Existing law establishes the Medi-Cal program, administered by the State Department of Health Care Services, under which basic health care services are provided to qualified low-income persons. The Medi-Cal program is, in part, governed and funded by federal Medicaid provisions. Existing law provides that specialty mental health services are covered under the Medi-Cal program for eligible Medi-Cal beneficiaries and coverage for those services is provided through mental health managed care plans.

Existing law, the Bronzan-McCorquodale Act, contains provisions governing the organization and financing of community mental health services for persons with mental disorders in every county through locally administered and locally controlled community mental health programs. Existing law provides for reimbursements through the Medi-Cal program for mental health services to Medi-Cal eligible individuals receiving mental health services from county mental health programs, among other funding sources for community mental health services. Existing law requires, regardless of the funding source involved, fees to be charged in accordance with the ability to pay for specialty mental health services rendered, but not in excess of actual costs, as specified.

This bill would instead prohibit a county from charging fees for Medi-Cal specialty mental health services to Medi-Cal beneficiaries who do not have a share of cost and Medi-Cal beneficiaries who have met their share of cost, and would authorize a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, in accordance with the patients ability to pay for community mental health services rendered, but not in excess of actual costs. The bill would also specify that these provisions shall not be construed to waive a countys responsibility to screen for eligibility for Medi-Cal, any other insurance affordability program, or a county health program.

Existing law establishes the Medi-Cal program, administered by the State Department of Health Care Services, under which basic health care services are provided to qualified low-income persons. The Medi-Cal program is, in part, governed and funded by federal Medicaid provisions. Existing law provides that specialty mental health services are covered under the Medi-Cal program for eligible Medi-Cal beneficiaries and coverage for those services is provided through mental health managed care plans.

Existing law, the Bronzan-McCorquodale Act, contains provisions governing the organization and financing of community mental health services for persons with mental disorders in every county through locally administered and locally controlled community mental health programs. Existing law provides for reimbursements through the Medi-Cal program for mental health services to Medi-Cal eligible individuals receiving mental health services from county mental health programs, among other funding sources for community mental health services. Existing law requires, regardless of the funding source involved, fees to be charged in accordance with the ability to pay for specialty mental health services rendered, but not in excess of actual costs, as specified.

This bill would instead prohibit a county from charging fees for Medi-Cal specialty mental health services to Medi-Cal beneficiaries who do not have a share of cost and Medi-Cal beneficiaries who have met their share of cost, and would authorize a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, in accordance with the patients ability to pay for community mental health services rendered, but not in excess of actual costs. The bill would also specify that these provisions shall not be construed to waive a countys responsibility to screen for eligibility for Medi-Cal, any other insurance affordability program, or a county health program.

Existing law establishes the Medi-Cal program, administered by the State Department of Health Care Services, under which basic health care services are provided to qualified low-income persons. The Medi-Cal program is, in part, governed and funded by federal Medicaid provisions. Existing law provides that specialty mental health services are covered under the Medi-Cal program for eligible Medi-Cal beneficiaries and coverage for those services is provided through mental health managed care plans.

Existing law, the Bronzan-McCorquodale Act, contains provisions governing the organization and financing of community mental health services for persons with mental disorders in every county through locally administered and locally controlled community mental health programs. Existing law provides for reimbursements through the Medi-Cal program for mental health services to Medi-Cal eligible individuals receiving mental health services from county mental health programs, among other funding sources for community mental health services. Existing law requires, regardless of the funding source involved, fees to be charged in accordance with the ability to pay for specialty mental health services rendered, but not in excess of actual costs, as specified.

This bill would instead prohibit a county from charging fees for Medi-Cal specialty mental health services to Medi-Cal beneficiaries who do not have a share of cost and Medi-Cal beneficiaries who have met their share of cost, and would authorize a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, in accordance with the patients ability to pay for community mental health services rendered, but not in excess of actual costs. The bill would also specify that these provisions shall not be construed to waive a countys responsibility to screen for eligibility for Medi-Cal, any other insurance affordability program, or a county health program.

Existing law establishes the Medi-Cal program, administered by the State Department of Health Care Services, under which basic health care services are provided to qualified low-income persons. The Medi-Cal program is, in part, governed and funded by federal Medicaid provisions. Existing law provides that specialty mental health services are covered under the Medi-Cal program for eligible Medi-Cal beneficiaries and coverage for those services is provided through mental health managed care plans.

Existing law, the Bronzan-McCorquodale Act, contains provisions governing the organization and financing of community mental health services for persons with mental disorders in every county through locally administered and locally controlled community mental health programs. Existing law provides for reimbursements through the Medi-Cal program for mental health services to Medi-Cal eligible individuals receiving mental health services from county mental health programs, among other funding sources for community mental health services. Existing law requires, regardless of the funding source involved, fees to be charged in accordance with the ability to pay for specialty mental health services rendered, but not in excess of actual costs, as specified.

This bill would instead prohibit a county from charging fees for Medi-Cal specialty mental health services to Medi-Cal beneficiaries who do not have a share of cost and Medi-Cal beneficiaries who have met their share of cost, and would authorize a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, in accordance with the patients ability to pay for community mental health services rendered, but not in excess of actual costs.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2393

Author:(Committee on Health)

As Amended Ver:May 22, 2018

Majority vote

Original Committee Reference: HEALTH

SUMMARY: Prohibits a county from charging fees for Medi-Cal specialty mental health services (SMHS) to Medi-Cal beneficiaries who do not have a share of cost and Medi-Cal beneficiaries who have met their share of cost. Allows, instead of requires, a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, as specified. Deletes the term SMHS and replaces it with community mental health services. Provides that this bill shall not be construed to waive a county's responsibility to screen for eligibility for Medi-Cal, any other insurance affordability program, or a county health program.

The Senate amendments provide that this bill shall not be construed to waive a county's responsibility to screen for eligibility for Medi-Cal, any other insurance affordability program, or a county health program.

EXISTING LAW:

1. Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), under which health care services are provided to qualified, low-income persons.
2. Establishes a schedule of benefits for Medi-Cal beneficiaries, including mental health services.
3. Establishes the Short-Doyle Program, wherein counties were required to ensure delivery of mental health services utilizing a system of county operated and contract providers.
4. Establishes the Bronzan-McCorquodale Act which shifted control of social and health service program to counties, provided counties with a more stable revenue stream from taxes and vehicle registration fees, and changed the state-county funding ratios. Realigns under the Bronzan-McCorquodale Act the following mental health services programs to counties: a) all community-based mental health services; b) State hospital services for civil commitments; and, c) "Institutions for Mental Disease" which provided long-term nursing facility care.

FISCAL EFFECT: None

COMMENTS: According to the author, this bill would bring existing law into compliance with federal parity regulations which prohibit Medi-Cal from charging beneficiaries more to access mental health services than medical/surgical services. Existing statute requires county mental health plans (MHPs) to charge individuals, including Medi-Cal beneficiaries, for SMHS, based upon the individual's ability to pay; however, Medi-Cal managed care (MCMC) plans do not charge fees to Medi-Cal beneficiaries for medical/surgical services. In order to comply with the federal parity regulations, this bill would amend existing law to prohibit county MHPs from charging fees to Medi-Cal beneficiaries for mental health services.

1. Mental health services under Medi-Cal. Currently, MCMC plans are required to provide mental health benefits covered in the state plan, except those benefits provided by MHPs under the SMHS Waiver (discussed below). MCMC plans cover the following mental health services: individual and group mental health evaluation and treatment (psychotherapy), psychological testing (when clinically indicated) outpatient services for the purposes of monitoring drug therapy, outpatient laboratory, drugs, supplies and supplements, and psychiatric consultation. MCMC plans are also obligated to cover outpatient mental health services to beneficiaries with mild to moderate impairment of mental, emotional or behavioral functioning, and for this reason, the scope of services provided by MCMC plans is often referred to as "mild to moderate."

Under Section 1915 (b) of the SMHS Waiver, California continues to provide SMHS to Medi-Cal beneficiaries through the MHPs. SMHS are those mental health services which are provided to Medi-Cal beneficiaries who meet medical necessity criteria (a person must have a listed diagnosis, and meet specified impairment and intervention criteria). SMHS include rehabilitative mental health services, medication support, day treatment intervention, crisis stabilization, adult residential treatment, crisis residential treatment, psychiatric health facility services, psychologist services, and psychiatric nursing facility services.

1. Share of Cost Medi-Cal. Under share of cost Medi-Cal, beneficiaries must incur a predetermined amount of health care expenses each month before Medi-Cal begins to offer assistance for that month. When the share of cost has been met, Medi-Cal pays for any additional covered expenses for the month. Share of cost requirements are not the same as cost-sharing or copay requirements. Cost-sharing requires a recipient to pay a set amount or percentage of each health care service received while share of cost requires recipients to take full responsibility for health care expenses up to a predetermined amount. Examples of share of cost recipients include those who are eligible through the medically needy program comprised of the aged, blind and disabled people, and those that qualify for the medically indigent program.
2. Uniform fee schedule. The state requires that clients and their families must pay, according to their ability, towards the cost of care that is received from any MHP under the Short-Doyle Act. The client/families ability to pay is assessed according to the plan known as the "Uniform Method of Determining Ability to Pay (UMDAP)."

The UMDAP process was developed and implemented in state fiscal year 1972-73 for use by Short-Doyle funded county mental health departments and their contract providers. The former Department of Mental Health established a uniform fee schedule based upon a patient's monthly adjusted gross family income (MAGFI) and number of dependents. County mental health departments are required to complete a financial screening document on each patient served to determine that patient's ability to pay and to establish an annual liability for the patient based upon the patient's MAGFI and number of dependents.

UMDAP now generally applies to individuals who are indigent and Medi-Cal beneficiaries who have a share of cost. UMDAP also applies to non-Medi-Cal services provided to eligible residents, including Medi-Cal beneficiaries. If an individual has private insurance, county mental health departments bill the private insurance. If an individual is enrolled in Medicare, county mental health departments bill Medicare. If an individual is enrolled in Medi-Cal, county mental health departments bill through the Short-Doyle system in order to draw down federal funds; however, individuals who are enrolled in Medi-Cal with a share of cost requirement are subject to UMDAP until the share of cost is met.

1. Mental Health Parity. In 1996, the United States Congress passed the Mental Health Parity Act (MHPA), which prohibits large group health plans from imposing higher annual or lifetime dollar limits on mental health benefits. However, the MHPA did not mandate coverage for mental health services and only applied to group health plans that offered mental health benefits. The MHPA also did not apply to substance use disorders, services limits, limitations on the types of facilities covered, or differences in cost sharing, and plans could have stricter prior authorization requirements for mental health services than for other medical services.

In 1999, California passed AB 88 (Thompson), Chapter 534, Statutes of 1999, which requires a health plan contract or disability insurance policy to provide coverage for the diagnosis and medically necessary services of severe mental illnesses of a person of any age and of serious emotional disturbances of a child. Benefits must be applied under the same terms and conditions as applied to other medical conditions. AB 88 also requires copayments, deductibles and maximum lifetime benefits to be applied equally to all benefits under the plan.

In 2008, Congress passed the federal Paul Wellstone and Pete Dominici Mental Health Parity and Addiction Equity Act of 2008 (Act) to cover some of the gaps in the MHPA. Similar to the MHPA, the Act only applies to large-group health plans. However, the Act also included Medicare Advantage plans offered through group health plans, state and local government plans, Medicaid managed care plans, and state Children's Health Insurance Program plans. Unlike the MHPA, the Act prohibited differences in service limits, cost-sharing, and in-and-out-of-network coverage, and applied to services for substance use disorders.

The Act requires, if health plans include services for mental health or substance use disorders as part of their benefits, to provide those services under the same terms and conditions as other medical services. The Act eliminated all differences between mental health and substance use disorder services and other medical services as they related to: services and visit limits; deductibles; copayments; coinsurance; and, the use of out-of-network providers when a health plan gave this option. Further, federal regulations in 2010 and then the final rule in 2013, prohibited health plans from imposing a financial requirement or services limit restriction that is more restrictive than what they offered for medical and surgical benefits in the same classification.

This bill is necessary because existing statute currently requires MHPs to charge individuals, including Medi-Cal beneficiaries, a fee for SMHS based upon an individual's ability to pay. However, managed care plans do not impose any type of financial requirements on beneficiaries for medical/surgical services.

Analysis Prepared by: Rosielyn Pulmano / HEALTH / (916) 319-2097 FN: 0003530

 CONSENT  

Bill No: AB 2393

Author:

:

Vote:

SENATE HEALTH COMMITTEE: 8-0, 6/6/18

AYES: Hernandez, Nguyen, Leyva, Mitchell, Monning, Nielsen, Pan, Roth

NO VOTE RECORDED: Newman

ASSEMBLY FLOOR: 71-0, 4/19/18 (Consent) - See last page for vote

SUBJECT:

SOURCE: Author

DIGEST:

This bill prohibits a county from charging fees for Medi-Cal specialty mental health services to Medi-Cal beneficiaries who either do not have a share of cost or who have met their share of cost. This bill permits a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, based on their ability to pay for community mental health services, instead of requiring counties to charge a fee for specialty mental health services under existing law.

ANALYSIS:

Existing law:

1. Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), under which health care services are provided to qualified low-income persons. [WIC §14000, et seq.]
   
2. Requires DHCS to implement managed mental health care for Medi-Cal beneficiaries through contracts with mental health plans. Permits mental health plans (MHP) to include individual counties, counties acting jointly, or an organization or nongovernmental entity determined by DHCS to meet MHP standards, and permits contracts to be exclusive and awarded on a geographic basis. [WIC §14712]
   
3. Establishes requirements for specialty mental health services (SMHS) provided by counties to Medi-Cal eligible individuals, including requiring counties to provide services to Medi-Cal beneficiaries and to seek the maximum federal reimbursement possible for services rendered to persons with mental illnesses. [WIC §14705]
   
4. Requires Medi-Cal managed care plans to provide mental health benefits covered in the state plan, excluding those benefits provided by county MHPs under the Specialty Mental Health Services Waiver. [WIC §14189]
5. Requires, under the Bronzan-McCorquodale Act, fees to be charged in charged in accordance with the ability to pay for SMHS rendered but not in excess of actual costs, regardless of the funding source involved. [WIC §5709]
6. Prohibits, under federal mental health parity regulations, a Medicaid State Plan from applying any financial requirement or treatment limitation to mental health or substance use disorder benefits in any classification that is more restrictive than the predominant financial requirement or treatment limitation of that type applied to substantially all medical/surgical benefits in the same classification. Defines “financial requirements” to include deductibles, copayments, coinsurance, or out-of-pocket maximums. [42 CFR §457.496]

This bill:

1. Prohibits a county from charging fees for Medi-Cal SMHS to:
   1. Medi-Cal beneficiaries who do not have a share of cost; and,
   2. Medi-Cal beneficiaries who have met their share of cost.
      
2. Permits a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, in accordance with their ability to pay for community mental health services, instead of requiring counties to charge a fee for SMHS under existing law.
   
3. Prohibits this bill from being construed to waive a county’s responsibility to screen for eligibility for Medi-Cal, any other insurance affordability program, or a county health program.

Comments

1. Author’s statement. According to the author, this bill would bring existing law into compliance with federal parity regulations, which prohibit Medi-Cal from charging beneficiaries more to access mental health services than medical/surgical services. Existing statute requires county MHPs to charge individuals, including Medi-Cal beneficiaries, for SMHS, based upon the individual’s ability to pay. However, managed care plans do not charge fees to Medi-Cal beneficiaries for medical/surgical services. In order to comply with the federal parity regulations, this bill would amend the state statute to prohibit county MHPs from charging fees to Medi-Cal beneficiaries for mental health services. Further, the bill proposes technical clarifying amendments to ensure appropriate implementation of the amendments.
   
2. Mental health parity and existing law. Existing law prohibits charges for the care and treatment of each patient receiving service from a county mental health program from exceeding the actual cost thereof as determined or approved by the Director of DHCS in accordance with standard accounting practices. The Uniform Method of Determining Ability to Pay (UMDAP) is a sliding scale of liabilities for the patient based on the individual or responsible party’s ability to pay for mental health services. The UMDAP was developed and implemented in 1972-73 for use by Short-Doyle funded county mental health departments and their contract providers. The former Department of Mental Health established a uniform fee schedule based upon a patient’s monthly adjusted gross family income (MAGFI) and number of dependents. County MHPs are required to complete a financial screening document on each patient served to determine that patient’s ability to pay and to establish an annual liability for the patient based upon the patient’s MAGFI and number of dependents. UMDAP, under current practice, generally applies to individuals who are indigent and Medi-Cal beneficiaries who have a share of cost that has not been met. UMDAP also applies to non-Medi-Cal services provided to eligible residents, including Medi-Cal beneficiaries. However, current law requires mental health plans to charge a fee for Medi-Cal specialty mental health services, even if a Medi-Cal beneficiary does not have a share of cost or has met their share of cost.
   
   Federal mental health parity regulations essentially require that any financial requirements applicable to mental health benefits cannot be higher than the comparable financial requirements applicable to medical/surgical benefits in the same classification (inpatient, outpatient, prescription drugs and emergency services). Financial requirements are defined to include deductibles, copayments, coinsurance and out-of-pocket maximums. If a type of financial requirement does not apply to substantially all medical/surgical benefits in a classification, it cannot be applied to mental health benefits in that classification. Because Medi-Cal managed care plans do not currently charge fees to Medi-Cal beneficiaries for medical/surgical services, MHPs may not charge fees to Medi-Cal beneficiaries who do not have a share of cost or who have a share of cost that has been met. DHCS was required to be in compliance with the federal parity requirements by October 2, 2017.

FISCAL EFFECT: Appropriation: No Fiscal Com.: No Local: No

SUPPORT: (Verified 6/6/18)

California Pan-Ethnic Health Network

California Access Coalition

CaliforniaHealth+ Advocates

Department of Health Care Services

Western Center on Law and Poverty

OPPOSITION: (Verified 6/6/18)

None received

ARGUMENTS IN SUPPORT: This bill is supported by DHCS, which states it would bring existing law into compliance with federal mental health parity regulations, which prohibit Medi-Cal from charging beneficiaries more to access mental health services than medical or surgical services. This bill would rectify the parity issue by clarifying that county specialty mental health plans may not charge Medi-Cal beneficiaries who do not have a share of cost or have met their share of cost a fee for Medi-Cal mental health services. In addition, it would allow counties to choose whether or not they want to charge these fees to non-Medi-Cal beneficiaries or Medi-Cal beneficiaries who have a share of cost that has not been met, which would not conflict with the federal parity regulations.

ASSEMBLY FLOOR: 71-0, 4/19/18

AYES: Acosta, Aguiar-Curry, Travis Allen, Arambula, Baker, Berman, Bigelow, Bloom, Bonta, Brough, Burke, Caballero, Carrillo, Cervantes, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dahle, Daly, Eggman, Flora, Fong, Frazier, Friedman, Gallagher, Gipson, Gloria, Gonzalez Fletcher, Gray, Grayson, Harper, Holden, Irwin, Jones-Sawyer, Kalra, Kamlager-Dove, Kiley, Lackey, Levine, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk-Silva, Reyes, Rubio, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Voepel, Waldron, Weber, Wood, Rendon

NO VOTE RECORDED: Calderon, Cristina Garcia, Eduardo Garcia, Melendez, Mullin, Quirk, Rodriguez

Prepared by:

6/7/18 15:12:45

**** END ****

SENATE COMMITTEE ON HEALTH

Senator Ed Hernandez, O.D., Chair

BILL NO: AB 2393

SUBJECT: Mental health

SUMMARY:

Prohibits a county from charging fees for Medi-Cal specialty mental health services to Medi-Cal beneficiaries who either do not have a share of cost or who have met their share of cost. Permits a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, based on their ability to pay for community mental health services, instead of requiring counties to charge a fee for specialty mental health services under existing law.

Existing law:

1. Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), under which health care services are provided to qualified low-income persons. [WIC §14000, et seq.]
   
2. Entitles medically needy persons and medically needy family persons to health care services under Medi-Cal, provided all Medi-Cal eligibility criteria are met. Prohibits a medically needy family person, medically needy person or state-only Medi-Cal persons from being entitled to receive Medi-Cal funded health care services during any month in which his or her share of cost has not been met. [WIC §14005.7]
   
3. Requires DHCS to implement managed mental health care for Medi-Cal beneficiaries through contracts with mental health plans. Permits mental health plans (MHP) to include individual counties, counties acting jointly, or an organization or nongovernmental entity determined by DHCS to meet MHP standards, and permits contracts to be exclusive and awarded on a geographic basis. [WIC §14712]
   
4. Establishes requirements for specialty mental health services (SMHS) provided by counties to Medi-Cal eligible individuals, including requiring counties to provide services to Medi-Cal beneficiaries and to seek the maximum federal reimbursement possible for services rendered to persons with mental illnesses. Requires, to the extent permitted by federal law, funds distributed to the counties from the Mental Health Subaccount, the Mental Health Equity Subaccount, and the Vehicle License Collection Account of the Local Revenue Fund, funds from the Mental Health Account and the Behavioral Health Subaccount of the Local Revenue Fund 2011, funds from the Mental Health Services Fund, and any other funds from which the Controller makes distributions to the counties to be used to pay for services provided by these funds that the counties can then certify as public expenditures in order to achieve the maximum federal reimbursement possible for services. [WIC §14705]
   
5. Requires Medi-Cal managed care plans to provide mental health benefits covered in the state plan, excluding those benefits provided by county MHPs under the Specialty Mental Health Services Waiver. [WIC §14189]
6. Requires, under the Bronzan-McCorquodale Act, fees to be charged in charged in accordance with the ability to pay for SMHS rendered but not in excess of actual costs, regardless of the funding source involved. [WIC §5709]
7. Prohibits, under federal mental health parity regulations, a Medicaid State Plan from applying any financial requirement or treatment limitation to mental health or substance use disorder benefits in any classification that is more restrictive than the predominant financial requirement or treatment limitation of that type applied to substantially all medical/surgical benefits in the same classification. Defines “financial requirements” to include deductibles, copayments, coinsurance, or out-of-pocket maximums. [42 CFR §457.496]

This bill:

1. Prohibits a county from charging fees for Medi-Cal SMHS to:
   
2. Medi-Cal beneficiaries who do not have a share of cost; and,
3. Medi-Cal beneficiaries who have met their share of cost.
   
4. Permits a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, in accordance with their ability to pay for community mental health services, instead of requiring counties to charge a fee for SMHS under existing law.
   
5. Prohibits this bill from being construed to waive a county’s responsibility to screen for eligibility for Medi-Cal, any other insurance affordability program, or a county health program.

FISCAL EFFECT:

This bill is keyed non-fiscal.

PRIOR VOTES:

COMMENTS:

1. Author’s statement. According to the author, this bill would bring existing law into compliance with federal parity regulations, which prohibit Medi-Cal from charging beneficiaries more to access mental health services than medical/surgical services. Existing statute requires county MHPs to charge individuals, including Medi-Cal beneficiaries, for SMHS, based upon the individual’s ability to pay. However, managed care plans do not charge fees to Medi-Cal beneficiaries for medical/surgical services. In order to comply with the federal parity regulations, this bill would amend the state statute to prohibit county MHPs from charging fees to Medi-Cal beneficiaries for mental health services. Further, the bill proposes technical clarifying amendments to ensure appropriate implementation of the amendments.
   
2. Mental health parity and existing law. Existing law prohibits charges for the care and treatment of each patient receiving service from a county mental health program from exceeding the actual cost thereof as determined or approved by the Director of DHCS in accordance with standard accounting practices. The Uniform Method of Determining Ability to Pay (UMDAP) is a sliding scale of liabilities for the patient based on the individual or responsible party’s ability to pay for mental health services. The UMDAP was developed and implemented in 1972-73 for use by Short-Doyle funded county mental health departments and their contract providers. The former Department of Mental Health established a uniform fee schedule based upon a patient’s monthly adjusted gross family income (MAGFI) and number of dependents. County MHPs are required to complete a financial screening document on each patient served to determine that patient’s ability to pay and to establish an annual liability for the patient based upon the patient’s MAGFI and number of dependents. UMDAP, under current practice, generally applies to individuals who are indigent and Medi-Cal beneficiaries who have a share of cost that has not been met. UMDAP also applies to non-Medi-Cal services provided to eligible residents, including Medi-Cal beneficiaries. However, current law requires mental health plans to charge a fee for Medi-Cal specialty mental health services, even if a Medi-Cal beneficiary does not have a share of cost or has met their share of cost.
   
   Federal mental health parity regulations essentially require that any financial requirements applicable to mental health benefits cannot be higher than the comparable financial requirements applicable to medical/surgical benefits in the same classification (inpatient, outpatient, prescription drugs and emergency services). Financial requirements are defined to include deductibles, copayments, coinsurance and out-of-pocket maximums. If a type of financial requirement does not apply to substantially all medical/surgical benefits in a classification, it cannot be applied to mental health benefits in that classification. Because Medi-Cal managed care plans do not currently charge fees to Medi-Cal beneficiaries for medical/surgical services, MHPs may not charge fees to Medi-Cal beneficiaries who do not have a share of cost or who have a share of cost that has been met. DHCS was required to be in compliance with the federal parity requirements by October 2, 2017.
   
3. Prior legislation. SB 171 (Hernandez, Chapter 768, Statutes of 2017) requires DHCS to ensure that all covered mental health benefits and substance use disorder benefits are provided in compliance with federal mental health parity regulations, and any subsequent amendment to those regulations, and any associated federal policy guidance issued by the federal Centers for Medicare and Medicaid Services.
4. Support. This bill is supported by DHCS, which states it would bring existing law into compliance with federal mental health parity regulations, which prohibit Medi-Cal from charging beneficiaries more to access mental health services than medical or surgical services. This bill would rectify the parity issue by clarifying that county specialty mental health plans may not charge Medi-Cal beneficiaries who do not have a share of cost or have met their share of cost a fee for Medi-Cal mental health services. In addition, it would allow counties to choose whether or not they want to charge these fees to non-Medi-Cal beneficiaries or Medi-Cal beneficiaries who have a share of cost that has not been met, which would not conflict with the federal parity regulations.

SUPPORT AND OPPOSITION:

Support: California Pan-Ethnic Health Network

California Access Coalition

CaliforniaHealth+ Advocates

Department of Health Care Services

Western Center on Law and Poverty

Oppose: None received

-- END --

Date of Hearing: April 10, 2018

ASSEMBLY COMMITTEE ON HEALTH

Jim Wood, Chair

ABPCA Bill Id:AB 2393

Author:(Committee on Health) – As Introduced Ver:February 14, 2018

SUBJECT: Mental health.

SUMMARY: Prohibits a county from charging fees for Medi-Cal specialty mental health services (SMHS) to Medi-Cal beneficiaries who do not have a share of cost and Medi-Cal beneficiaries who have met their share of cost. Allows, instead of requires, a county to charge fees to individuals who are not Medi-Cal beneficiaries and Medi-Cal beneficiaries who have a share of cost that has not been met, as specified. Deletes the term SMHS and replaces it with community mental health services.

EXISTING LAW:

1. Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), under which health care services are provided to qualified, low-income persons.
2. Establishes a schedule of benefits for Medi-Cal beneficiaries, including mental health services.
3. Establishes the Short-Doyle Program, wherein counties were required to ensure delivery of mental health services utilizing a system of county operated and contract providers.
4. Establishes the Bronzan-McCorquodale Act which shifted control of social and health service program to counties, provided counties with a more stable revenue stream from taxes and vehicle registration fees, and changed the state-county funding ratios. Realigns under the Bronzan-McCorquodale Act the following mental health services programs to counties: a) all community-based mental health services; b) State hospital services for civil commitments; and, c) “Institutions for Mental Disease” which provided long-term nursing facility care.

FISCAL EFFECT: None.

COMMENTS:

1. PURPOSE OF THIS BILL. According to the author, this bill would bring existing law into compliance with federal parity regulations which prohibit Medi-Cal from charging beneficiaries more to access mental health services than medical/surgical services. Existing statute requires county mental health plans (MHPs) to charge individuals, including Medi-Cal beneficiaries, for SMHS, based upon the individual’s ability to pay; however, Medi-Cal managed care (MCMC) plans do not charge fees to Medi-Cal beneficiaries for medical/surgical services. In order to comply with the federal parity regulations, this bill would amend existing law to prohibit county MHPs from charging fees to Medi-Cal beneficiaries for mental health services.
   
2. BACKGROUND.
   
   1. Mental health services under Medi-Cal. Currently, MCMC plans are required to provide mental health benefits covered in the state plan, except those benefits provided by MHPs under the SMHS Waiver (discussed below). MCMC plans cover the following mental health services: individual and group mental health evaluation and treatment (psychotherapy), psychological testing (when clinically indicated) outpatient services for the purposes of monitoring drug therapy, outpatient laboratory, drugs, supplies and supplements, and psychiatric consultation. MCMC plans are also obligated to cover outpatient mental health services to beneficiaries with mild to moderate impairment of mental, emotional or behavioral functioning, and for this reason, the scope of services provided by MCMC plans is often referred to as “mild to moderate.”
      
      Under Section 1915 (b) of the SMHS Waiver, California continues to provide SMHS to Medi-Cal beneficiaries through the MHPs. SMHS are those mental health services which are provided to Medi-Cal beneficiaries who meet medical necessity criteria (a person must have a listed diagnosis, and meet specified impairment and intervention criteria). SMHS include rehabilitative mental health services, medication support, day treatment intervention, crisis stabilization, adult residential treatment, crisis residential treatment, psychiatric health facility services, psychologist services, and psychiatric nursing facility services.
      
   2. Share of Cost Medi-Cal. Under share of cost Medi-Cal, beneficiaries must incur a predetermined amount of health care expenses each month before Medi-Cal begins to offer assistance for that month. When the share of cost has been met, Medi-Cal pays for any additional covered expenses for the month. Share of cost requirements are not the same as cost-sharing or copay requirements. Cost-sharing requires a recipient to pay a set amount or percentage of each health care service received while share of cost requires recipients to take full responsibility for health care expenses up to a predetermined amount. Examples of share of cost recipients include those who are eligible through the medically needy program comprised of the aged, blind and disabled people, and those that qualify for the medically indigent program.
      
   3. Uniform fee schedule. The state requires that clients and their families must pay, according to their ability, towards the cost of care that is received from any MHP under the Short-Doyle Act. The client/families ability to pay is assessed according to the plan known as the “Uniform Method of Determining Ability to Pay (UMDAP).”
      

The UMDAP process was developed and implemented in state fiscal year 1972-73 for use by Short-Doyle funded county mental health departments and their contract providers. The former Department of Mental Health established a uniform fee schedule based upon a patient’s monthly adjusted gross family income (MAGFI) and number of dependents. County mental health departments are required to complete a financial screening document on each patient served to determine that patient’s ability to pay and to establish an annual liability for the patient based upon the patient’s MAGFI and number of dependents.

UMDAP now generally applies to individuals who are indigent and Medi-Cal beneficiaries who have a share of cost. UMDAP also applies to non-Medi-Cal services provided to eligible residents, including Medi-Cal beneficiaries. If an individual has private insurance, county mental health departments bill the private insurance. If an individual is enrolled in Medicare, county mental health departments bill Medicare. If an individual is enrolled in Medi-Cal, county mental health departments bill through the Short-Doyle system in order to draw down federal funds; however, individuals who are enrolled in Medi-Cal with a share of cost requirement are subject to UMDAP until the share of cost is met.

• 1. Mental Health Parity. In 1996, the U.S. Congress passed the Mental Health Parity Act (MHPA), which prohibits large group health plans from imposing higher annual or lifetime dollar limits on mental health benefits.  However, the MHPA did not mandate coverage for mental health services and only applied to group health plans that offered mental health benefits.  The MHPA also did not apply to substance use disorders, services limits, limitations on the types of facilities covered, or differences in cost sharing, and plans could have stricter prior authorization requirements for mental health services than for other medical services.

In 1999, California passed AB 88 (Thompson), Chapter 534, Statutes of 1999, which requires a health plan contract or disability insurance policy to provide coverage for the diagnosis and medically necessary services of severe mental illnesses of a person of any age and of serious emotional disturbances of a child.  Benefits must be applied under the same terms and conditions as applied to other medical conditions. AB 88 also requires copayments, deductibles and maximum lifetime benefits to be applied equally to all benefits under the plan.

In 2008, Congress passed the federal Paul Wellstone and Pete Dominici Mental Health Parity and Addiction Equity Act of 2008 (Act) to cover some of the gaps in the MHPA. Similar to the MHPA, the Act only applies to large-group health plans.  However, the Act also included Medicare Advantage plans offered through group health plans, state and local government plans, Medicaid managed care plans, and state Children’s Health Insurance Program plans.  Unlike the MHPA, the Act prohibited differences in service limits, cost-sharing, and in-and-out-of-network coverage, and applied to services for substance use disorders.

The Act requires, if health plans include services for mental health or substance use disorders as part of their benefits, to provide those services under the same terms and conditions as other medical services.  The Act eliminated all differences between mental health and substance use disorder services and other medical services as they related to:  services and visit limits; deductibles; copayments; coinsurance; and, the use of out-of-network providers when a health plan gave this option.  Further, federal regulations in 2010 and then the final rule in 2013, prohibited health plans from imposing a financial requirement or services limit restriction that is more restrictive than what they offered for medical and surgical benefits in the same classification.

This bill is necessary because existing statute currently requires MHPs to charge individuals, including Medi-Cal beneficiaries, a fee for SMHS based upon an individual’s ability to pay. However, managed care plans do not impose any type of financial requirements on beneficiaries for medical/surgical services.

1. SUPPORT. Western Center on Law and Poverty states that this bill is necessary to comply with federal parity regulations.

REGISTERED SUPPORT / OPPOSITION:

Support

Western Center on Law and Poverty

Opposition

None on file.

Analysis Prepared by: Rosielyn Pulmano / HEALTH / (916) 319-2097