BILL NUMBER: SB 208	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  AUGUST 2, 2010
	AMENDED IN ASSEMBLY  JUNE 22, 2010

INTRODUCED BY   Senators Steinberg and Alquist
   (Principal coauthor: Assembly Member John A. Perez)

                        FEBRUARY 23, 2009

   An act to amend Section 15908 of,  to amend and renumber and
add Section 14182 of,  to add Sections 14132.275, 
14183, 14183.1, 14183.5, 14184  14182.1, 14182.15, and
14182.2  to, and to add Part 3.6 (commencing with Section 15909)
to Division 9 of, the Welfare and Institutions Code, relating to
Medi-Cal, and declaring the urgency thereof, to take effect
immediately.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 208, as amended, Steinberg. Medi-Cal: demonstration project
waivers.
   Existing law provides for the Medi-Cal program, which is
administered by the State Department of Health Care Services and
under which qualified low-income persons receive health care
benefits. The Medi-Cal program is, in part, governed and funded by
federal Medicaid provisions.
   Existing federal law provides for the federal Medicare Program,
which is a public health insurance program for persons 65 years of
age and older and specified persons with disabilities who are under
65 years of age.
   This bill would, to the extent that federal financial
participation is available, and pursuant to a demonstration project
or waiver of federal law, require the department to establish pilot
projects in up to 4 counties, as specified, to develop effective
health care models to provide services to persons who are dually
eligible under both the Medi-Cal and Medicare programs. This bill
would require the department to, no later than  January 1,
2012,   April 1, 2011,  identify health care models
that may be included in a pilot project  and  
,  to develop a timeline and process for selecting, financing,
monitoring, and evaluating the pilot projects  , and to provide
this timeline and process to certain committees of the Legislature
 .
   Existing law requires the department to seek a demonstration
project or federal waiver of Medicaid law to implement specified
objectives, which may include better care coordination for seniors
and persons with disabilities and children with special health care
needs.
   This bill would, in furtherance of the  waiver or 
demonstration project and to the extent that federal financial
participation is available, permit the department to  develop
a pilot project that would  require seniors and persons
with disabilities  who do not have other health coverage  to
be assigned as mandatory enrollees into new and existing managed
care health plans or county alternative models of care, as specified.
This bill would provide that enrollment of seniors and persons with
disabilities shall be accomplished using a phased-in process and
shall not commence until necessary federal approvals have been
acquired, or until February 1, 2011, whichever is later. The bill
would impose various requirements upon managed care health plans and
county alternative models of care participating in the demonstration
program.
   This bill would,  commencing January 1, 2011, require all
Medi-Cal managed care health plans and other managed care
arrangements, as specified, to submit data, including encounter data
and financial data, for the development of rates, monitoring
performance, and ensuring quality.   beginning January
1, 2012, require managed care health plans and county alternative
models of care to comply with quality submission standards developed
by the department as prescribed. 
   This bill would require the department, in conjunction with the
implementation of the pilot project, to work with counties to develop
a method to be used in determining the appropriate contribution to
cover the nonfederal share of inpatient hospital expenses for seniors
and persons with disabilities in the Medi-Cal program.
   Existing law, the Robert W. Crown California Children's Services
Act, requires the department and each county to administer the
California Children Services (CCS) program for treatment services for
persons under 21 years of age diagnosed with severe chronic disease
or severe physical limitations, as specified.
   This bill also would, in furtherance of the  waiver or 
demonstration project, require the Director of Health Care Services
to establish, by January 1, 2012, models of organized health care
delivery systems, as specified, for children eligible for services
under the CCS program. This bill would provide that, to the extent
permitted by federal law, the department may require eligible
individuals to enroll in these models. This bill would also permit
the Managed Risk Medical Insurance Board to elect, with the consent
of the director, to permit children enrolled in the Healthy Families
Program who are eligible for CCS services to enroll in these
organized health care delivery models.
   Existing law provides for the Health Care Coverage Initiative,
which is a federal waiver demonstration project established to expand
health care coverage to low-income uninsured individuals who are not
currently eligible for the Medi-Cal program, the Healthy Families
Program, or the Access for Infants and Mothers program.
   Existing law provides for the repeal of  this 
 the department's  authority  under the Health Care
Coverage Initiative  upon the execution of a declaration by the
Director of Health Care Services specifying that the demonstration
project has been terminated.
   This bill would, alternatively, authorize the director to execute
a declaration continuing the demonstration project to the extent
authorized by a successor federal waiver or demonstration project.
   This bill would, in this regard,  only  to the extent
that federal financial participation is available  and only to
the extent that federal financial participation is not jeopardized
 , require the department to, on or after September 1, 2010, but
no later than January 1, 2011, or 180 days after federal approval
 is obtained, seek   of  a successor
demonstration project or federal waiver of Medicaid law to 
establish  authorize local  Coverage Expansion and
Enrollment Demonstration (CEED) projects, as specified, to provide
scheduled health care benefits for uninsured adults 19 to 64,
inclusive, years of age with incomes up to 200% of the federal
poverty level who are not otherwise eligible for Medi-Cal or
Medicare. This bill would require CEED projects to be designed and
implemented with the systems and program elements necessary to
facilitate the transition of those eligible individuals to the
Medi-Cal program, or alternatively, to coverage through the state
health insurance exchange, by 2014, pursuant to the provisions of
federal and state law, and the terms and conditions of specified
successor federal waivers or demonstrations projects.
   This bill would declare that it is to take effect immediately as
an urgency statute.
   Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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

  SECTION 1.  Section 14132.275 is added to the Welfare and
Institutions Code, to read:
   14132.275.  (a) The department shall seek federal approval to
establish pilot projects described in this section pursuant to a
Medicare or a Medicaid demonstration project or waiver, or a
combination thereof. Under a Medicare demonstration, the department
may operate the Medicare component of a pilot project as a delegated
Medicare benefit administrator, and may enter into financing
arrangements with the federal Centers for Medicare and Medicaid
Services to share in any Medicare program savings generated by the
operation of any pilot project.
   (b) After federal approval is obtained, the department shall
establish pilot projects that enable dual eligibles to receive a
continuum of services, and that maximize the coordination of benefits
between the Medi-Cal and Medicare programs and access to the
continuum of services needed. The purpose of the pilot projects is to
develop effective health care models that integrate services
authorized under the federal Medicaid Program (Title XIX of the
federal Social Security Act (42 U.S.C. Sec. 1396 et seq.)) and the
federal Medicare Program (Title XVIII of the federal Social Security
Act (42 U.S.C. Sec. 1395 et seq.)). These pilot projects may also
include additional services as approved through a demonstration
project or waiver, or a combination thereof.
   (c) No later than  January 1, 2012   April 1,
2011  , the department shall identify health care models that
may be included in a pilot project,  and  shall
develop a timeline and process for selecting, financing, monitoring,
and evaluating these pilot  projects.  
projects, and shall provide this timeline and process to the
appropriate fiscal and policy committees of the Legislature. The
department may implement these pilot projects in phases. 
   (d) Goals for the pilot projects shall include all of the
following:
   (1) Coordinating Medi-Cal  and Medicare benefits 
 benefits, Medicare benefits, or both,  across health care
settings and improving continuity of acute care, long-term care, and
home- and community-based services.
   (2) Coordinating access to acute and long-term care services for
dual eligibles.
   (3) Maximizing the ability of dual eligibles to remain in their
homes and communities with appropriate services and supports in lieu
of institutional care.
   (4) Increasing the availability of and access to home- and
community-based alternatives.
   (e) Pilot projects shall be established in up to four counties,
and shall include at least one county that provides Medi-Cal services
via a two plan model pursuant to Article 2.7 (commencing with
Section 14087.3) and  at least  one county that provides
Medi-Cal services under a county organized health system pursuant to
Article 2.8 (commencing with Section 14087.5). In determining the
counties in which to establish a pilot project, the director shall
consider the following:
   (1) Local support for integrating medical care, long-term care,
and home- and community-based services networks.
   (2) A local stakeholder process that includes health plans,
providers, community programs, consumers, and other interested
stakeholders in the development, implementation, and continued
operation of the pilot project.
   (f) The director may enter into exclusive or nonexclusive
contracts on a bid or negotiated basis and may amend existing managed
care contracts to provide or arrange for services provided under
this section. Contracts entered into or amended pursuant to this
section shall be exempt from the provisions of Chapter 2 (commencing
with Section 10290) of Part 2 of Division 2 of the Public Contract
Code and Chapter 6 (commencing with Section 14825) of Part 5.5 of
Division 3 of the Government Code.
   (g) Notwithstanding any other provision of state law, the
department may require that dual eligibles be assigned as mandatory
enrollees into managed care plans established or expanded as part of
a pilot project. To the extent that mandatory enrollment is required,
except for subdivision (f) of Section  14183  
14182  , any requirement of the department and the health plans,
and any requirement of continuity of care protections for enrollees,
as specified in Section  14183   14182  ,
shall be applicable to this section. Dual eligibles shall have the
option to forgo receiving Medicare benefits under a pilot project.
 Nothing in this secti   on shall be interpreted to
reduce benefits otherwise available under the Medi-Cal program or the
Medicare Program. 
   (h) For purposes of this section, a "dual eligible" means an
individual who is simultaneously eligible for full scope benefits
under Medi-Cal and the federal Medicare program.
   (i) Persons meeting requirements for Program of All-Inclusive Care
for the Elderly (PACE) pursuant to Chapter 8.75 (commencing with
Section 14590), may select a PACE plan if one is available in that
county.
   (j)  The   Notwithstanding   Section
10231.5 of the Government Code, the  department shall conduct
an evaluation to assess outcomes and the experience of dual eligibles
in these pilot projects and shall provide a report to the
Legislature after the first full year of pilot operation, and
annually thereafter.  A report submitted to the Legislature
pursuant to this subdivision shall be submitted in compliance with
Section 9795 of the Government Code. The department shall convene a
stakeholder technical workgroup to advise on the scope and structure
of the evaluation. 
   (k) This section shall be implemented only if and to the extent
that federal financial participation or funding is available to
establish these pilot projects.
   (l) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, the
department may implement, interpret, or make specific this section
and any applicable federal waivers and state plan amendments by means
of all-county letters, plan letters, plan or provider bulletins, or
similar instructions, without taking regulatory action.
   SEC. 2.    Section 14182 of the   Welfare
and Institutions Code   is amended and renumbered to read:

    14182.   14182.9.   Notwithstanding the
Administrative Procedure Act, Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code, the
department may implement the provisions of this article through
all-county welfare director letters or similar instruction, without
taking regulatory action. Prior to issuing any letter or similar
instrument authorized pursuant to this section, the department shall
notify and consult with stakeholders, including advocates, providers,
and beneficiaries, in implementing, interpreting, or making specific
this article.
   SEC. 2.   SEC. 3.   Section 
14183   14182  is added to the Welfare and
Institutions Code, to read:
    14183.   14182.   (a)  In
furtherance of the   (1)     In
furtherance of the waiver or    demonstration project
developed pursuant to Section 14180, the department may require
seniors and persons with disabilities  who do not have other
health coverage  to be assigned as mandatory enrollees into new
or existing managed care health plans, or county alternative models
of care as described in subdivision (f). To the extent that
enrollment is required by the department, an enrollee's access to
fee-for-service Medi-Cal shall not be terminated until the enrollee
has been assigned to a managed care  provider  
health plan  or county alternative model of care. 
   (2) For purposes of this section:  
   (A) "Other health coverage" means health coverage providing the
same full or partial benefits as the Medi-Cal program, health
coverage under another state or federal medical care program, or
health coverage under contractual or legal entitlement, including,
but not limited to, a private group or indemnification insurance
program.  
   (B) "Managed care health plan" means an individual, organization,
or entity that enters into a contract with the department pursuant to
Article 2.7 (commencing with Section 14087.3), Article 2.81
(commencing with Section 14087.96), Article 2.91 (commencing with
Section 14089), or Chapter 8 (commencing with Section 14200). 
   (b) In exercising its authority pursuant to subdivision (a), the
department shall do all of the following:
   (1) Assess and ensure the readiness of the managed care health
plans or county alternative models of care to address the unique
needs of seniors or persons with disabilities pursuant to the
applicable readiness evaluation criteria and requirements set
 for   forth  in paragraphs (1) to (8),
inclusive, of subdivision (b) of Section 14087.48.
   (2) Ensure the managed care health plans or county alternative
models of care  provide access to providers that comply with
applicable state and federal laws, including, but not limited to,
physical accessibility and the provision of health plan information
in alternative formats.
   (3) Develop and implement an outreach and education program for
seniors and persons with disabilities, not currently enrolled in
Medi-Cal managed care, to inform them of their enrollment options and
rights under the demonstration project. Contingent upon available
private or public dollars other than moneys from the General Fund,
the department or its designated agent for enrollment and outreach
may partner or contract with community-based, nonprofit consumer or
health insurance assistance organizations with expertise and
experience in assisting seniors and persons with disabilities in
understanding their health care coverage options. Contracts entered
into or amended pursuant to this paragraph shall be exempt from
Chapter 2 (commencing with Section 10290) of Part 2 of Division 2 of
the Public Contract Code and any implementing regulations or policy
directives.
   (4) At least three months prior to enrollment, inform
beneficiaries who are seniors or persons with disabilities, through a
notice written at no more than a sixth grade reading level, about
the forthcoming changes to their delivery of care, including, at a
minimum, how their system of care will change, when the changes will
occur, and who they can contact for assistance with choosing a
delivery system or with problems they encounter. In developing this
notice, the department shall consult with consumer representatives
and other stakeholders.
   (5) Implement an appropriate  cultural  awareness and
sensitivity training program regarding serving seniors and persons
with disabilities for managed care health plans and county
alternative models of care, and plan providers and staff in the
Medi-Cal Managed Care Division of the department. 
   (6) Establish a process for assigning enrollees into an organized
delivery system for beneficiaries who do not make an affirmative
selection of a managed care plan or county alternative model of care.
The department shall develop this process in consultation with
stakeholders and in a manner consistent with the waiver or
demonstration project developed pursuant to Section 14180. The
department shall base plan assignment on an enrollee's existing or
recent utilization of providers, to the extent possible. If the
department is unable to make an assignment based on the enrollee's
affirmative selection or utilization history, the department shall
base plan assignment on factors, including, but not limited to, plan
quality and the inclusion of local health care safety net system
providers in the plan's provider network.  
   (6) 
    (7)  Coordinate with the managed care health plans and
county alternative models of care, in consultation with stakeholders
and consumers, to develop and implement a mechanism or algorithm to
identify, within the earliest possible timeframe, persons with
 the highest risk and most   higher risk and
more  complex health care needs. 
   (7) 
    (8)  Provide managed care health plans and county
alternative models of care with historical utilization data for
beneficiaries upon enrollment in a managed care health plan or county
alternative model of care so that the plans participating in the
demonstration project are better able to assist beneficiaries and
prioritize assessment and care planning. 
   (8) 
    (9)  Develop and provide managed care health plans and
county alternative models of care participating in the demonstration
project with  an enhanced   a  facility
site review tool for use in assessing the physical accessibility of
providers, including specialists and ancillary service 
providers,   providers that   provide care to a
high volume of seniors and persons with disabilities,  at a
clinic or provider site,  in order  to ensure that
there are sufficient physically accessible providers. 
   (9) 
    (10)  Develop a process to enforce legal sanctions,
including, but not limited to, financial penalties, withholding of
Medi-Cal payments, enrollment termination, and contract termination,
in order to sanction any managed care health plan or county
alternative models of care in the demonstration project that
consistently or repeatedly fails to meet performance standards.

   (10) 
    (11)  Ensure that managed care health plans and county
alternative models of care provide a mechanism for enrollees to
request a specialist or clinic as a primary care provider.  A
specialist or clinic may serve as a primary care provider if the
specialist or clinic agrees to serve in a primary care provider role
and is qualified to treat the required range of conditions of the
enrollee.  
   (11) 
    (12)  Ensure that managed care health plans and county
alternative models of care participating in the demonstration project
are able to provide communication access to seniors and persons with
disabilities in alternative formats or through other methods that
ensure communication, including assistive listening systems, sign
language interpreters, captioning, pad and pencil, plain language or
written translations and oral interpreters, including for those who
are limited English-proficient, or non-English speaking, and that all
managed care health plans and county alternative models are in
compliance with applicable cultural and linguistic requirements.

   (12) 
    (13)  Ensure that managed care health plans and county
alternative models participating in the demonstration project provide
access to out-of-network providers for new individual members
enrolled under this section who have an ongoing relationship with a
provider if the provider will accept the health plan or the county
alternative model of care's rate for the service offered, or the
applicable Medi-Cal fee-for-service rate, whichever is higher, and
the health plan or county alternative model of care determines that
the provider meets applicable professional standards and has no
disqualifying quality of care issues. 
   (13) 
    (14)  Ensure that managed care health plans and county
alternative models of care participating in the demonstration project
comply with continuity of care requirements in Section 1373.96 of
the Health and Safety Code. 
   (14) 
    (15)  Ensure that the medical exemption criteria applied
in counties operating under Chapter 4.1 (commencing with Section
53800) or Chapter 4.5 (commencing with Section 53900) of Subdivision
1 of Division 3 of Title 22 of the California Code of Regulations are
applied to seniors and persons with disabilities served under this
section. 
   (16) Ensure that managed care health plans and county alternative
models of care participating in the demonstration project take into
account the behavioral health needs of enrollees and include
behavioral health services as part of the enrollee's care management
plan when appropriate.  
   (17) Develop performance measures that provide quality indicators
for the Medi-Cal population enrolled in a managed care health plan or
county alternative model of care and for the subset of enrollees who
are seniors and persons with disabilities. These performance
measures may include Healthcare Effectiveness Data and Information
Set (HEDIS) measures.  
   (18) Conduct medical audit reviews of participating managed care
health plans and county alternative models of care that include
elements specifically related to the care of seniors and persons with
disabilities. These medical audits shall include evaluation of the
delivery model's policies and procedures.  
   (19) Conduct financial audit reviews to ensure that a financial
statement audit is performed on managed care health plans and county
alternative models of care annually pursuant to the Generally
Accepted Auditing Standards, and conduct other risk-based audits for
the purpose of detecting fraud and irregular transactions. 
   (c) Prior to exercising its authority under this section and
Section 14180, the department shall ensure that each managed care
health plan or county alternative model of care participating in the
demonstration project is able to do all of the following:
   (1) Comply with the applicable readiness evaluation criteria and
requirements set forth in paragraphs (1) to (8), inclusive of
subdivision (b) of Section 14087.48. The assessment of network
adequacy shall be determined in collaboration with the Department of
Managed Health Care.
   (2) Ensure and monitor an appropriate provider network, including
primary care physicians, specialists, professional, allied, and
medical supportive personnel, and an adequate number of accessible
facilities within each service area. Health plans and county
alternative models shall maintain an updated, accurate, and
accessible listing of a provider's ability to accept new patients and
made available to enrollees, at a minimum, by phone, written
material, or Internet Web site.
   (3) Assess the health care needs of beneficiaries who are seniors
or persons with disabilities and coordinate their care across all
settings, including coordination of necessary services within and,
where necessary, outside of the plan's provider network.
   (4) Ensure that the provider network and informational materials
meet the linguistic and other special needs of seniors and persons
with disabilities, including providing information in an
understandable manner in plain language, maintaining toll-free
telephone lines, and offering member or ombudsperson services.
   (5) Provide clear, timely, and fair processes for accepting and
acting upon complaints, grievances, and disenrollment requests,
including procedures for appealing decisions regarding coverage or
benefits. Each plan participating in the demonstration project shall
have a grievance process that complies with Sections 1368 and 1368.01
of the Health and Safety Code.
   (6) Solicit stakeholder and member participation in advisory
groups for the planning and development activities related to the
provision of services for seniors and persons with disabilities.
   (7) Contract with safety net and traditional providers as defined
in subdivisions (hh) and (jj) of Section 53810, of Title 22 of the
California Code of Regulations, to ensure access to care and
services. The managed care health plan or county alternative model of
care shall establish participation standards to ensure participation
and broad representation of traditional and safety net providers
within a service area.
   (8) Inform seniors and persons with disabilities of procedures for
obtaining transportation services to service sites that are offered
by the plan or are available through the Medi-Cal program.
   (9) Monitor the quality and appropriateness of care for children
with special health care needs, including children eligible for, or
enrolled in, the California Children Services Program, and seniors
and persons with disabilities.
   (10) Maintain a dedicated liaison to coordinate with each regional
center operating within the plan's service area to assist members
with developmental disabilities in understanding and accessing
services and act as a central point of contact for questions, access
and care concerns, and problem resolution. 
   (11) Stratify incoming beneficiaries with aide codes applicable to
seniors and persons with disabilities of high or low risk by
applying a risk stratification algorithm approved by the department
to member specific fee-for-service claims data provided to the
managed care health plan or county alternative model of care at the
time of enrollment of the beneficiary.  
   (12) (A) Administer a risk assessment survey tool approved by the
department to determine risk level of enrollees, which shall be
utilized by managed care health plans and county alternative models
of care participating under the demonstration project. Managed care
health plans and county alternative models of care shall perform a
telephonic assessment of newly enrolled beneficiaries based on their
risk as determined by the risk stratification algorithm specified in
paragraph (11) within the  
   (11) Offer a contract or subcontract to an entity licensed as a
primary care clinic pursuant to subdivision (a) of Section 1204 of
the Health and Safety Code. The department shall ensure that managed
care contracts and subcontracts with primary care clinics are on the
same terms and conditions, including, but not limited to,
compensation rates, as those contracts and subcontracts offered to
other entities providing a similar scope of services in furtherance
of the demonstration project.  
   (12) At the time of enrollment apply the risk stratification
mechanism or algorithm described in paragraph (7) of subdivision (b)
approved by the department to determine the health risk level of
beneficiaries. 
    (13)     (A)     Managed
health care plans and county alternative models of care shall assess
an enrollee's current health risk by administering a risk assessment
survey tool approved by the department. This risk assessment survey
shall be performed within the  following timeframes:
   (i) Within 45 days of plan enrollment for  higher risk
beneficiaries   individuals determined to be at higher
risk pursuant to paragraph (12)  .
   (ii) Within 105 days of plan enrollment for  lower risk
beneficiaries   individuals determined to be at lower
risk pursuant to paragraph (12)  .
   (B) Based on the results of the  telephonic  
current  health risk assessment, managed care health plans and
county alternative models of care shall develop individual care plans
for higher risk beneficiaries that shall include the following
minimum components:
   (i) Redetermination of risk level if indicated.
   (ii) Identification of medical care needs, including primary care,
specialty care, durable medical equipment, medications, and other
needs with a plan for care coordination as needed.
   (iii) Identification of needs and referral to appropriate
community resources and other agencies as needed for services outside
the scope of responsibility of the managed care health plan or
county alternative model of care.
   (iv) Appropriate involvement of caregivers.
   (v) Determination of timeframes for recontact or reassessment.

   (13) 
    (14)  Establish medical homes to which enrollees are
assigned that include at a minimum all of the following elements:
   (A) The primary care physician who is the primary clinician for
the beneficiary and who provides core clinical management functions.
   (B) Care management and care coordination for the beneficiary
across the health care system including transitions among levels of
care.
   (C) Identification of the beneficiary's needs and referral to
community resources and other agencies for services or items outside
the scope of responsibility of the managed care health plan or county
alternative model of care.
   (D) Use of clinical data to identify beneficiaries at the care
site with chronic illness or other significant health issues.
   (E) Ensuring appropriate timeframes at the site and alternatives
for the beneficiary's access to care for preventive, acute or chronic
illness treatment as needed.
   (F) Use of clinical guidelines or other evidence-based medicine
when applicable for treatment of beneficiaries' health care issues or
timing of clinical preventive services. 
   (14) 
    (15)  Perform, at a minimum, the following care
management and care coordination functions and activities for
enrollees who are seniors or persons with disabilities:
   (A) Assessment of  the new enrollees   each
new enrollee's  risk level and health needs  through a
standardized, telephonic health risk assessment to determine risk
level.   shall be conducted through a standardized risk
assessment survey by means such as telephonic, Web-based, or
in-person communication or by other means as determined by the
department. 
   (B) Facilitation of timely access to primary care, specialty care,
durable medical equipment, medications, and other health services
needed by the enrollee, including referrals for any physical or
cognitive barriers to access.
   (C) Active referral to community resources or other agencies for
needed services or items outside the managed care health plans and
county alternative models of care responsibilities.
   (D) Facilitating communication among the beneficiaries' health
care providers, including mental health and substance abuse providers
when appropriate.
   (E) Other activities or services needed to assist beneficiaries in
optimizing their health status, including assisting with self
management skills or techniques, health education, and other
modalities to improve health status.
   (d) Beneficiaries enrolled in managed care health plans or county
alternative models of care pursuant to this section shall have the
choice to continue an established patient-provider relationship in a
managed care health plan or county alternative model of care
participating in the demonstration project if his or her treating
                                            provider is a primary
care provider or clinic contracting with the managed care health plan
or county alternative model of care and agrees to continue to treat
that beneficiary.  If a managed care health plan or county
alternative model of care assigns beneficiaries to a federally
qualified health center, the provisions of subdivision (b) of Section
14087.325 shall apply. 
   (e) The department, or as applicable, the California Medical
Assistance Commission, may contract with existing managed care health
plans operating under the demonstration project to provide or
arrange for services under this section. Notwithstanding any other
provision of law, the department, or as applicable, the commission,
may enter into the contract without the need for a competitive bid
process or other contract proposal process, provided the managed care
health plan provides written documentation that it meets all
qualifications and requirements of this section. Alternatively, and
notwithstanding any provision of law to the contrary, the department,
or as applicable, the commission, may seek applications and
thereafter contract with any qualified individual, entity, or
organization to provide or arrange for services under this section.
   (f) (1) Except for counties operating under the county organized
health systems model, and notwithstanding any requirements specified
in Article 2.7 (commencing with Section 14087.3) and Article 2.91
(commencing with Section 14089), a county shall have the option,
subject to approval by the department, to develop an alternative
model of care consistent with the terms of the demonstration project
to provide health care services within the scope of the county's
contract with the department to beneficiaries categorized as seniors
or persons with disabilities under the demonstration project. The
county alternative model of care may be managed by county staff and
shall not be required to obtain licensure under the Knox-Keene Health
Care Service Plan Act of 1975 (Chapter 2.2 (commencing with Section
1340) of Division 2 of the Health and Safety Code), unless the model
is a capitated model that assumes full risk for its beneficiaries.
   (2) For purposes of this subdivision, county alternative models of
care may include, at the discretion of the department,
administrative services organizations, primary care case management
plan, outpatient managed care models, and other models the department
determines acceptable.
   (3) A county shall be required to select the county alternative
model of care option prior to commencement of mandatory enrollment of
seniors or persons with disabilities in a county pursuant to
subdivision (a), but no later than January 1, 2012.
   (4) The department shall determine an actuarially sound rate for
the county alternative models of care that is adequate and sufficient
to ensure access to services, and that is budget neutral to the
state. 
   (5) The department shall ensure that local county alternative
option programs shall offer a contract or subcontract to an entity
licensed as a primary care clinic pursuant to subdivision (a) of
Section 1204 of the Health and Safety Code. The department shall
ensure that contracts and subcontracts with primary care clinics are
on the same terms and conditions, including, but not limited to,
compensation rates, as those contracts and subcontracts offered to
other noncounty entities providing a similar scope of services in
furtherance of a county alternative option. 
   (g) This section shall be implemented only to the extent that
federal financial participation is available.
   (h) The development and negotiation of capitation rates for
managed care health plan contracts shall include the analysis of data
specific to the seniors and persons with disabilities population.
For the purposes of developing or negotiating capitation rates for
payments to managed care health plans, the director may require
managed care health plans, including existing managed health care
plans, to submit financial and utilization data in a form, time, and
substance as deemed necessary by the department.
   (i) Persons meeting participation requirements for the Program of
All-Inclusive Care for the Elderly (PACE) pursuant to Chapter 8.75
(commencing with Section 14590), may select a PACE plan if one is
available in that county. 
   (j) Persons meeting the participation requirements in effect on
January 1, 2010, for a Medi-Cal primary care case management (PCCM)
plan in operation on that date, may select that PCCM plan or a
successor health care plan that is licensed pursuant to the
Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2
(commencing with Section 1340) of Division 2 of the Health and Safety
Code) to provide services within the same geographic area that the
PCCM plan served on January 1, 2010.  
   (j) 
    (k)  Notwithstanding Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code, the department may implement, interpret, or make specific this
section and any applicable federal waivers and state plan amendments
by means of all-county letters, plan letters, plan or provider
bulletins, or similar instructions, without taking regulatory action.

   (k) 
    (l)  Consistent with state law that exempts Medi-Cal
managed care contracts from Chapter 2 (commencing with Section 10290)
of Part 2 of Division 2 of the Public Contract Code, and in order to
achieve maximum cost savings, the Legislature hereby determines that
an expedited contract process is necessary for managed care health
plan contracts entered into or amended pursuant to this section. The
contracts and amendments entered into or amended pursuant to this
section shall be exempt from Chapter 2 (commencing with Section
10290) of Part 2 of Division 2 of the Public Contract Code and the
requirements of State Administrative Management Manual Memo 03-10.
The department shall make the terms of a contract available to the
public within 30 days of the contract's effective date. 
   (l) 
    (m)  In the event of a conflict between the terms and
conditions of the approved demonstration project, including any
attachment thereto, and any provision of this part, the terms and
conditions shall control.  If the department identifies a
specific provision of this article that conflicts with a term or
condition of the approved waiver or demonstration project, or an
attachment thereto, the term or   condition shall control,
and the department shall so notify the appropriate fiscal and policy
committees of the Legislature within 15 business days.  

   (m) 
    (n)  In the event of a conflict between the provisions
of this article and any other provision of this part, the provisions
of this article shall control. 
   (n) 
    (o)  Any otherwise applicable provisions of this
chapter, Chapter 8 (commencing with Section 14200), or Chapter 8.75
(commencing with Section 14500) not in conflict with this article or
with the terms and conditions of the demonstration project shall
apply to this section. 
   (o) 
    (p)  To the extent that the director utilizes state plan
amendments or waivers to accomplish the purposes of this article in
addition to waivers granted under the demonstration project, the
terms of the state plan amendments or waivers shall control in the
event of a conflict with any provision of this part. 
   (p) 
    (q)  Enrollment of seniors and persons with disabilities
into a managed care health plan or county alternative model of care
under this section shall be accomplished using a phased-in process to
be determined by the department and shall not commence until
necessary federal approvals have been acquired or until February 1,
2011, whichever is later. 
   (q) 
    (r)  A managed care health plan or county alternative
model of care established pursuant to this section, or under the
terms and conditions of the demonstration project pursuant to Section
14180, shall be subject to, and comply with, the requirement for
submission of encounter data specified in Section  14183.1
  14182.1  . 
   (r) 
    (s)     (1)  Commencing January 1,
2011, and until January 1, 2014, the department shall provide the
fiscal and policy committees of the Legislature with semiannual
updates regarding core activities for the enrollment of seniors and
persons with disabilities into managed care health plans or county
alternative models of care pursuant to the pilot program. The
semiannual updates shall include key milestones, progress towards the
objectives of the pilot program, relevant or necessary changes to
the program, submittal of state plan amendments to the federal
Centers for Medicare and Medicaid Services, submittal of any federal
waiver documents, and other key activities related to the mandatory
enrollment of seniors and persons with disabilities into managed care
health plans or county alternative models of care. The department
 may   shall  also include updates on the
transition of individuals into managed care health plans and county
alternative models of care, the health outcomes of enrollees, the
care management and coordination process, and other information
concerning the success or overall status of the pilot program. 
   (2) (A) The requirement for submitting a report imposed under
paragraph (1) is inoperative on January 1, 2015, pursuant to Section
10231.5 of the Government Code.  
   (B) A report to be submitted pursuant to paragraph (1) shall be
submitted in compliance with Section 9795 of the Government Code.
 
   (s) 
    (t)  The department, in collaboration with the State
Department of Social Services and county welfare departments, shall
monitor the utilization and caseload of the In-Home Supportive
Services (IHSS) program before and during the implementation of the
pilot program. This information shall be monitored in order to
identify the impact of the pilot program on the IHSS program for the
affected population. 
   (t) 
    (u)  The department, in cooperation with the Department
of Managed Health Care, shall, at a minimum, monitor on a quarterly
basis the adequacy of provider networks of the managed care health
plans or county alternative models of care. 
   (u) 
    (v)  The department shall suspend new enrollment of
seniors and persons with disabilities into a managed care health plan
or county alternative care model if it determines that the managed
care health plan or county alternative care model does not have
sufficient primary or specialty providers to meet the needs of their
enrollees.
   SEC. 3.   SEC. 4.   Section 
14183.1  14182.1  is added to the Welfare and
Institutions Code, to read: 
   14183.1.  (a) Commencing January 1, 2011, all managed care health
plans and other managed care arrangements, including county
alternative models of care developed pursuant to Section 14183, as
the department shall specify, shall be required to submit data,
including, but not limited to, encounter data and financial data, in
the form of and to the specifications prescribed by the department
for the development of rates, monitoring plan performance, and
ensuring quality.
   (b) Failure of a managed care health plan or other managed care
arrangement to comply with the requirements established by the
department under this section shall result in a penalty, imposed by
the department monthly, of 2 percent of the total monthly capitation
rate for that plan or arrangement per month until the plan or
arrangement has fully complied with the requirements.
   (c) The requirements for reporting data, pursuant to subdivision
(a), shall apply to all services provided to members under this
chapter, Chapter 8 (commencing with Section 14200), and Chapter 8.75
(commencing with Section 14500), regardless of whether or not the
member is a senior or a person with a disability or disabilities.
   (d) Failure of a provider or subcontractor to submit data to a
managed care health plan or arrangement shall not relieve the plan or
arrangement from its responsibilities under this section and shall
not affect imposition of the penalty as described in subdivision (b).

    14182.1.   (a) Beginning March 2011, the department
shall convene a stakeholder workgroup to review the existing
encounter, claims, and financial data submission process required by
the department under managed care health plan contracts. The
workgroup members shall be selected by the department and shall
include interested representatives from Medi-Cal managed care health
plans, managed care health plan associations, hospitals, individual
health care providers, physician groups, and consumer
representatives. In reviewing the process, the department shall
consider input from the stakeholder workgroup and develop data
quality submission standards by October 2011.  
   (b)  Beginning January 1, 2012, managed care health plans and
county alternative models of care shall comply with the quality
submission standards developed pursuant to subdivision (a) when
submitting data to the department. The director may impose a penalty
for each month that a managed care health plan or county alternative
model of care fails to submit data in compliance with these
standards. The penalty shall be in proportion to that plan or
alternative model's failure to comply with the data submission
standards, as the director in his or her sole discretion determines,
and in no event shall the penalty exceed 2 percent of the total
monthly capitation rate for that plan or alternative model.

   (e) 
    (c)  Notwithstanding Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code, the department may implement, interpret, or make specific this
section by means of all-county letters, plan letters, plan or
provider bulletins, or similar instructions, without taking
regulatory action. If the department elects to adopt regulations, the
adoption of regulations shall be deemed an emergency and necessary
for the immediate preservation of the public peace, health and
safety, or general welfare.
  SEC. 4.   SEC. 5.   Section 
14183.5   14182.15  is added to the Welfare and
Institutions Code, to read:
    14183.5.   14182.15.   In conjunction
with the implementation of Section  14183  
14182  , the department shall work with counties to develop a
method to be used in determining the appropriate contribution to
cover the nonfederal share of inpatient hospital expenses for seniors
and persons with disabilities in the Medi-Cal program.
   SEC. 5.   SEC. 6.   Section 
14184   14182.2  is added to the Welfare and
Institutions Code, to read:
    14184.   14182.2.   (a) Notwithstanding
Section 14094.3, in furtherance of the  waiver or 
demonstration project developed pursuant to Section 14180, the
director shall establish, by January 1, 2012, organized health care
delivery models for children eligible for California Children
Services (CCS) under Article 5 (commencing with Section 123800) of
Chapter 3 of Part 2 of Division 106 of the Health and Safety Code.
These models shall include at least one of the following:
   (1) An enhanced primary care case management program.
   (2) A provider-based accountable care organization.
   (3) A specialty health care plan.
   (4) A Medi-Cal managed care plan that includes payment and
coverage for CCS-eligible conditions.
   (b) Each model shall do all of the following:
   (1) Establish clear standards and criteria for participation,
exemption, enrollment, and disenrollment.
   (2) Provide care coordination that links children and youth with
special health care needs with appropriate services and resources in
a coordinated manner to achieve optimum health.
   (3) Establish networks that include CCS-approved providers and
maintain the current system of regionalized pediatric specialty and
subspecialty services to ensure that children and youth have timely
access to appropriate and qualified providers.
   (4) Coordinate out-of-network access if appropriate and qualified
providers are not part of the network or in the region.
   (5) Ensure that children enrolled in the model receive care for
their CCS-eligible medical conditions from CCS-approved providers
consistent with the CCS standards of care.
   (6) Participate in a statewide quality improvement collaborative
that includes stakeholders.
   (7) Establish and support medical homes, incorporating all of the
following principles:
   (A) Each child has a personal physician.
   (B) The medical home is a physician-directed medical practice.
   (C) The medical home utilizes a whole child orientation.
   (D) Care is coordinated or integrated across all of the elements
of the health care system and the family and child's community.
   (E) Information, education, and support to consumers and families
in the program is provided in a culturally competent manner.
   (F) Quality and safety practices and measures.
   (G) Provides enhanced access to care, including access to
after-hours care.
   (H) Payment is structured appropriately to  recognized
  recognize  the added value provided to children
and their families.
   (8) Provide the department with data for quality monitoring and
improvement measures, as determined necessary by the department. The
department shall institute quality monitoring and improvement
measures that are appropriate for children and youth with special
health care needs.
   (c) The services provided under these models shall not be limited
to medically necessary services required to treat the CCS-eligible
medical condition.
   (d) Notwithstanding any other provision of law, and to the extent
permitted by federal law, the department may require eligible
individuals to enroll in these models.
   (e) At the election of the Managed Risk Medical Insurance Board,
and with the consent of the director, children enrolled in the
Healthy Families Program pursuant to Part 6.2 (commencing with
Section 12693) of Division 2 of the Insurance Code, who are eligible
for CCS under Article 5 (commencing with Section 123800) of Chapter 3
of Part 2 of Division 106 of the Health and Safety Code, may enroll
in the organized health care delivery models established under this
section.
   (f) For the purposes of implementing this section, the department
shall seek proposals to establish and test these models of organized
health care delivery systems, may enter into exclusive or
nonexclusive contracts on a bid or negotiated basis, and may amend
existing managed care contracts to provide or arrange for services
under this section. Contracts may be statewide or on a more limited
geographic basis. Contracts entered into or amended under this
section shall be exempt from the provisions of Chapter 2 (commencing
with Section 10290) of Part 2 of Division 2 of the Public Contract
Code and Chapter 6 (commencing with Section 14825) of Part 5.5 of
Division 3 of the Government Code.
   (g) (1) Entities contracting with the department under this
section shall report expenditures for the services provided under the
contract.
   (2) If a contractor is paid according to a capitated or risk-based
payment methodology, the rates shall be actuarially sound and take
into account care coordination activities.
   (h) (1) The department shall conduct an evaluation to assess the
effectiveness of each model in improving the delivery of health care
services for children who are eligible for CCS. The department shall
consult with stakeholders in developing an evaluation for the models
being tested.
   (2) The evaluation process shall begin simultaneously with the
development and implementation of the model delivery systems to
compare the care provided to, and outcomes of, children enrolled in
the models with those not enrolled in the models. The evaluation
shall include, at a minimum, an assessment of all of the following:
   (A) The types of services and expenditures for services.
   (B) Improvement in the coordination of care for children.
   (C) Improvement in the quality of care.
   (D) Improvement in the value of care provided.
   (E) The rate of growth of expenditures.
   (F) Parent satisfaction.
   (i) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, the
department may implement, interpret, or make specific this section
and any applicable federal waivers and state plan amendments by means
of all-county letters, plan letters, plan or provider bulletins, or
similar instructions, without taking regulatory action.
   SEC. 6.   SEC. 7.   Section 15908 of the
Welfare and Institutions Code is amended to read:
   15908.  (a) This part shall become inoperative on the date that
the director executes a declaration, which shall be retained by the
director and provided to the fiscal and appropriate policy committees
of the Legislature, stating that the federal demonstration project
provided for in this part has been terminated by the federal Centers
for Medicare and Medicaid Services, and shall, six months after the
date the declaration is executed, be repealed.
   (b) Notwithstanding subdivision (a), the director may
alternatively execute a declaration continuing the projects
established in this part, to the extent the projects are authorized
and consistent with the terms and conditions of a successor federal
waiver or demonstration project secured pursuant to Section 14180.
   (c) Notwithstanding subdivision (a), the director may continue and
administer any extensions, modifications, or continuation of the
projects under this part approved by the federal Centers for Medicare
and Medicaid Services.
   SEC. 7.   SEC. 8.   Part 3.6 (commencing
with Section 15909) is added to Division 9 of the Welfare and
Institutions Code, to read:

      PART 3.6.  Coverage Expansion and Enrollment Demonstration
Projects


   15909.  The Legislature finds and declares all of the following:
   (a) Pursuant to Section 14180, the Legislature directed the
department to apply for a successor federal waiver or demonstration
project, in part, to coincide with the end of the waiver described in
relevant part in subdivision (b) of Section 15900 to, among other
requirements, optimize opportunities to increase federal financial
participation and maximize financial resources to address
uncompensated care.
   (b) Passage of federal health care reform, pursuant to the federal
Patient Protection and Affordable Care Act (Public Law 111-148), as
amended by the federal Health Care and Education 
Reconciliation Act  of 2010  (Public Law 111-152), presents
new options of federal support for coverage of low-income individuals
and significant expansion of state coverage programs in 2014.
Through the success of the Health Care Coverage Initiatives
established pursuant to Part 3.5 (commencing with Section 15900), and
with implementation of a successor federal Medicaid waiver or
demonstration project, California is well positioned to develop
enrollment and coverage expansion models that will lead the way to
full implementation of comprehensive health care reforms in 2014.
   15910.  (a) Subject to federal approval of a successor Section
1115 Medicaid waiver or demonstration project effective on or after
September 1, 2010, the department shall, by no later than January 1,
2011, or alternatively, 180 days after federal approval of the
successor federal waiver or demonstration project, whichever occurs
later,  develop   authorize  local Coverage
Expansion and Enrollment Demonstration (CEED) projects to provide
scheduled health care benefits for uninsured adults 19 to 64,
inclusive, years of age, with incomes up to 200 percent of the
federal poverty level and who are not otherwise eligible for Medicare
or Medi-Cal, consistent with the terms and conditions of the
successor federal waiver or demonstration project.
   (b) Counties, consistent with the terms and conditions of the
successor federal waiver or demonstration project, may perform
outreach and enrollment activities to target populations, including,
but not limited to, the homeless, individuals who frequently use
hospital inpatient or emergency department services for avoidable
reasons, or people with mental health  or substance abuse 
treatment needs.
   (c) CEED projects shall be designed and implemented with the
systems and program elements necessary to facilitate the transition
of those eligible individuals to Medi-Cal coverage, or alternatively,
to coverage through the state health insurance exchange, by 2014,
pursuant to state and federal law, and the terms and conditions of
the successor federal waiver or demonstration project.
   (d) The department shall  develop   authorize
 projects that meet the requirements and desired outcomes set
forth in this part and the terms and conditions of the successor
federal waiver or demonstration project.
   (e) The projects shall include the following elements, subject to
the terms and conditions of the successor federal waiver or
demonstration project:
   (1) Development of standardized eligibility and enrollment
procedures that interface with Medi-Cal processes according to the
milestones developed in consultation with the counties, county health
departments, public hospitals, and county human service departments.
Coverage initiatives shall migrate to the standardized procedures in
accordance with the terms and conditions of the successor federal
waiver or demonstration project.
   (2) (A) Designation of a medical home and assignment of eligible
individuals to a primary care provider. For purposes of this
paragraph, "medical home" means a single provider or facility that
maintains all of an individual's medical information and, at a
minimum, coordinates health and medical care services for enrolled
individuals.
   (B) Provision of an enhanced medical home, to be specifically
defined by the terms and conditions of the successor federal waiver
or demonstration project, that targets those enrollees who are
frequent users of public inpatient hospital services or have been
diagnosed with chronic medical or mental health conditions. The
enhanced                                             medical home may
include case management services. 
   (C) CEED projects shall offer to contract, or subcontract, with an
entity licensed as a primary care clinic pursuant to subdivision (a)
of Section 1204 of the Health and Safety Code that qualifies to
serve as a medical home, as defined in subparagraph (A) of paragraph
(2) of subdivision (e) of Section 15910, or an enhanced medical home,
as defined in subparagraph (B) of paragraph (2) of subdivision (e)
of Section 15910. 
   (3) Provision of the scheduled benefit package of services
required under the terms and conditions of the successor federal
waiver or demonstration project described in subdivision (a).
   (4) A provider network and service delivery system that includes
participation by public and private providers in order to provide the
scheduled services in the project, and to ensure the capacity to
transition those eligible individuals to the applicable Medi-Cal
coverage, or alternatively, to coverage through the state health
insurance exchange, in 2014.
   (5) Development of an outreach and enrollment plan that does both
of the following:
   (A) Reaches potential project enrollees.
   (B) Includes the public and private providers necessary to serve
those eligible individuals in Medi-Cal coverage, or alternatively, in
coverage through the state health insurance exchange, beginning in
2014.
   (6) A quality measurement and quality monitoring system.
   (7) Data tracking systems to provide the department with required
data for quality monitoring, quality improvement, and evaluation.
   (8) The ability to demonstrate how the CEED projects will promote
the viability of the existing safety net health care system.
   (9) Demonstration of how the CEED projects will provide consumer
assistance to individuals applying for, participating in, or
accessing, services in the projects.
   (10) Ability to meet program requirements, standards, and
performance measurements developed by the department, in consultation
with participating counties, for the CEED projects.
   (f) A CEED project provider network and service delivery system
may include contracts or subcontracts with primary care clinics
licensed under subdivision (a) of Section 1204 of the Health and
Safety Code.
   (g) Services provided pursuant to this part shall be available to
those eligible uninsured individuals enrolled in the applicable CEED
project. Notwithstanding any other provision of law, nothing in this
part shall be construed to create an entitlement program of any kind.

   (h) CEED projects shall be established and implemented only to the
extent that federal financial participation is available  and
only to the extent that available federal financial participation is
not jeopardized  .
   15911.  (a) A county, city and county, consortium of counties
serving a region consisting of more than one county, or health
authority shall be eligible to apply for a CEED project federal fund
allocation.
   (b) The department shall develop methodologies for distributing
available federal funds for the projects established by this part and
for determining the amount of federal funding available, consistent
with the terms and conditions of the successor federal waiver or
demonstration project.
   (c) The department shall seek to balance the allocations
throughout geographic areas of the state, consistent with the terms
and conditions of the successor federal waiver or demonstration
project.
   (d) Each county, city and county, consortium of counties, or
health authority that chooses  and is authorized by the
department  to administer a CEED project and receive federal
funding shall provide the necessary local funds for the nonfederal
share of the certified public expenditures, or intergovernmental
transfers to the extent allowable under the successor federal waiver
or demonstration project, required to claim the federal funds made
available from the federal allotment. The certified public
expenditures or intergovernmental transfers, to the extent allowable
under the successor federal waiver or demonstration project, shall
meet the requirements of the terms and conditions of the successor
federal waiver or demonstration project referenced in subdivision (a)
of Section 15910. Nothing in this part shall be construed to require
a political subdivision of the state to participate in the CEED
project, and those local funds expended for the nonfederal share of
CEED project services under this part shall be considered voluntary
contributions for purposes of the federal Patient Protection and
Affordable Care Act (Public Law 111-148), as amended by the federal
Health Care and  Education  Reconciliation Act  of 2010
 (Public Law 111-152), and the federal American Recovery and
Reinvestment Act of 2009 (Public Law 111-5), as amended by the
Patient Protection and Affordable Care Act.
   (e)  Selected   CEED   
projects shall expend the funds according to an expenditure schedule
determined by the department consistent with the terms and conditions
of the successor federal waiver or demonstration project described
in subdivision (a) of Section 15910.
   (f) Except as otherwise provided in the annual Budget Act, no
state General Fund moneys shall be used to fund CEED project
services, nor to fund any related administrative costs 
provided to   incurred by  counties or any other
political subdivision of the state.
   (g) The department may reallocate the available federal funds
among selected projects, if necessary, to maximize receipt of federal
funds or meet federal requirements regarding the timing of
expenditures. Selected projects receiving reallocated funds must have
the ability to make the certified public expenditures necessary to
claim the applicable reallocated federal funds. 
   (h) (1) On and after January 1, 2014, California shall implement
comprehensive health care reform for the populations targeted by the
CEED in compliance with federal health care reform law, regulation,
and policy, including the federal Patient Protection and Affordable
Care Act (Public Law 111-148), as amended by the federal Health Care
and Education Reconciliation Act of 2010 (Public Law 111-152), and
subsequent amendments.  
   (2) To the extent permitted by paragraph (1), implementation of
comprehensive health care reform shall include the implementation of
prospective payment system reimbursement for federally qualified
health centers and rural health clinics as described in Section
14132.100 for federally qualified health services or rural health
clinic services to beneficiaries newly covered under the Medi-Cal
program and as set forth in subdivision (d) of Section 1302 of Part I
of Subtitle D of the federal Patient Protection and Affordable Care
Act. 
   15912.  (a) The department shall ensure that the CEED projects
established under this part are evaluated to determine to what extent
the projects have met the requirements of the successor federal
waiver or demonstration project referenced in this part and
successfully developed the necessary systems and program elements
required to transition those eligible persons to Medi-Cal coverage,
or alternatively, to coverage through the state health insurance
exchange, in 2014.
   (b) The department may seek federal or private funds or enter into
partnership with an independent, nonprofit group or foundation, an
academic institution, or a governmental entity providing grants for
health-related activities, to evaluate the programs funded under this
part.
   15913.  Notwithstanding Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code, the
department may implement, interpret, or make specific this part, and
the terms and conditions of the successor federal waiver or
demonstration project secured pursuant to subdivision (a) of Section
15910, by means of all-county letters, plan letters, plan or provider
bulletins, or similar instructions.
   15914.   This   A request for information, or
similar process, used by the department to authorize entities to
operate CEED projects and any agreements entered into by, or modified
by, the department for purposes of this  part shall not be
subject to Part 2 (commencing with Section 10100) of Division 2 of
the Public Contract Code.
   15915.  In the event of a conflict between a provision of this
part and a term or condition of the successor federal waiver or
demonstration project pursuant to subdivision (a) of Section 15910,
the terms and conditions of the successor federal waiver or
demonstration project shall control.
   SEC. 7.   SEC. 9.   This act is an
urgency statute necessary for the immediate preservation of the
public peace, health, or safety within the meaning of Article IV of
the Constitution and shall go into immediate effect. The facts
constituting the necessity are:
   In order to make changes to state funded health care programs at
the earliest possible time, it is necessary that this act take effect
immediately.