehensive
community-based, risk-based, and capitated long-term care services to
California's frail elderly. The department may enter into separate
contracts specified in subdivision (a) with up to  20
  10  PACE organizations. The department may not
enter into any contracts specified in subdivision (a) unless a
medicaid state plan amendment, electing PACE as a state medicaid
option as provided for in Section 14132.94, has been approved by the
federal Centers for Medicare and Medicaid Services.
   (c) Notwithstanding subdivisions (a) and (b), any demonstration
project contract entered into under this article prior to January 1,
2004, shall remain in full force and effect under its own terms, but
shall not be renewed or amended beyond the termination date in effect
on that date.
   (d) The requirements of the PACE model, as provided for pursuant
to Section 1894 (42 U.S.C. Sec. 1395eee) and Section 1934 (42 U.S.C.
Sec. 1396u-4) of the federal Social Security Act, shall not be waived
or modified. The requirements that shall not be waived or modified
include all of the following:
   (1) The focus on frail elderly qualifying individuals who require
the level of care provided in a nursing facility.
   (2) The delivery of comprehensive, integrated acute and long-term
care services.
   (3) The interdisciplinary team approach to care management and
service delivery.
   (4) Capitated, integrated financing that allows the provider to
pool payments received from public and private programs and
individuals.
   (5) The assumption by the provider of full financial risk.
   (6) The provision of a PACE benefit package for all participants,
regardless of source of payment, that shall include all of the
following:
   (A) All Medicare-covered items and services.
   (B) All Medicaid-covered items and services, as specified in the
state's Medicaid plan.
   (C) Other services determined necessary by the interdisciplinary
team to improve and maintain the participant's overall health status.

   (e) For purposes of this section, "PACE organizations" means those
entities as defined in 42 C.F.R. 460.6.