Senate Budget and Fiscal Review Subcommittee No. 3 on Health and Human Services

The Senate Budget Subcommittee Number Three on Health and Human Services will come to order. Good morning, everyone. The Senate continues to welcome the public in person and via the teleconference service for public comment. We are holding our Committee hearings here in the 1021 O Street building. I ask all members of the subcommittee to present in room 1200 before we begin our hearing as we begin our first sub three hearing

And it is a complete honor to welcome everyone to the start of our sub three hearings. Our state has been facing an overall social services crisis, whether it be our behavior and mental health crisis, our access or lack thereof, to affordable health care, or a depleted workforce in these sectors. It will be my intent throughout these hearings to dive into how our previous investments have or have not made a difference in addressing these issues.

Given that we are not in the same financial position as we were in the past couple of years, I want to ensure that on top of protecting our progress, we are holding accountable those who were tasked with implementing solutions. We will be hearing budget proposals from four departments and agencies during today's hearing, including the California Health and Human Services Agency, the Department of Healthcare Access Information, the Department of Managed Healthcare, and Covered California. Before we hear presentations on these proposals, we will have an oversight item on the Office of Youth and Community Restoration. Before we now let's establish a quorum. Consultant, please call the roll.

[Roll Call]

Great. Madam Vice Chair, I just gave some remarks. Wanted to see if you had any opening remarks on your end.

No, Madam Chair, I caught the first part of your remarks at my office and the balance of them here, and I think you outlined the committee perfectly. Thank you, ma'am.

Great. Like I mentioned, the first issue on the agenda is an oversight item and panel discussion covering the Office of Youth and Community Restoration back in 2020. The budget included a plan to close the Division of Juvenile Justice, DJJ, at the California Department of Corrections and Rehabilitation and realign the juvenile justice system to the counties, a plan that we all know will better address the needs of this population.

DJJ will close in the next couple of months, permanently on June 30, 2023, and the youth remaining in DJJ will be returned to their home counties, where counties will be responsible for caring for youth with more serious needs. This major transition actually comes at a time when my home country, LA County, is facing a huge crisis in the juvenile justice system.

We've had reports of sexual abuse, physical abuse, and conditions so substandard that the county moved all of the youth in one situation from one juvenile hall to another to avoid a state inspection, creating a dangerous and volatile situation. I do recognize that LA might be in a unique problem and we'll be looking at the whole state, but these are the issues that are front and center.

The work of OYCR in partnership with counties is critical to realizing the vision of the juvenile justice reform in the wake of this major transition. So today we will hear from Judge Katherine Lucero, the director of OYCR, Karen Pank, the executive director of the Chief Probation Officers of California, Frankie Guzman, senior director for youth justice with the National Center for Youth Law, and Jasmine Dellafosse, youth advocate, to participate in this discussion. Thank you, panelists, for being part of this oversight panel. And let's begin with the presentation from Ms. Lucero. Welcome and please proceed.

Thank you. Thank you so much. My assistant will be putting up the PowerPoint. I do want to thank the honorable committee members for an opportunity to share our progress. We were asked to give a brief overview of OYCR and then to answer seven specific questions. As you are well aware, OYCR was created by SB 823 to support the closure of the state youth prison and to promote the developmentally appropriate, trauma-informed care of young people who have committed serious law violations.

Since the first staff were hired about a year ago, OYCR has worked diligently to carry out this mission. OYCR is building out its team and has hired chiefs for the research and data division, the technical assistance division, and the ombudsperson division, among other staff. Of 28 authorized positions, we have filled 14 of those positions. We have 14 vacancies with nine active recruitments.

I and my team meet regularly with broad youth justice community, including young people with lived experience, families, probation, community-based organizations, youth advocates, educators, behavioral health professionals, tribal representatives and tribal court judges, state court judges, defenders, district attorneys, and others. Over the past year, we have had over 200 meetings and more than 34 site visits to the 35 secure youth treatment facilities that have emerged, and we have held three community listening sessions. We are also working within state agencies to break down silos.

For example, we are collaborating with partners across the health agency of which we are located to elevate the resources available and needed that are important to justice-involved youth. I've also requested that the Child Welfare Council create a youth justice standing committee to take over the work of the OYCR Committee when it sunsets on July 1, 2023. It is critical for the needs of the justice system-involved youth to be represented in all our state agency discussions that involve family, children, and youth-serving systems.

With regard to the county plans as described in the background materials in 2022, OYCR requested revisions to plans and approved them all. The plans and OYCR summary of the plans are available on our web page. This year, OYCR is offering technical assistance to counties in developing their plans, particularly around data and outcomes, retaining youth in the juvenile justice system and avoiding transfer to adult court, and culturally honoring program. Plans are due on May 1.

Counties are not required to update their plans this year, but we anticipate that a number of counties will do so as improvements to county programs and facilities continue to be developed as we speak. We must remember that each chief must get sign-off and approval from a myriad of people in county and state government prior to, for example, changing a room constellation, building a new fence that is less institutional, or installing a new temporary building for vocational training, so we expect improvements to continue throughout the next couple of years. OYCR has developed technical assistance briefs to address issues identified at site visits, including briefs on record sealing and on employment and criminal history reporting.

OYCR is developing several other briefs to promote best practices for native youth and for youth involved in both probation and the child welfare systems for youth, typically known as crossover youth. Our TA team is in the middle of following up on numerous TA requests, either direct requests or identified by our staff in the county plans.

I know recently our staff met with one large county who was interested on technical assistance on how to keep more youth in the juvenile justice system and to prevent adult court transfers. I met with the staff recently in order to develop a three-pronged approach that I believe will have value to counties throughout the state. OYCR is also providing UCCI training for probation departments and that was launched last week.

There are 118 total direct two-county technical assistance needs, both requested by counties and identified by county liaisons via the plans and site visits. This does not include presentations that we have given over the last year, nor the informal technical assistance which is delivered immediately after a site visit by helping to introduce, doing virtual introductions, getting contacts to counties, getting them articles, making sure that any need that they had at that site visit was fulfilled.

We have served 42 of the 58 counties and identified the TA for 42 of the 58 counties. Examples of TA topics include placement needs for youth with serious mental illness, connections to resources like the California Conservation Corps and Rising Scholars, CSEC resources, support with the JJRBG County Plan Development, dual status protocols, foster care or PREA ombuds information, step down furlough processes for judges, program outcome measurement and evaluation technical assistance, educational policy research, information on evidence-based practices, as already indicated record sealing protocol,s culturally responsive services, family engagement. California's approach to the care of justice-involved youth is a new approach that does not have a roadmap.

OYCR is leading the way by defining new paradigms and creating projects to establish proof of concept. It's important for us to remember that this is the final realignment piece that actually has been in process for over the last couple of decades. To that end, OYCR has allocated funding available for grants and technical assistance to major projects that support local jurisdictions in developing community-specific programs to care for youth.

For example, OYCR is partnering with the Vera Institute of Justice to support counties in ending the incarceration of girls and gender-expansive youth. For this project, OYCR is allocating $3.5 million, which will go to four selected counties. OYCR anticipates that 1.5 million will be used for probation Administration and leadership of the program and 2 million for program and implementation, including support to community-based organizations that will be crucial in caring for girls and gender-expansive youth.

Applications have been submitted and OYCR anticipates that we will be able to announce the county selected by mid-March. Another area is transitional housing. One of OYCR's key funding strategies focuses on transitioning young people out of the most restrictive settings and getting them progressively back into the community. We are calling this the stepping-home model. OYCR anticipates using approximately 5 million of its grant funds to support implementation of the best practice recommendations it is developing in collaboration with other stakeholders.

Specifically on our CWC OYCR Committee, we have visited several transitional housing sites and met with leaders in the field, both in Sacramento and Los Angeles. We are aware that CDCR has various contracts with DJJ currently to work with groups such as Amity and ARC and are undertaking to see how we can not only do a knowledge transfer, but a resource transfer to keep and build upon the protocols that DJJ was using in the last couple of years, which were proven to be successful.

We are also working to ensure that the $3 million that was authorized under AB 178 to support DJJ youth who are at risk of homelessness can be fully accessed by DJJ youth once they go to the counties and are released from the secure youth treatment facilities. OYCR has also allocated funds in the following areas for projects in development, among others expanding the capacity of community-based organizations $3 million, which is part of the CWC OYCR Committee work building local data collection capacity across systems probation, behavioral health, and education $3.5 million, launching a state level youth advisory committee led by a consultant that we have identified and are bringing on, $500,000, partnering with CPAC to offer probation focused trainings and learning communities at $1 million.

Family engagement grants have been offered to counties and that will be case by case determined by the needs and we are also engaging in a therapeutic facilities contract with an expert to help us and the counties understand how to improve the conditions in their existing facilities. Forward change contract we also have an educational expert called Forward Change which specializes in dismantling the school-to-prison pipeline for youth of color, and they are also helping us with our work on the Child Welfare Committee.

With regard to our ombuds division, our ombuds person started October 24, 2022. The division is operational and receiving and investigating complaints. The deputy ombudsperson started on January 3, 2023. Four liaison positions are currently posted and will cover Southern California, the Bay Area, and Sacramento. Positions close on March 3 and we anticipate that the recruitment process will conclude with final offers by May. Central California will be covered between Southern California and the Bay Area positions. The ombudsperson hotline has been operational since July 2022.

The ombudsperson hotline has had over 100 inbound calls. More than 90 complaints have been made from youth or on their behalf across six counties. Approximately 76 of them are under current investigation and 14 cases have been closed. Our complaints have been initiated on the hotline through emails, through outside contacts with our ombud staff, and by direct observation by our staff at facilities, by the ombud staff at the facilities, and in the community.

With regard to awareness and visibility, our ombudsperson posters were mailed to all secure youth treatment facilities and additional copies are being mailed to all juvenile facilities in the state. We have observed them being posted on our site visit. The ombudsperson is out in the community. She has visited 17 facilities to date, engaged in dozens of meetings with advocates, educators, defense attorneys, district attorneys, judges, the probation oversight commission, community-based organizations, and tribal leaders.

She's also met with probation officers, probation chiefs across the state, and other county officials and made presentations at various conferences. With regard to the youth bill of rights that went into effect January 2023, the ombudsperson is working per statute with youth advocates and community-based organizations, families, and facilities to develop materials explaining the rights of the youth in an age-appropriate manner.

Part of the ombudsperson's visits to juvenile halls and community partners has been to create awareness and education around the youth bill of rights. OYCR is devoting intensive efforts and resources toward making the transition of youth from DJJ to their home counties as smooth as possible. I and my staff personally visited 34 of the 35 facilities where many of the young people are likely to return, so I and my staff could see the facilities that they would be received too.

Our county liaison unit, together with our data and research unit, will be completing a summary report of our visits for lessons learned and to highlight best practices and areas for further TA and areas for further improvement and partnership. OYCR has contracted with the California County Probation Consortium to support counties to provide appropriate care for each and every young person returning from DJJ. With the consortium, OYCR developed technical assistance for courts to bring DJJ back in an orderly manner, taking into account their particular needs.

This was basically an unscripted part of this transition and we worked with the Judicial Council, we worked with DJJ and we worked with the consortium to put out a document that really was a step-by-step suggestion on how to make sure that our kids got back and transitioned smoothly and everything was taken care of so that there could be a roadmap.

Engaging what we learned from site visits and other community sources, OYCR is now working with the consortium to help support appropriate placement and care for a relatively small number of DJJ youth with specialized needs, in particular mental health care needs, gender-responsive needs. This is an intensive case-by-case process and is being undertaken in a highly collaborative manner while protecting the confidentiality of each youth. Individual information is not shared with OYCR, but the circumstances and the request are very particular based on the needs of the youth and the needs of the county.

OYCR and the consortium are identifying critical gaps in care of youth returning from DJJ. This will assist not only the youth returning home but will help counties start to develop long-term solutions for community-based care of youth with serious mental health needs, girls, and gender non-conforming youth.

OYCR will work collaboratively with DJJ leadership and staff to ensure a full knowledge transfer of DJJ's programs and resources so that OYCR can support the implementation of programs that were most successful at DJJ in the counties, such as their youthful sex offender treatment program, and we're working very closely with Dr. Bolts on that. OYCR is also working to address and I think we're on question four.

OYCR is also working to address these issues, both on an immediate timeframe for youth returning from DJJ and for the long term. We have undertaken to hire an expert on how to access and draw down funding and to problem-solve behavioral health gaps that currently exist. Will Lightbourne has joined us and OYCR is partnering with sister departments in Cal HHS to increase access to behavioral health treatment and staff.

OYCR is reserving 2 million to promote newly available CalAIM resources for justice-involved youth, linkages to other health policy solutions, and grants to counties and CBOs to develop capacity within their counties to provide behavioral health treatment via avenues that are identified in the jurisdictions. $1 million was allocated to work with HPI to provide guaranteed income for people with lived experience in the juvenile justice system entering the behavioral health workforce.

Our staff is also sitting on the Complex Care Committee for AB 2083 and reaching out to problem solve with DHCs, DSS, and DJJ on the youth that have been identified with complex needs that are returning to 20 counties by June 30. With regard to the sex behavior treatment modalities, as a member of the California Sex Offender Management Board, CASOMB, I urged that the body develop and adopt guidelines for treating and supervising youth who have committed a sexual offense using a developmentally appropriate approach based on neuroscience.

We are also wanting to hire an expert who can provide specialized TA on this topic to counties, and we have already been in touch with several interested parties. Those guidelines were adopted by CASOMB, and I believe that those guidelines will assist counties in having the confidence to retain youth in the county juvenile system rather than possibly begin filing transfer motions because of a perceived lack of expertise with regard to girls and gender-expansive youth.

As I have already noted, OYCR is partnering with Vera Institute and supporting four counties with the goal of reducing and ending the incarceration of girls. OYCR intends to expand the work across the state after the initial cohort is underway. Some of the counties we have visited have coed programs and or are housing SYTF girls with other girl populations in their facilities and allowing the SYTF youth to program together during the day.

We continue to work with the consortium and DJJ on what counties need to accommodate the girls and are ready to identify solutions and resources with either our funding currently or through other funding streams within the agency. County probation departments are focused on developing secure youth treatment facilities able to care for youth for longer periods of time. SYTFs are a new type of category for a facility that counties have not previously had to provide possibly multiyear custodial settings post-adjudication.

County probation departments are working to develop environments, programs, and services that are developmentally appropriate and trauma-informed and take into account young people with longer sentences in these existing facilities. At the same time, counties are developing resources to get young people out of the most restrictive setting as quickly as possible through step-downs or what we are calling the stepping home model. We have seen various approaches to stepping home. Several SYTF youth have been stepped home with GPS monitoring where they will continue their court commitment.

Several counties are working on transitional housing resources to assist with both stepping home and re-entry. The California Conservation Corps has nine residential facilities throughout California and is able and willing to receive secure youth treatment facility youth and the youth can also go to Pine Grove. Assisting counties in building out these community-based alternatives is a major priority of OYCR.

While many young people returning from DJJ are going into SYTFs, OYCR is aware that some judges are also returning youth to community-based programming such as Pine Grove and the California Conservation Corps after a remote hearing and not placing youth in the local SYTF at all. There are not yet juvenile facility regulations for SYTFs. I am chairing the Juvenile Regulations Revisions Executive Steering Committee Subcommittee on the SYTF regulations, which is charged with developing minimum standards for these new treatment facilities.

In question six, counties should remain youth-centered in seeking to balance regional approaches with bringing young people home. We have heard young people in facilities talk about the positive impact of being closer to home and the increased ability to make connections with their families because they are nearby. However, the needs of individual youth must also be taken into account.

Not all counties have the same type of programming and there may be cases where a certain young person would desire a particular program or course offered by another county or where they have specialized treatment needs. Small counties may not have the numbers of young people necessary for a viable program. To the extent that young people are cared for far from home, OYCR seeks to support counties in maintaining positive family engagement.

OYCR has offered family engagement grants to support families who would not otherwise be able to visit their children housed in other counties in rural counties, for example. In our discussions with counties, we are asking that for youth housed in regional facilities that the county plan be especially detailed and thoughtful around the topic of family engagement and reentry. We are also aware that certain young people who do not feel safe in their own communities would prefer to reenter in a different locality.

These needs and preferences should be honored. The numbers of incarcerated young people have declined so substantially that we believe that the counties can and will and want to consider the individual youth needs. The key principle is to support the young person's positive youth development and prepare the path for reentry for any youth who has been held in custody.

And the last question, one of OYCR's highest priorities is defining the role of community-based alternatives to incarceration in the continuum of care for justice-involved youth and expanding availability of community-based options. We are doing this through multiple approaches, notably, as already mentioned, the Vera Institute. Also the stepping home model. That work is being led by consultants with UCLA and Will Lightbourne, our senior special consultant. Many county probation departments either have already begun building out the stepping home continuum or in the planning process.

For example, some probation departments are preparing housing on their footprint that will be managed by community-based organizations and serve as transitional housing for young people ready to start the stepping home and reentry. Several counties have sent young people home on GPS, as mentioned earlier, and several counties are exploring contracting with supporting housing resources in their communities. Apart from those already mentioned, one exceptional resource for the continuum in California is higher education.

Seeing the educational health of our youth who are incarcerated is critical to the whole-child approach. Partnerships between California institutions of higher education and justice systems involved people have demonstrated remarkable success both in terms of traditional metrics such as recidivism, but also in terms of positive outcomes. Project Rebound, Rising Scholars, and Underground Scholars are all powerful programs that can not only provide access to education, but supportive services within and outside the juvenile facilities.

Rising Scholars, the California Community College's Chancellor's program, is the first program in the nation to focus on offering higher ed resources to justice-impacted youth. Rising Scholars now has $15 million to support the development of 45 new campuses focused specifically on justice system-involved youth. OYCR is partnering with the Community College's Chancellor's Office, probation county offices of education, and others to promote this expansion of rising scholars, and we have had a multitude of welcoming on this topic from the counties that we have visited.

My hope is that each secure youth treatment facility will actually be a Rising Scholars location, and I know that that's the hope of the professionals that we have worked with. Rising Scholars provides not only higher education courses and educational counseling within juvenile facilities but also transition support, including housing resources.

We see an important partner in education and vocational training in the Department of Rehabilitation to expand resources for our youth that will carry the youth during this reentry period towards a living wage long after they leave county custody. OYCR believes that this is a powerful piece of the stepping home model and a powerful model for the nation, and we'll continue to focus on this as part of our charge is to provide that technical assistance for positive whole-child youth development. Thank you. That concludes my presentation. And I'm available for questions of course.

Perfect. We'll wait for questions till the end after all the panelists. Thank you so much. Now we're going to turn over to Karen Pank, executive director of the Chief Probation Officers of California.

Thank you. Good morning. My name is Karen Pank. I am the Executive Director of the chief probation officers of California. I thank you for the invitation to present today. I've been asked to give a historical perspective of leading up to the closure of DJJ probation's implementation efforts around SB 823.

And some of the challenges we face with the impending DJJ closure happening in just a few know, it's very difficult to give a short or a brief kind of retrospective of the evolution of juvenile justice in California the past couple of decades. A lot has taken place under the leadership of where California really wanted to take. Some of the things that you're seeing now culminate in 823 and some of the things that Director Lucero just discussed.

But really, as she mentioned, the past couple of decades is where we first started to see investments in this new response to juveniles in our care, and we saw the Schiff-Cardenas Crime Prevention act in 2000 being really kind of the beginning of that response, and the build out to invest in juvenile probation and to look for ways to focus on prevention interventions and improved supervision, and so that touched off a lot of these different changes in our field.

And these investments really helped usher in an era where probation started to use things like the risk needs responsivity principles to try to target services to the highest risk youth, and at the same time, divert or deflect the lowest risk youth from the system. Some of this was in response to growing concerns around sending youth to the state, or getting deeper into the system and wanting to build out more of those interventions locally. So, these things continued to evolve,

and in 2007, we see the first major statutory shift in SB 81, the adoption, I should tell you of SB 81, which made certain felonies ineligible for youth to be sent to the state. And that legislation also provided support for probation in counties to further address some of the gaps in their systems in order to take on this new responsibility. So really what this did is leave the most serious felonies eligible for state placement.

And that was really things such as higher risk sex offenses, aggravated assaults, murder, things along those lines. While youth didn't have to go to the state, if the counties and the court felt that they could address that locally, they certainly did in many cases. But where the more complex need arose, where the state could address that, those were the youth that you saw continuing on to the state care, continuing on the history, you really see something that I know this committee is very familiar with.

In 2015, the Continuum of Care Reform was adopted, and mandating child and family teaming and phasing out group homes. Probation really took a lot of lessons learned in that arena and helped build upon that to prepare for again some of the things that we're seeing today. In 2016, Prop 57 passed that, among other things, also ended the direct filing of juveniles to adult court. And that certainly had a significant impact on the landscape of juvenile justice and continued, really in this vein.

Nearly 90% of all youth in the juvenile justice system are safely supervised and treated in our communities, and detention rates continue to go down from our historic highs at both the state and the local level. So how did we achieve some of these changes, the innovations in the California juvenile justice systems? Several. Several things we don't have time to probably dive into today. But just a few highlights, really, a lot of alternatives to prosecution. Things such as diversion became something that permeated the landscape.

A lot of new efforts in the racial and ethnic disparity, investments in that area as well. A mental health service focus became much more important as the level of acute needs in our detention facilities began to be kind of all in one area. And so that need was really becoming laser focused. Case planning, where we really are looking at the individualized needs of that youth, was becoming more and more part of the culture.

And of course, the trauma informed care, our family focused process, you really started to see that again permeate the profession and is reflected in a lot of the treatment plans that are being reviewed today at OICR. So that's really just a quick, high level overview of the environment, of what we kind of have at our disposal as we are overlaying the implementation of SB 823. So what do we know about the population in the first year of implementation? Just a few highlights.

As was noted, the secure youth treatment facilities are the kind of replacement option for courts to consider now when a youth comes before them that they may have previously sent to DJJ. The average baseline term that we're seeing in that first year was at four years, the longest being 7.6, the shortest being 18 months. We saw about 229 youth locally receive this commitment. That's compared to DJJ in 2019, which saw about 334 commitments.

Again, all of these commitments really do reflect kind of that higher level need and risk, while a small number, and that's a good thing, is also very much in need of a lot of resources and a lot of support. And so you'll see a lot of that in the treatment plans. A couple of other things to note about the local juvenile justice continuum.

As was noted, I think, at the opening comments, Senator, we have 58 different counties, all in very different places and having different resources available to them, but just at a real high level. We have 41 counties that are operating juvenile halls. We have about 27 counties that have camps or ranches as an option. And about 35 counties have designated facility or a part of their facility for the new secure youth treatment facility.

So what do we know about the plans that were required to go to OICR in the state as we started kind of building out the continuum to be prepared to take on this new responsibility, it's, as you can imagine, very vast, 58 different counties. But we do have a couple of different kind of common themes that we wanted to point out today to just give you a sense of how counties are addressing these things.

You do have kind of three buckets of counties where one will be able to expand, maybe their current continuum to develop a secure youth treatment facility option within their county. Some can do that, but probably cannot develop enough of the various different specialized programs that we're decentralizing from DJJ in all cases. So they may want to partner with a surrounding county if they have a specialized need that cannot be taken care of in the current facilities that they have.

And then finally, as pointed out, we have several counties that will not have any facility or a facility that just is not appropriate for the need that arises with a particular use. So those are kind of the three buckets that we have to find ways to address as to the treatment and the types of things that the counties are working on building into their continuums. You really saw a lot of those plans.

Talk about that trauma informed and culturally competent responses that, again, you saw kind of evolve throughout that history. The emphasis on positive youth development was already mentioned. The use of positive incentives. Those are the types of things that I can tell you, our folks are spending a significant amount of time trying to ensure they have the tools and resources available to do that.

Continuing to look at strategies to fund mental health and substance use disorder, and I certainly would say in this committee in particular, finding ways in which we can leverage where those funding streams are. I think Director Lucero mentioned that in her comments as well, is certainly an area that was noted in a lot of the treatment plans as things that we need to invest more in and look to find ways to bring those into the facilities.

The other thing that showed up in these plans, which I think is particularly of important note for this committee, is the multidisciplinary team approach that, again, we saw as a common thread in a lot of these plans. And interestingly, I think it's good to know that they are really looking at it from both the intake part of the process and building it out through and following it through to reentry. And why is that important for this committee?

I think the connection to the Cali implementation we're going to want to really look at carefully is how that overlays in some of the efforts that are ongoing right now, expanding the partnerships on reentry and transition. Again, something that Director Lucero mentioned, something that's so important with this particular population, as it's just mentioned, these are longer stays, this is becoming an older population. We really need to be looking at how we are setting them up for success after they leave our jurisdiction.

And we really need to be partnering with other community based organizations as well as system partners to help ensure that the reentry is successful. And then finally, a lot of discussion around how we develop specialized programming, because again, as we are losing the state option where it was mainly used for that very high level need, how are we going to be looking to replace that locally?

CPOC, our organization has really tried to help coordinate some of the county level conversations because we really are talking about this being an aggressive timeline to do all of this and to do it successfully.

So we are in weekly implementation calls with our departments and their leads on all of this to try to ensure that we're sharing information, sharing the things that, a lot of the things that Director Lucero spoke of earlier, offering informational workshops throughout our profession, again linking them to the statewide tools and resources that you're all trying to make available. Participating in this gap analysis, which I think will be really important for this committee and others to be looking at.

How do we fill those gaps to make this successful long term developing training modules. There's nothing more important, I think, from our organization's perspective than to try to help in that area ensure that our staff and those who work with our youth have as much of the tools available. Training is a wonderful way in which to overcome a lot of the hurdles that I know will exist in some of this implementation and of course, our collaboration with many of the state partners, as was earlier mentioned.

But what are some of the challenges? There are many, and we hope to continue to partner with the state and others in trying to fill those, some of the common challenges that have already come through the planning process, reentry planning as noted before, that transitional housing and the workforce development.

That's really something that we are hearing as we also interview a lot of the youth that are returning from DJJ as well as those who are coming into our system from the local perspective, that workforce development is going to be an important piece to this successful launch. The specialized programming I've mentioned, I cannot probably mention it enough as a challenge ahead for all of us,

and then potential the longer stays for that transitional age youth, specifically, as they get older in our care, we need to be sure that we're finding ways to kind of matriculate them through the system as quickly, as safely, and as successfully as possible back into our communities.

The post secondary education, as Director Lucero noted, we're very involved in a lot of those things, such as the Rising Scholars, because that's probably one of the top things noted in a lot of the plans as a gap that needed to be immediately looked at with this new older population. As an example, in January there were still about 400 young adults at DJJ.

And at that time, the average age estimated at the time of closure, which we'll be seeing in a couple of months from now, is estimated to be 21 years old. So that is a significant change for us at the local level. The 823 implementation, I think you are aware that ultimately our organization, probation professionals across the state, opposed the policy.

The aggressive timeline was a concern, as well as some of the unintended consequences for the youth that we are all now trying very hard to make sure does not happen. And once it became law, I think you saw probation departments kind of get into action, make sure that we were working through this policy to make sure that we're collaborating with all who would be involved, because it was going to take everyone to try and immediately work on ways in which to make this successful.

Many of the concerns that we raised at the time of the passage really still do remain true today. And so as we look at transitioning the very last piece, the DJJ young adults, back into our care, we really need to again make sure any system change meets the core tenet of not destabilizing the youth that are currently in our system. We must be able to tailor programs, services, capacity, and delivery methods that match the needs of the complex youth that you intend for us to serve.

We must account for the counties that do not have capacity or the appropriate capacity for this older, more complex and higher risk group, and we must create a system that our partners, especially courts, have the confidence in, so more youth are not lost to being transferred to the adult court jurisdiction. I think all of us are in agreement that that should be a top priority.

So when you think about it, as the state is decentralizing a very highly specialized, complex piece of this system, we must support and recognize this is being done, as I said, under an aggressive timeline, while we're facing labor shortages at different areas at the local level, we ultimately need to add that specialized programming for very small number of those complex youth in order to be successful with them.

And we're looking at doing that now in several jurisdictions versus just the one centralized source when it was at DJJ. So the trade off of getting youth back closer to home, which we all support, has that challenge with it in trying to figure out how we replicate a lot of those programs. So where do we go from here?

In closing, I just want to be sure to note that probation has a long history of supporting many of these reforms that we talked about at the top of my comments and successfully collaborating on the implementation of very complex policies. So what we know for certain is, without immediately working towards addressing the gaps in the system that we've previously, and continue to identify, the youth that the court places in our care will not realize the promise of this reform, and that would be the ultimate tragedy.

We specifically want to be sure that we can ensure that these youth have a more successful outcome than they previously did before the reform. So the specific things that this will include, but not limited to, and some of this has been already referred to, but we need specialized, regional, secure programs, both in the behavioral health space, sexual behavior treatment, and female specific focus programs. We need to really look at funding and emerging needs that arise from the DJJ youth transferring mid program.

Remember, these youth are still in the middle of their programming at DJJ. That's why they're there. They haven't been deemed ready for parole, and so we don't want to destabilize what they are in the process of doing. But we may not have, depending on where they're coming home to, all of the same things in place. And so how do we quickly close that gap?

Those things might be hard to identify, and so having a pot of funding that counties might be able to go and get some emergency relief from would be, I think, of great benefit to the counties as they are trying to bring back home this population. Ultimately, we also need, both in the emergent, but also in the long term, access to high level mental health treatment beds for youth, such as the ones that exist at dish, which I believe is what DJJ was utilizing.

We need the expansion of funding for the least restrictive programs. Remember, that average length of stay is much longer. That's not ideal. So we need to be focused on ways of matriculating these young people through a continuum that sets them up for success upon reentry. And, of course, funding for transitional housing, as has been previously mentioned, is desperately needed for this population once they leave our jurisdiction. So there is a lot to cover in a very small period of time.

I'm more than happy to answer any other questions, but I thank you for your time and listening to some of our points today.

Really appreciate it. Thank you so much. Please stick around for questions after. Next up is Frankie Guzman. He's a senior Director for youth justice with the National Center for Youth Law. Welcome, Frankie.

Thank you. Good morning, Subcommitee. Thank you for inviting me to present today. My name is Frankie Guzman. I'm the senior Director of Youth Justice at the National Center for Youth Law. I come before you today as a formerly incarcerated youth who served six years in California's youth justice system, including five years in the Division of Juvenile Justice, and as an attorney who worked with the Legislature to draft and pass Senate Bill 823.

The purpose of this law is to close California's youth prison system, realign the state juvenile justice system to the counties, and to establish the Office of Youth and Community Restoration to oversee the newly decentralized youth system with a health focus.

The intent is to shift away from our outdated and harmful correctional approach to imprisoning kids in favor of keeping all DJJ eligible youth in their home communities, housed in the least restrictive, appropriate environments and served with developmentally appropriate, trauma informed and culturally rooted services proven effective at promoting positive youth development and increasing public safety. Unfortunately, due to fierce opposition from probation and county leaders, the early indicators are bleak for many of the first DJJ youth who have been returned to the counties.

SB 823 has resulted in little more than moving children's bodies from medium security state youth prisons to maximum security county juvenile halls with poor programming, inadequate education, little community input and state oversight, and no local accountability for how state funds are used and how incarcerated youth are treated. To be honest, we are not implementing SB 823 with fidelity to its core intent, and we are failing our youth.

For example, under the law, each county must establish a JJCC Subcommitee composed of county administrators, youth development experts and community stakeholders to develop county plans detailing how realignment funds will be used to serve realigned youth locally in accordance with the law.

Frankie, I'm so sorry. Is there any way you can turn on your video? Your camera?

I apologize. Thank you so much for letting me know. However, in far too many counties, probation and county officials have developed their plans without youth development and community stakeholder input, and as a result, most counties have designated their juvenile halls as secure youth treatment facilities, or SYTFs, in which to imprison DJJ eligible youth. By design, juvenile halls are maximum security, short term detention jails. Lacking adequate education, health care, recreation and family visiting spaces, juvenile halls are not trauma informed they are inherently harmful to children.

In fact, many youth who have returned from DJJ to county SYTFs have reported deplorable conditions with inadequate programs, few opportunities for recreation and family visits, and a punitive correctional culture. Some have even asked to return to DJJ or be sent to prison instead. One of the core components of the legislation is the ability of courts to transfer youth from SYTF to a less restrictive program, or LRP, to serve their baseline confinement time.

Locally, there is confusion about what can function as an LRP and too little attention is placed on ensuring courts are aware of the supportive community options available that can serve as least restrictive placements. Disgracefully, many counties are now developing less restrictive programs within juvenile halls and are simply moving youth in SYTFs to a different unit in the same jail. Sadly, the culture of probation continues to be punitive and harmful to youth and their communities who deserve better.

In the last few months alone, there have been numerous news accounts of youth being physically and sexually abused by probation officials while in juvenile halls in Los Angeles, Santa Clara, and San Mateo counties, to name a few. Also concerning is we are hearing from probation chiefs and defense attorneys that there are many more youth being committed to local SYTFs than were previously being committed to DJJ.

This means more children are being imprisoned in short term detention jails than before, and the state is going backward instead of forward. Unfortunately, neither probation departments nor courts are required to collect data about youth being committed to local, secure youth treatment facilities, and there is no requirement that data be reported to the state or to the public. As such, there's no available data to allow state officials to identify systemic issues and to develop solutions.

Without this information, the state lacks the most important tool needed to ensure success of this transition. Fortunately, SB 823 created the Office of Youth and Community Restoration and the Office of the Ombudsperson to oversee local juvenile justice systems.

However, to effectively shift our juvenile system towards a health based system that promotes positive youth development and public safety, these state agencies need greater authority to inspect and regulate local facilities and practices, greater discretion over state juvenile justice funding to counties, and reporting to the Legislature regarding grievances made from incarcerated youth, family members and staff about rights violations happening to our most vulnerable youth hidden away in locked facilities. With the enactment of SB 823, California chose to do the right thing by its youth.

It made a commitment to young people, their families and communities. We're going to use health centered, research based, positive youth development practices to help young people grow and thrive. Realigning the state's juvenile justice system is a huge shift, and there is no question that changing the system, the culture and the power that's behind it is a difficult task.

However, we're getting early warning signs that it's not going well, and we must make sure that we're paying attention and making necessary corrections for the sake of our children and our communities. Thank you.

Thank you, Frankie. Our final panelist is going to be Jasmine De Lafaze, youth advocate. Thank you and welcome.

Thank you so much. Good morning, Chair and see Members of the Senate Committee my name is Jasmine Dellafosse. I'm a youth advocate and member also of California Alliance for Youth and Community Justice, CAYCJ. And over the past decade, I've been committed to advocating for youth and ensuring that they have access to resources and support they need to thrive and heal.

I've been asked today to share what advocates and youth have been hearing and sharing what changes and progresses have been made towards the continuum and to further ensure the intent of SB 823. And so today I'm here as a youth advocate who has personal experience working directly with current and former youth and DJJ. I've witnessed firsthand the harsh realities that many of California youth are facing.

As an advocate, I've traveled up and down the state supporting and advocating for youth returning from DJJ to their local juvenile hall facilities and ensuring that they have the proper support to navigate a system that in many ways continue to harm them. I've worked with DJJ youth who are returning back to their counties all across California, including counties like Orange County, LA County, Kern, Sacramento, San Joaquin, Monterey, Alameda, Merced, Santa Clara, to name a few.

While we've heard that the roadmaps have been developed, youth and defenders have not been informed to be kept in the loop about these transitions or future plans. Youth are leaving youth in disarray. The extent of the traumatic stories and youth experiences in these facilities are devastating and could take several hours for me to share. But I understand we don't have enough time for this today.

Today, over 300 and plus youth in DJJ and hundreds in juvenile halls across this state are calling on each of you to prove that their lives matter and that they're worth investing in. We've heard from many county juvenile defenders and young people themselves that more youth are being committed to secure youth treatment facilities than were committed to DJJ the year before. Net widening is already taking place and there is no public available data.

The intent and purpose of SB 823 was California's opportunity to be the California Golden State we talk about, to invest in healing based approaches. The use of these juvenile halls secure you treatment facilities are not trauma informed and we understand and know currently that the vast majority of these counties using juvenile halls as the secure youth treatment facilities were built for temporary housing and young people pending court and are proven to cause physical and psychological and emotional harm to young people.

It's important to reiterate that the California Conservation Corps and Pine Groves are not community based alternatives to step downs or housing options, and we should be reevaluating what we are naming community based alternatives and it's at odds with the intent of SB 823. SB 823 was supposed to mark a shift of the state's current investment in corrections towards investments in health and youth development approaches to youth accountability.

However, we're seeing that what young people are unfortunately experiencing in counties and juvenile halls in these SYTFs and facilities are extremely harmful for young people and especially those who are there for long term stays. The situations are so dire that some counties seriously think that they can gaslight everyone by also referring to juvenile halls within juvenile hall facilities as step downs.

It's unacceptable and the Legislature needs to pay close attention to how these types of practices and counties practices done by county probation departments and need to recognize the opportunity to engage with community and stakeholders about alternatives to less restrictive. Young people are sharing that the conditions in juvenile halls, like many in LA, are horrible and as we all know, the ongoing crisis in LA, there are extremely unsafe conditions. It requires immediate attention from the state to improve the importance of why an ombuds person is important.

The conditions in LA are beyond shameful. Incarcerated youth, if they had the opportunity to call in today, I can imagine what they would have to say to share a few of the allegations that are hard to hear but need to be shared. Youth are not being granted the dignity of privacy to use a restroom and being forced to urinate in towels. Youth protesting so they can be in treatment, getting programming to get educations they're entitled to.

These youth should be commended for standing up for their rights, but instead they are being punished. I personally know youth who have also asked to go back to DJJ because of the terrible conditions and recently outlined in the CJCJ report, which I encourage you all to read. Youth say that it's a lot better than the conditions they're facing in their local juvenile halls.

And of course, we have seen in the news recently youth being physically and sexually assaulted by the very staff who were supposed to protect them. I want to express and expand on OICR, OICR needs more authority over funding, over facilities and over programs. Additionally, we need to reinforce and strengthen the role of the ombudsperson to report on grievances and systemic problems to translate into policy solutions in order to ensure safeguards for our young people.

The new Office of The Ombudspersons plays a critical role in shining light on the rampant violations and mistreatment within these halls, but unfortunately, under the current law, it needs 48 hours notice for them to talk to a young person. The state Legislator should be requesting for reports from the ombudsperson to find out more of what kind of systemic issues need to be addressed through legislative change to shift to another issue. I've seen a lack in data collection and accessibility.

There's no systemic approach by probation in most counties to collect data necessary to understand the issues or possible solutions many counties are experiencing, and they're given an excuse about not having enough support to collect this data or expenses. However, counties like Orange County have demonstrated that they can to collect data with these existing resources, so there should be no excuse for the lack of data given the resources that are going to counties, including the $100 million recently given to probation to improve facilities.

Advocates and youth feel this money was wasted on more of the same instead of going towards funding needed youth development informed continuum of care again, SB 823 was supposed to mark the shift of the state's current county infections from corrections towards investment in health and youth development. This body needs to invest in lesser restrictive programs to have fewer broad options. Counties have broader options for California, so we have the resources to do so. Lastly, it is unclear how programming is being evaluated in each county.

JJCC Members in various counties reported that basic program information, such as the number of youth being served, doesn't help when the realignment block ran under AB 505 includes no requirements or accountability measures over this funding. In terms of community involvement, probation in many counties serves as a gatekeeper and controls the process for community input and participation. In many counties, that means that the process does not include community health professionals or youth development experts. This leads to few programs being inconsistently offered.

Around counties, young people report several gaps in programming. For example, programming that is trauma informed and rooted in youth development are scarce to nonexistent and also programming related to gang and culturally competent programming, education plans, vocation and employment treatments are also not clear or being well resourced. Today we laid out a lot, but what I encourage this body to walk away more than anything is to please continue to center the healing and wellness above all else for young people.

And OICR has more authority to ensure these safeguards and healing based, lesser restrictive alternatives are in place. Thank you for my time.

Thank you to all the panelists for your presentations today. And before I kick off any questions to our Subcommitee Members, I want to see if LAO has any comment.

Good morning. Ryan Miller, Legislative Analyst Office we have nothing to add at this time, but we're available for questions.

Great. Thank you so much, Ryan. What about the Department of Finance?

Good morning. Department of Finance. Nothing further to add.

Perfect. Ok. I'll kick off with some questions and then turn it over to my colleagues to my right should they have any questions themselves. I'll start off related to my comments before we kicked off this presentation. Being the Senator within LA County, I want to turn to Director Pank.

And you alluded to, I mean, you mentioned some staffing shortages and one of, in my district, I have a juvenile hall, it's the Nidorf Hall, and it's seeing one of the largest amounts of know due to sick time and not really meeting the ratio of having personnel there. I just wanted to see if you could speak to a little bit more of that and what we're doing related to the crises we're seeing in LA juvenile facilities. How can we expect these conditions to be safe?

How can we expect these conditions to be safe? And if you have right now the number of the eligible DJJ youth that would be entering LA County.

Thank you, Senator, for the question. I do not have the number with me, but I know we have access to that, so be happy to get that to your office. And as it relates to the staffing shortages, I think the question is helpful because it will also allow me to differentiate it a little bit. We're not seeing the same kind of the same problem that we're hearing in LA reflect the staffing shortages that I am mentioning with other counties.

I think that's from a hiring perspective that we know that we're having difficulty potentially filling different positions. We've heard a lot about the behavioral health crisis as well from a position. So it's not really just in the probation ranks, but it's certainly kind of from local government perspective entirely. I think they're just recruitment, and in some cases, retention continues to be an issue that we're keeping our eyes on.

But it's very different than as I understand, what may be happening in LA as it relates to the specific issues LA is looking at. I mean, our reports are that they are very concerned about the number of youth that are returning from DJJ and how to bring that into the current situation. But as it relates to specifically the LA plans, I would defer to the LA probation Department.

Thank you. I'll definitely reach out. My next question is to Director Lucero. You mentioned a couple of positions that you'll be hiring. I know you mentioned the ombuds person that's building their team and so forth, but you talked about positions related to experts. Are these positions that you have the capacity and funding to onboard, or is this going to be something that you're looking to get budget on?

We do have the ability to hire consultants. I think that what is a little bit more challenging is when we want to hire within state government and have folks come over from other special departments and where we might need to get involved in a process for getting those positions approved. But we are working diligently with our leadership and believe that we are going to be able to get what we need on board. And hopefully prior to the closure.

And, Madam Chair, I did want to let you know that our information is that there are 90 kids as of December 2022 that will be leaving DJJ to LA. But some of them may have discharge dates prior to the June 30. But that's the latest information we have.

Thank you so much. I now turn, before I go into any other questions to any of my Subcommitee Members. For questions, I'll start with the. Senator Roth.

Thank you, Madam Chair. Clearly, we're moving very quickly toward the end of this DJJ realignment transition, and I first want to commend the Administration and those involved with it in this very important work. My question relates to question number four on page seven of the analysis, the agenda, the backgrounder, and it's this.

Given the shortages in behavioral health providers at the county level and across the state in managed health care plans, in county employment and otherwise, and given the proposed budget actions deferring money targeted toward behavioral health workforce expansion, I guess my question is what are the specific plans to deal with a lack of providers who need to be providing behavioral health care to those who we are transitioning?

Frankly, I'm concerned that simply providing money to counties through grant programs is not going to address the problem at all because I'm not sure that it's hiring and recruiting. I think it's supply that's the issue here. I don't know who to direct that to. I don't have an agenda with your names, but perhaps someone has an answer you could jump in.

Thank you. Senator, this is Katherine Lucero. You're absolutely correct that we have had counties let us know that it's not for want of ability to hire, but it is because of a lack of professionals that can come into the work. We are being as creative as we can with regard to thinking about telehealth, about regional solutions, about sharing, about teams going to counties versus counties having to pull in teams. We are working with agency for problem solving.

As I indicated, we are dedicating some of our funding through HKAI to help incentivize people with lived experience going into the profession. That is obviously going to be a longer range plan, but we are doing what we can to look at making the best of the situation using the telehealth solutions, using maybe looking at teams, as I said, going to the counties versus counties hiring the teams. And there's a lot of discussions on this point.

I realize that may not be satisfying answers, but I want you to know that this is top of mind. And with regard to placement for kids with the serious mental health issues, we are also working. Well, Lightborne is working with DSS and other agency partners because we are being told that there are often beds, but those beds are not favorably offered to this population with youth with serious mental health illness. So we're trying to problem solve that problem as well.

Well, let me just say this. As we're working through this budget, we do both money and policy, it seems, in the budget most of the time. So as we're deferring budgetary items that deal with the expansion of the behavioral health workforce pipeline.

If there are policy issues and policy changes that we need to make in order to facilitate the use of telehealth, in order to facilitate the use of Cross County teams, behavior health teams, whatever the solution is, whether it's a band aid, temporary or permanent, I think we need to be thinking through that. So appreciate your help as we move forward with this process. Thank you very much. Thank you, Madam Chair.

Thank you. Next, Senator Eggman, do you have some questions?

Thank you very much. And I apologize I wasn't here for the earlier part of your presentation, and also my apologies. I'm going to have to leave before we're done today. And I don't know that I have a question, but I just wanted to make the comment, and I don't know if anybody wants to respond to it. And I saw somebody from my community on there. Nice to see you, Jasmine. But that we're on track to close all of our facilities July.

And I know in my own home community we had two youth facilities. We're down to one currently DJJ facility, but I know in that facility I've visited many times, and it always appeared to me that good work was happening. And in fact, I had many of my students who are professionals, behavioral health professionals, people of color, people with access to different languages. And I know I have heard loud and clear from my county that they don't have good options right now for youth.

And youth are ending up, and as people said, in juvenile detention centers, in social workers offices, in all kinds of places, because there aren't good options for placements.

So I just want to make the point that if we are too aggressive in our timeline, I think the safety and the outcome for our youth and really giving them every shot they need to be successful is what we should have as our priority, rather than just a rush to try to devolve a system that may have some benefits to it, especially in the light of not having appropriate resources through other avenues.

So I don't know if any of the respondents want to respond to that or just are we going too fast? Do we have everything in place to ensure the safety of these youth and actually providing them the services they need to be able to live successful lives?

Senator, this is Karen Pank, Executive Director of the Chief Probation Officers of California. And I would agree that your statement is probably the foundation of the takeaway that I think we would want to underscore today for my membership, as noted. And it was very odd for us to actually be in an opposition to this kind of a policy, because the goals of the policy are very much supported by our profession.

It is the aggressive timeline and some of the way in which we might be looking at the closure, because, remember, it was in twofold. Right.

First, we stopped intake, and so it allowed kind of counties to slowly be taking on new populations with potentially new issues, or maybe some that have similar issues. And so from a county's perspective, it was much more manageable, I would say. And now you're overlaying a new population that is in the process of midway in their treatment plan, have been living in a very different situation.

And so when you kind of take all of those pieces together, including what Senator Roth just mentioned with the behavioral health pipeline, totally agree about the supply, it does create challenges. Again, probation has been willing and able to try and take on some of these complex issues and work with many of the stakeholders and policymakers to try to find some of those solutions. But this has been a particularly challenging one.

And just through the chair, just to make the point, again, just to be on the record saying, if the timeline is too aggressive, no matter how much we agree with the values of the initiative, then I think we should make sure our priority is providing the level of care that youth need.

Senator Eggman, if I may, also, Frankie Guzman with the National Center for Youth Law. And I will agree.

I, too, was not a strong supporter of the governor's plan to close DJJ according to timeline and with no plan, and worked with the Legislature to try to slow things down and really close DJJ the right way by providing the resources in the right places across the state to serve young people in ways, as we've said many times, trauma informed, culturally rooted, and all these other things that are evidence based.

But the truth is, while the timeline is much too aggressive, I think the view taken by many of the administrators is much too narrow in terms of what our available options are, because if we're saying that there aren't enough correctional health based professionals, well, the problem is, it's a bit of an oxymoron. You can't produce health in a correctional environment, and there are going to be very few people available to do that because it is ineffective.

And there just isn't a lot of people signing up to do things that are ineffective, I would imagine. But to the extent that there are treatment providers, behavioral health providers, there are many. The issue is that we've enlisted the probation agencies, leaders to run this new program. Our agenda, which is health based juvenile justice systems and oftentimes I think they dismiss or view community based program service providers with distrust.

And so what I'm saying is that there are many people out in the community who can step up and do a lot of this work. But the partnerships are not happening because the people who we've enlisted to roll out this new realignment program, I think are coming at this from a correctional law enforcement perspective that views community based providers with distrust or doesn't validate them at all. But I would argue that there are many people. I myself spent six years in youth authority.

I came out with a lot more issues than I went in with, and I turned my life around and became successful, not because a clinician in a jail helped me, but because community based providers, credible messengers, and other behavioral health specialists in the community and at community colleges helped me to do this.

And so I would just encourage us to really think critically about empowering health based professionals and listening to them, even if what they say is we cannot help young people in juvenile halls, we must have least restrictive options and abandon this, I would say, unwarranted fear of young people, youth of color, in favor of health based approaches that are proven effective for young people and begin to truly partner with community based providers and also view where our investments are going.

Know CPOC has mentioned a consortium, as did Director Lucero, which, as I understand, know this nonprofit established by elected officials locally, which are using realignment block grant funds, public dollars to create a private nonprofit that is not accountable to community or state oversight and are, in some ways, I would say, serving as an intermediary between county administrators and state officials in ways that I think the Legislature should take a closer look at, because this is the state's business.

And if funds are being used in a way that might create a conflict of interest, meaning chiefs of probation are voting to create the consortium. They're on the Board of Supervisors and are using public dollars in this way. I think that the state should maybe have a greater role in understanding what exactly the consortium is, how funds, state funds are being used, and what the activities are and to what benefit for our young people and our taxpayers.

Senator Eggman, I just wanted to let you know that we're hearing you loud and clear, and also my co panelists, I think, bring up some very valid points around credible messengers and that kind of thing. We will continue to work on this issue with both counties and with advocates, and we are happy to continue this evolving dialogue with the Legislature as well.

Great. Thank you. I no longer have any questions. I really appreciate Frankie diving further more what do we need to envision this reality? Or what do we need to do now in anticipation of this closure? So I really appreciate the presenters from OICR advocates from CPAC in participating in this oversight hearing. We will now move on to hearing budget proposals from the California Health and Human Services Agency.

Good morning Chair and Members, my name is Kimberly Chen. I am an Assistant Secretary in the Office of Fiscal Affairs at the California Health and Human Services Agency. I'll provide a quick overview of our agency and the departments we oversee. Budget staff has done a great job of summarizing that already in the agenda, so I'm hoping not to repeat too much of the same information. So, as you all know, our mission is to work together with counties, cities, communities, our public, private, faith and educational partners to make California a healthy, vibrant, inclusive place to live, play, work and learn.

We're guided by three principal tenets of being person centered, equity focused, and data driven, and we do that through the 12 departments we oversee. You'll see them listed in the agenda, so I won't name every single one.

We also directly oversee five offices here at agency, including the Office of Youth and Community Registration, which you, of course, just heard from, and the Office of System Integration, which we'll hear from a little bit later on in the agenda today across all Cal HHS departments and offices, our total budget is $230.5 billion, total funds, 71 and a half billion of which is General funds and 128,000,000,000 federal funds.

The lion's share of the state funds goes towards Department of Healthcare Services, which is our state Medicaid agency running the medical program. So that's about 53% of it. 18% of the state funds follows going to Department of Social Services, and Department of the DDS goes after that. Across our departments and offices, of course, we've got over 38,000 positions within agencies. Specifically, our total funds are at 690,000,000, 62 million of which is General Fund.

I think the lion's share of our total funds is at the OSI office, which you'll hear again from later. At agency, we've got 556 positions, 90 of which are under the secretary and 33 are under the Office of Youth and Community Restoration under Judge Lacera, who. You just heard from.

I'll conclude there and say again that this is just a fairly broad overview of the activities at CalHHS. We look forward to engaging with you all over the next couple of months, diving into each of our Department and offices work. Happy to answer any questions or provide follow up information as needed. Thank you.

Thank you so much. We're going to hold public comment and questions at the end of all the issues. Next up, we'll hear on issue three, Statewide Automated Welfare System ongoing support.

Good morning, this is Brandon Hansard. Can you hear me?

Yes.

Okay, thank you. Madam Chair and Committee Members, again, my name is Brandon Hanserd. I'm Deputy Director of the Office of Systems Integration, and I'm here with my colleague from the Department of Social Services, Ryan Gillette. I do want to thank your staff for the detailed write up on this proposal, and again, due to time, I'll just briefly summarize the request.

I do also want to note, though, that we are on calendar for a complete Calsaws project overview for this Committee jointly with the leadership of the Calsaws project on April 27, and at that point we will cover in detail the activities to date and the future activities, including completion of the Calsaws migration to one single system and the future policy automations that are in queue.

I also want to inform you that the Calsaw's annual report was transmitted to this Committee earlier this morning, and we'll address any of the questions in that report. Also on April 27, for this specific state Administration budget proposal, we are asking to make permanent five existing positions whose funding does expire June 30 of this year.

The positions, which consist of three at the Department of Healthcare Services, one at Department of Social Services, and one at the Office of Systems Integration, are a vital part of the state's ability to continue to engage with the Calsaws project through the Calsaws migration and post migration enhancement activities for the Office of System Integration, we're responsible for the state level project management and the oversight of the Calsaws project and the project sponsors.

Both Department of Healthcare Services and Department of Social Services partner with us to verify project activities are conducted in accordance with contracted standards and adherence to information technology best practices. Department of Healthcare Services Resources identified here provide continued oversight of the Medi Cal eligibility policy functionality in Calsaws. It includes serving as the state sponsor representatives for the Medi Cal program, providing necessary policy guidance and technical assistance during Calsaw's activities related to migration, developing ancillary systems, and any ongoing enhancement efforts.

The specific Department of Social Services resource provides technical expertise to the Calsaws project and is responsible for providing technical planning, preparation, review, documentation, and support on the project as it relates to various social service programs and applications. By making these positions permanent, we are more adeptly positioned to make the most prudent and timely policy implementation decisions during Calsaw's migration and ongoing, through maintenance and enhancement, support of calsaws.

With these positions securely in place, the state will be equipped to monitor the future Calsaws risks and issues and be able to respond promptly to mitigate any potential harm to participants in the programs. With that, I will stop and see if you want to move to the next issue or ask questions.

Thanks. Brandon. I don't have any questions, any of my. We have one.

I'm just. And we did a lot of work with this last year and just checking, do you feel like we're on track for the December deadline and everything is going to be seamless? You're going to do one application and you're going to know everything you're eligible for and it's going to work like magic. Is that what we've done, Brandon?

Well, I will not say like magic. I will say we are on track, and I feel that the migration effort is very successful. On April 27, the state, along with the Calsaws project, is going to be happy to report on those activities, the milestones that we've already achieved, and what we see on the horizon going into the final waves of migrating Cowen counties into the Calsaws system. With any system of this magnitude, it's never seamless.

And so we always are vigilant in being proactive in mitigating any of the risks or issues that could arise, and in doing so keeping the system up and running for the counties that are already in Calsaws. while also attempting to migrate Cowen counties as seamlessly as possible.

So I appreciate that caveat. So you haven't seen any unforeseen circumstances that cause you alarm before your April update to us?

No. What I will say is that with any migration efforts, if something does happen, I will say the project has been very proactive in having mitigation strategies ready.

We just, over the past weekend, migrated three counties into Calsaws, and it's not without events that occurred during those migration efforts, but the resources that are able to be put on this project to mitigate that while you're converting the data over, they were able to remedy the situation and only have a couple of hour delay, which I do believe is a very successful migration and shows that all the proactive work to have different strategies ready and be able to utilize those during a conversion weekend were also successful.

And those were counties of varying sizes.

Yes.

That's okay. Thank you very much. I just want to make sure we weren't talking about just Sierra county or something.

No, in fact, it was Contra Costa, Taleri and Santa Clara.

Okay, good. Thank you.

Do we have any comments from DOF or LAO?

Ryan Miller, LAO. We have no concerns with the proposals under the HHS agency portion of the agenda.

Department of Finance no additional comments.

Great. We will now hold this item open and move on to the next issue. Issue four case management information and payrolling system.

Hi, good morning, Madam Chair and honorable Committee Members. Thank you for having us here today. My name is Lorna Eby and I'm the Deputy Director of the project Management Division at OSI and I'm here with my colleague Leora Philicina, Deputy Director of the Adult programs division at CDSS. I will be addressing question number one on the agenda today, and then I will be passing it to Leora to address question number two.

And as my colleague just noted, we have a very thorough background in your package, so I will keep this to a brief overview of the request itself. This proposal requests 10.7 million in expenditure authority for fiscal year 23, 24 for the case Management Information and payrolling system. This request also requests permanent position authority for two information technology specialist two positions for the Office of Systems Integration.

The increase in expenditure authority being requested for OSI is related to the implementation, maintenance and enhancement of the following previously approved initiatives, and again for brevity. I will keep the overview of these initiatives high level and welcome any questions at the end. We are requesting additional authority for electronic visit verification, for additional service desk agents to support the location services functionality, and to fund a dedicated agile team for maintenance and enhancement of location services.

We are requesting support for electronic forms to fund an agile team and to procure required software licenses. The electronic forms is an important initiative as it is helping move us away from a paper based forms for county workers, for their case management, as well as paper based applications for recipients and providers. We are requesting support for language support for 14 additional languages. This expenditure authority is being requested to establish service desk language line services, interactive voice recognition setup and changes, and language line testing services.

We are also requesting authority for a variety of security compliance initiatives, including the establishment of a 24 x seven security operations center, as well as setup of dynamic and static application and security testing initiatives. And then finally, we are asking for support for a variety of program efficiencies that have been put in place and resources to support those efficiencies. For example, the CMIPS operations team added more processing days when a peak timesheet submission day falls on a weekend or a holiday.

We are continuing to implement DevOps to improve operations and shorting our time for development and deployment, as well as continuing to build out our test automation capabilities. The two positions that are being requested are again a permanent position request for positions that were previously hired as limited term.

The delivery of the initiatives that I've just gone over resulted in a substantial increase in the volume of work and due to a lack of OSI resources to perform that additional workload, the CMIPs office established and filled two temporary its two positions using our blanket authority and we are requesting to make those positions permanent because this increased workload was not just to support development and implementation, but it was also be needed for the ongoing maintenance and enhancements that will follow.

Delivery of all these initiatives has and will result in an increased application and infrastructure footprint that will be ongoing. And so that addresses question number one. I will take a pause there and see if you have any questions or if you would like us to move on to question number two.

Question number two and then we'll ask questions.

Thank you and I will pass it to Leora to address question number two.

Thank you, Loorna Good afternoon, Madam Chair and Members. My name is Leora Felicina. I am the Deputy Director of the Adult Programs Division at the Department of Social Services. I oversee the IHSS program in home supportive services as well as adult protective services, the cash assistance program for immigrants SSISSP to address the second question, the EVV solution to capture geolocation has been developed and we're currently presenting that to stakeholders for their feedback.

Essentially, providers will have three options to meet the EVV requirements, and I do want to remind everyone that this really impacts non live in providers, that our live in providers are not required to do electronic visit verification. The three options they have is we have developed a new mobile application. We've modified the electronic services portal as well as given the option to use a landline telephone at the recipient's residence with our existing telephone timesheet system.

All three of these solutions are being currently demoed for providers and recipients. We did hold a stakeholder meeting on January 4 of 2023 to discuss the changes needed for electronic visit verification. Since then, we have done several focus groups with providers and recipients where we, like I said before, demonstrated the mobile application, the changes to electronic services portal, as well as talked about the telephone timesheet system. For the most part, the feedback has been positive with regards to the solutions.

So we have done our very best to make sure that anything we do is very simple, easy to use, not intrusive, and people have really responded positively to that. We will continue to do engagement through the July 1 implementation, so pretty much we'll be sending out notices, setting up informational sessions for individuals to call in and give know. We notice that every time we send a notice out, people feel there's lots of anxiety, particularly for EVV.

So our plan is to send notices, set up informational sessions for people to come in and ask questions so we can clarify. Additionally, starting in March, we are training our county partners and public authority partners, as well as our union partners on all of the different solutions so that they can answer questions should they receive them. As we go through the implementation period and people start to receive notices and the word gets out there a little bit more. So we're definitely being very proactive there.

Additionally, we'll be setting up another public stakeholder call at the end of this month to demonstrate the different solutions to the entire stakeholder group and get their feedback. So that's pretty much kind of the plan. We will also be doing very robust training sessions for providers, very similarly to what we did the first time we rolled out EvV. Multiple sessions in multiple languages each week, looking at six to eight sessions. Anec.ally, those sessions were very well attended the last time we did EVV.

Oftentimes we had up to 5000 providers in those sessions going through the training. So we are doing our very best to get people ready for this change. And really the goal is to get folks aware, get them trained and ready to go, and then work with them even after the implementation date and beyond to make sure that they have the resources that they need and that we can alleviate any fears that they have with regards to electronic visit verification.

So I will stop there and if there are any questions.

Thank you. I'll turn to LAO and DOF if they have any comments.

Ryan Miller, LAO we have no concerns.

Department of finance. No further concerns or comments at this time.

I'll start off with one question on my end. We currently have four languages in which we have the forms and notices. And you spoke, Deputy Director Lorna, to increase it to 14 to match MediCal. Of the 14, are we seeing the need for every single language and connected to that, the item line for language support, is that as a whole for 14 or if you get less, it's less money. You're on mute.

My apology, Senator. Thank you for that question. I'm going to defer to Leora on the programmatic question related to the languages in terms of if the line item is inclusive for the 14 and whether or not we would get less if we implemented less. I don't have that answer, but I'm happy to bring that back to you.

And with regards to the number of languages, yes, we are currently looking at data for the IHSS recipient population to ensure that we are not implementing languages that are not needed within the program. So there may be less than 14, depending on the languages, and there may be some changes as well. We know that medical has an additional 14 languages.

However, if for some reason there's a language spoken by IHSS recipients that are not included in that 14, we would also take a look at implementing that as well. So that's kind of an ongoing discussion as we go through. We're looking at data to ensure that we're giving folks the most accessibility as possible.

Thank you. I'd like to turn over to my Subcommitee Members for any questions. Seeing none, we will now hold this item open and move on to the next issue. Issue five Electric Visit Vertification phase two.

Thank you, Madam Chair. This is Lorna Eby, and I'll be speaking to this as well. And I'm also going to invite my colleagues, Joseph Billingsley, the assistant Deputy Director of integrated Systems of care at DHCS, and Stephen Pavlov, the Deputy Director of financial services at DDS, to join me on this call. At this time.

As with the other one, for brevity, I'm going to skip the background of the program, but I would like to highlight before I jump into the summary of the BCP request, the current status of the project, and some of the successes that EVV has had over the last year since we last reported out to you on this.

When we last met together, we had reported that in August of 2021, the EVV phase two project had officially began after receiving federal and state approvals and awarding a five year EVV solution contract to Sandata technologies. After the award of that contract, in December of 2021, just four months after contract award, we successfully implemented EVV for PCs. And then in September of 2022, we successfully implemented EVV for HHCS in compliance with the federal mandate of January 1st, 2023.

So we are fully implemented and fully compliant with the requirements of the 21st Century Cures act. And then in December of 2022, we received CMS certification of the EVV solution, and this allowed the state to request and receive enhanced federal funding of 75% for MNO. Had we not received certification from CMS, we would have been funded at a 50% matching rate. And so with that, I'm going to move on to just a brief overview of this proposal.

This BCP for 23,24 requests funding of 2.5 million with 832,000 General Fund for contract services and three permanent position resources for the Department of Healthcare Services. The DHCs position request is related to three previously approved limited term positions, and we are asking that they be made permanent to ensure continued program success and compliance with federal requirements.

We are requesting authority for contract services and we are requesting for an MNO support contract and to move expenditure to her authority related to existing contracts from this year to 23,24 to run out those contracts. And then we are requesting an interdepartmental contract request. And this essentially is a mechanism that allows both OSI, CDPH and CDA to be reimbursed for actual staff costs under this project. And then finally we are requesting a federal state funding split.

There is a 75% matching rate, as mentioned, for the Medicaid portion in MNO. And I do want to mention that as of the implementation of HHCS in September, we are now in MNO phase of the project. So we have moved out of implementation and are moving into the maintenance and operations phase. So the remaining 25% of that funding and then the non Medicaid portion will make up the state General Fund request of 832,000.

And with that I will pause to see if there are additional questions or clarifications that we can provide.

I'll turn it over to LAO or DOF for comments before questions.

Department of Finance Nina Hog nothing to add.

Ryan Miller, Lao and we have no concerns.

I have no questions. Colleagues, any questions? We'll now hold this item open and move on to the next issue. Issue number six, the California Emergency Medical Services data resource system. Welcome.

Yes, thank you again, Madam Chair and I will be speaking to this as well, and I will be inviting Rick Trussell to join me from AMSA. He is the chief of their administrative division. And again, I will just begin with the question, which is a brief overview of the proposal. This is a request by the Office of Systems Integration.

We are requesting 1.13 million in fiscal year 23, 24 expenditure authority for six limited term positions to provide project management, fiscal and procurement services to the Emergency Medical Services Authority in support of the California EMS Resource System project known as Cedars. The proposed Cedars project is intended to create links between various health information exchange systems to increase data interoperability between hospitals, EMS agencies and other healthcare organizations.

Cedars is envisioned to provide a solution that will allow for the aggregation and analysis of EMS data to ensure that patients receive the appropriate care by qualified EMS professionals, and includes a data repository for information on all EMS transport within California. This is needed to drive quality assurance to ensure that California EMS is aligned to national standards and best practices and to allow for better informed and data driven policy decisions.

The Cedars project was approved in stage one by the Department of Technology and Agency in 2021. We are currently in stage two alternatives analysis of the California Department of Technology's project approval lifecycle, or PAL, process. The PAL process is currently targeted for completion in June of 2024.

The OSI resources requested will ensure that all stages of the PAL process are managed consistent with project management and procurement best practices and within a collaborative and transparent governance framework to include inclusion across stakeholder groups to achieve the envision goals, objectives and outcomes. And with that, I will pause there.

Does LAO or DOF have any comment on this issue?

Ryan Miller LAO no concerns

Of Minutes no concerns.

I don't have any questions. Subcommitee Members, any questions on your end? Great. We'll hold this item open and move on to the next issue. Issue number seven, gender affirming care as it relates to SB 923.

Thank you, Kim. Mary Watanabe, Director of the Department of Managed Healthcare. SB 923 requires the California Health and Human Services Agency to convene a transgender, gender diverse, or intersex working group for the purposes of developing a quality standard for patient experience, to measure cultural competency related to the TGI community, and to recommend a training curriculum to provide trans-inclusive health care. The working group will conduct at least four listening sessions across the state with patients from the TGI community.

The quality standard and recommendations for the training curriculum will be developed no later than March of next year. As Kim mentioned, this function has been delegated to the Department. We're happy to take on that work. SB 923 requires health plans and their delegate staff, who are in direct contract with enrollees to complete evidencebased cultural competency training so they can proficiently provide transinclusive health care.

SB 923 also requires the cultural competency training to be facilitated by a TGI serving organization, and the training curriculum would be subject to the DMHC's approval following engagement with TGI serving organizations. The Bill stipulates that any health plan staff who have been found to have failed in providing transinclusive health care would be required to complete a refresher course on this topic.

SB 923 requires the DMHC to review individual case complaints the Department receives alleging discrimination based on gender identity and refer those complaints to the Civil Rights Department. We'll also review the complaints the Department receives involving improper denials to determine whether any enforcement actions, including sanctions, may be appropriate. We'll also review and approve the health plan's use of cultural competency training curriculum. We'll modify our existing plan survey methodologies and tools to include a review of policies and procedures for compliance.

We'll also be providing a status report to the Legislature semiannually until regulations are adopted. We'll issue guidance to the plans regarding the requirements for training related to this Bill and formally promulgate regulations.

The California Health and Human Services Agency is requesting expenditure authority of 400,000 in 23-24 from the General Fund to reimburse the DMHC for consultant services to plan, organize, and facilitate the TGI workgroup and the DMHC is requesting expenditure authority of four and a half positions and $1.2 million in 23-24 increasing to 2.2 million in 27-28 and annually thereafter from the managed care Fund to implement the requirements. I'm happy to take any questions on this.

Thank you. I'll turn over to LAO and DOF for comments.

Ryan Miller, LAO no concerns.

Joseph Donaldson, Department of Finance no additional comments at this time.

I do have one question here, the TGI, and this is directed to HHS assistant secretary Kimberly the TGI Working group was supposed to be started, convened by yesterday, March 1, with the report to come March 1 next year, and there is a budget request of 400k to start the group, given that it hasn't started, or maybe it has, how much far back? The results are going to be pushed back from March 1, 2024.

Yeah, we've been engaging in conversations with members of the community to work towards that working group, and I'll turn it over to Director Watanabe to talk a little bit more about those specific conversations.

Yeah, no, and we're working very closely. I think we've talked to both the authors and sponsors of this Bill to just talk about where we might be able to have a little bit of wiggle room on the start dates. We are really close to announcing the selection of the working group members and hope to have the first meeting convened actually this month.

Given all of that, we are still on track and hoping to have the decisions around the training curriculum as well as the quality metrics in place by the March 2024 date. So those dates are, I think, really critical. We want to make sure that training gets started, but we're about maybe a little bit around a month behind on convening the working group, but excited to get that work started.

So is it safe to say that the starting of the working group is not dependent on this funding?

Well, I would just say that at this time, DMHC is absorbing the cost of the resources to do this, so they're using their own staff time being taken away from other projects to do this. I think Director Watanabe herself is actually doing a lot of the work. Once this working group gets started, we're going to need a lot more technical and subject matter expertise, and that's where the funding resource comes in.

So we're able to do early convenings now as we're getting sort of the group together and upstarted. But once things start really going and we dive into the details, we'll need that resource request. So, Director Watanabe, if you have other things to add?

No. Great. Yeah.

Thank you. I'll turn over to my Subcommitee members questions. Thanks. We will now hold this item open and move on to the next issue. Issue number eight is the equity center programs transferred to Department of Public Health.

Good morning, Madam Chair. My name is Rohan Radhakrishna and I lead the Office of Health Equity. I serve as a Deputy Director and Chief Equity Officer for the Department of Public Health. In the interest of time, I'll be brief with the background and then answer the question.

Back in 2021, I served at the local level as a health officer when this budget act first included a position and General Fund expenditure of $1.7 million to conduct a retrospective analysis of the intersection of Covid-19 pandemic and health disparities. None of us knew how long this pandemic would be. It's still in front of us, not quite in the rear view mirror. Hence, a retrospective analysis hasn't been concluded.

The resource request we're here before you today is for our agency, CalHHS, to transfer one position in General Fund expenditure to the Department of Public Health that will take the lead on this retrospective analysis. There are other after action reports that have started. We will partner and coordinate with both internal and external after action reports.

But due to the ongoing nature of the response for our agency and our Department over the past three years, that is why, per question number two, the analysis has not yet been completed. We have a live dashboard that talks about some of the intersections of the social determinants of health and the pandemic.

We did issue a report and commission from the Public Health alliance that came out in July that has some recommendations, but it's not the original intent from this back in 2021, which is a, quote, retrospective analysis. So our aim is with this item to hire that one staff that will be the lead coordinator amongst a wide landscape, academic partners, internal, regional, local, other states to really learn from this once in a century pandemic from an equity perspective in my office.

I'll be happy to take the lead on that with this position. Happy to answer any questions.

Thank you so much. Turn it over to LAO and DOF for comments.

Ryan Miller, LAO, nothing to add at this time.

Nina Hoang, Department of Finance, nothing to add.

Thank you. Subcommittees, any questions? I'll turn it over to Senator Eggman.

I guess just for. I'm certainly not going to hold you responsible for the Administration. It's a little disappointing. We are all very excited about, well, I don't want to say excited. Public health has been underfunded for historically has been underfunded when the pandemic hit, we had a lot of assurances that we're going to invest a lot more in our public health system and make it much more effective and nimble and supportive of our locals.

One of the first things was going to be to take a look before we could invest all our new money, we're going to take a look. And so it's just disappointing that we're now yet one more year out and haven't yet begun to look.

Any other questions? Thank you. We'll now hold this item open and move on to the next issue. Thank you so much for coming. I appreciate you coming in person. We'll now move on to issue number nine, the OSI reorganization name change Trailer Bill Language.

Hi. Thank you, Madam Chair, Senators, my name is Adam Dondro. I'm the Director of the Office of Systems Integration and the CIO for the California Health and Human Services Agency. This Trailer Bill Request is pretty straightforward. It's a name change strictly from Office of Systems Integration to the proposed name of Office of Technology and Solutions Integration.

The rationale is based on me last year being appointed into that dual role as both the AIO as well as the Director of OSI, which allows us to take OSI, which has largely historically been focused on a subset of major and important it projects, and use my position as the AIO within the agency to provide more coordinated services across the entire agency and benefit from the technical expertise that we have.

Systems integration is a very term of art within technology, and it's not aptly descriptive of the breadth of what we do within the office. And so with the combination and this opportunity, we wanted to use it to bring a name that better defined what we did, and that's strictly what the proposal is. Happy to go into more detail or take any questions.

Any comments from LAO or DoF?

Ryan Miller, Lao, no concerns in the.

Nina Hoang Department of Finance. Nothing to add.

No questions on my end. Subcommitee Members, any questions? Thank you so much for coming, Adam. I appreciate it. We are going to hold this item open and move on to the next issue. We are now going to be moving into the Department of Healthcare access and Information, starting them with issue one or an overview.

Good afternoon, Madam Chair and Members. I'm Elizabeth Landsberg, the Director of the Department of Healthcare Access and Information, or HCAI. Pleased to provide a high level overview of HCAI's work and budget investments. So our current year budget is $1.5 billion. And then your agenda shows that it's decreasing significantly to $338,000,000 for fiscal year 23-24. The decrease of 1.2 billion is due to significant one time funding and funding available from prior years, the vast majority of it being for healthcare workforce development programs.

We are requesting nine positions in this budget, which will take us to 702 positions. HCAI, formerly OSHPD, the Office of Statewide Health Planning and Development, was created in 1978 to help the state understand the structure and function of its healthcare delivery systems. Our HCAI's role has expanded significantly over our four plus years, 40 plus years. So we graduated from an office to a Department two budgets ago.

Our mission is to expand equitable access to quality, affordable health care for all Californians through resilient facilities, actionable information and the Healthcare workforce that each community needs. And I'll just go through briefly our five program areas, facilities, financing, workforce data and affordability. On the data side, HCAI is a leader in collecting Healthcare data and disseminating information about California's Healthcare infrastructure and publishing information about Healthcare outcomes. We collect, analyze and disseminate information about hospitals, skilled nursing facilities, clinics and home health agencies.

This work encompasses the Healthcare Payments Data Program, which we are building the HPD program, often referred to as an Allpayer claims database. The information from the Healthcare Payments data program will support greater healthcare cost transparency and will be used to inform policy decisions regarding the provision of healthcare and to reduce healthcare costs and disparities. Moving on to facilities HCAI is the building Department for hospitals and skilled nursing facilities, monitoring the construction, renovation and seismic safety of these facilities.

Our primary goal is to promote patient safety by ensuring that each facility remains functional in the event of natural disasters, including major earthquakes. And I would just note that we have such experts that one of our structural engineers is actually leading a delegation to Turkey to assist in the recovery and to conduct research and reconnaissance of an area with similar seismicity as California.

Moving on to healthcare workforce programs, HCAI has a range of healthcare workforce development programs which seek to build a workforce that reflects California's racial and linguistic diversity, second, serves medically underserved areas and three serves MediCal Members. We support specifically healthcare workforce in the primary care, behavioral health and oral health areas.

We use a range of strategies, including pipeline programs, to introduce the health professions to youth from underrepresented communities, direct grant funding to medical schools, nursing programs and other health training institutions, and then scholarships and loan repayments and stipends to students and health professionals who agree to provide patient care in medically underserved areas. HCAI is also supporting providers and funding programs to ensure Californians and others have access to reproductive health care services, including abortion services.

We also at HCAI run a Cal mortgage program, which offers loan insurance to nonprofit and public health facilities for the development and expansion of healthcare services. Our Cal mortgage program is also administering the new small and rural Hospital relief program to provide grants to small, rural and critical access hospitals for seismic safety compliance projects. And then we're very pleased in the last year to add a fifth program area, affordability. So we're working to advance healthcare affordability in the state.

We have established in last year's budget the Office of Healthcare Affordability, or OHCA, which will analyze California's healthcare market for cost trends and drivers of spending. OHCA will enforce healthcare spending targets set by our Health Affordability Board and will conduct cost and market impact reviews of proposed healthcare consolidations.

The newly formed Healthcare Affordability Board we just had our last appointments earlier this week and the board will advise on key activities and approve specific aspects of OHCA's work with input from an Advisory Committee and the public to drive toward a high value system. In addition to cost targets, OHCA will measure and publicly report on quality and equity measures, adoption of alternative payment models, investment in primary care and behavioral health, and workforce stability.

Additionally, on the affordability side, in response to increasing prescription drug prices, as you know, the state has established the CalRX Biosimilar insulin initiative and HCAI is partnering with an entity to develop, manufacture and distribute short and long acting types of insulin products. So, Madam Chair, that is my overview of the Department and our work.

Thank you, Director Landsberg, LAO or DoF, do you have any comments?

Hi, Jason Constantouros, LAO. I think the Department did a good job introducing itself, so no additional comments on this item.

Yeah, Joseph Donaldson, Department of Finance. No additional comments at this time. Thank you.

Director I have one question in relation to the Song-Brown program and how we're able to roll over unspent funds for the next five years, do we often see that we have unspent funds in the different categories under that program?

We do have a limited amount of unspent funds Madam Chair. Karen Ricelle is on and can add if we need additional details. We do often have a small amount of unspent funds, but we are working very diligently. We know that the state is really facing a healthcare workforce crisis, so we're working diligently to get all of the dollars out, but we sometimes have a small amount that we do carry over from one year to the next.

Thank you, subcommitee members. Any questions?

We'll hold to the specific issues.

Great. Thank you so much, Director Lansberg. We will now hold this one, too. No, we will now move on to issue number two, support for health workforce education and training Council.

No, issue two, skilled nursing facility.

I amend, issue number two is the skilled nursing facility's backup power source related to AB 20511.

Good afternoon, Madam Chair and honorable committee members. I am Chris Tokas with the Department of Healthcare Access and Information, Deputy Director of the Office of Statewide Hospital Planning and Development. We are requesting a BCP for the additional workload required by HCAI to be performed as required by 2511 in regards to the skilled nursing facility backup power sources. Specifically, I will give you a brief overview of this proposal.

The Department of Healthcare Access and Information is required by AB 20511 to develop a work plan in an expedited time frame to ensure guidance to all the skilled nursing facilities prior to January 1, 2024. HCAI is requesting six positions and 1.45 $2 million of expenditure authority from the hospital building fund in the fiscal year 2324 and ongoing thereafter.

The hospital building fund is made up of fees paid by health facilities, including skilled nursing facilities, upon application for construction plan review to cover the cost of plan review and construction observations. AB 2511 requires skilled nursing facilities to have an alternative power source to protect resident health and safety for at least 96 hours during any type of power outage. That includes public safety, power shutoffs, any type of emergency, a natural disaster or other causes.

One of the AB 2511 requirements is that safe temperature levels must be maintained at a range between 71 degrees fahrenheit minimum to 81 degrees fahrenheit maximum. This may require skilled nurse facilities to provide air conditioning to comply with the provisions of the federal regulations as well as AB 2511.

In order to comply, a facility would be required to upgrade their emergency generator or install an alternative source of power that will have sufficient storage and generation power slash capability to maintain operation for no fewer than 96 hours. There are over 1000 skilled nursing facilities in California that will require electrical systems and equipment additions and some form of modification. Because of this requirement in statute, skilled nursing facilities will need to engage in project design, review and permit approvals.

Equipment supply line issues in the current environment, construction and inspection timelines HKA is currently working on regulations to codify the requirements of AB 2511. The department is working diligently with stakeholders to implement AB 2511 pursuant to the timelines within the statute. At this time, we do not have a trailer bill proposal we will keep the legislature up to date on any issues or implementation progress. At this point, Madam Chair, I will pause for any questions.

Thank you. I'd like to turn over to LAO and DOF for any comments.

Jason Constantouros, LAO, no concerns with this proposal.

Joseph Donaldson, Department of Finance, no additional comments at this time. Thank you.

I don't have any questions. Subcommitee Members, questions? Great. This time we will now hold this item open and move on to the next issue. Issue number three, hospitals seismic safety related to SB 1882.

Thank you. I will continue with a brief overview of the proposal. AB 1882 requires HCAI to do the following develop notices for public posting for hospital buildings that are noncompliant with the 2030 seismic safety standards number two, identify on our website the seismic status of general acute care hospitals.

And number three, hospitals that do not meet the 2030 deadline standards must also provide an annual status update on their structural performance category ratings of the buildings and the services provided in each general acute care hospital building until each of the hospital buildings comply with the seismic safety standards. In order to comply with these requirements, HCAI must undertake several activities prior to July 1 2023, including, number one, programming our existing in-house software to collect database information as required by law, for noncompliant general acute care hospitals.

Number two, develop multiple public posting notices that clearly convey to patients as well as the public whether the hospital is in compliance or not with the seismic safety regulations and standards. And number three, prepare and process the necessary regulations to the California Building Standards Commission during the 2022 intervening code cycle. In order to cover the cost of this work, HCAI is requesting $120,000 for the year 23-24 and ongoing for one permanent position for a compliance officer, health facility construction.

That's basically the requirements of 1882 and the basis of the budget change proposal that you have in front of you. So at this point, Madam Chair, I will pause again for any questions.

Thank you. Turning it over to LAO and DOF for comments.

Jason Constantouros, LAO, also no concerns with this proposal.

Yeah. Joseph Donaldson, Department of Finance. No additional comments at this time. Thank you.

No questions on my end. Subcommitee Members, any questions? Turn it over to Senator Roth.

Thank you, Madam Chair. I'm just curious, so we have about 476 acute care, general and psychiatric facilities and about 1162 SNFs per our analysis. Can you tell me what percentage of the structures involved here may not be repairable or functional following an earthquake?

When it comes down to the requirements of the Seismic Safety act, it does not pertain to the skilled nursing facilities. Skilled nursing facilities are not under the auspices of the seismic compliance requirement of the host of Facility Seismic Safety Act. Also, the same thing applies for behavioral health facilities. Behavioral health facilities are not under the auspices of the seismic safety compliance, only general acute care hospitals.

So how many do we have of those?

General acute hospitals, facility-wise? So we have 419. But if you look at the entire facility inventory, it works a little different because the seismic performance is building related. So it is building by building rather than what I would call the facilities because the facility might have multiple buildings in this case that have different seismic ratings.

So I can give you a quick overview of again, as far as building performance, we do have essentially out of 3275 buildings in 415 facilities, essentially 2554 to be exact, that they are compliant. So as far as the structural seismic requirements.

What's the number now? 2554, out of what, what's the total?

3275.

Okay.

As far as truly meeting the 2030 requirements, I guess, or buildings that they were built prior to 1973 and they do not meet what I would call or guess of the Seismic Safety Act requirements, those are about 674, as well as there are some that they are, again, I guess, or ranking in the lowest seismic performance category, which we call SPC1s. And there are about 47 to 50 buildings in that category. I'll be happy to provide you with more specific information.

Well, I guess I'm trying to get an idea of how significant the problem is because we've been talking about, I'm in my 11th year and we've been talking about this for 11 years. So I guess the question is, with respect to those that are not compliant, do we expect them to be compliant by 2025, 2030, 2035 or some point in the future? And if it's in the future, should I be concerned?

Senator Roth, Elizabeth Landsberg. So we're happy to follow up with you with the specific numbers in terms of the dates. We do have a 2030 deadline. So Mr. Tokus is referring to SPC as the structural performance categories. So all buildings that are currently SPC2 buildings, have to go through some renovation or they have to be retired by the year 2030.

Well, I assume that there will be some structures that are simply, and some operators that will simply be unable to bring facilities up to compliance regardless of the deadline.

We have proposed plans from many of those hospitals, and there are some hospitals that we have significant concerns about.

And then with respect to those that you have significant concerns about, I guess depending on the area where they're located in the state of California, should we be concerned about those as well.

Mr. Tokas can speak in more detail, but I do want to educate the committee that our standards are based on the seismicity of the particular hospital and the particular area. So a hospital on the San Andreas fault we have higher expectations for than a hospital that's inland and does not have that level of seismicity.

I can assure you, in inland Southern California, we have earthquake faults.

Right.

You can only look to Big Bear, the desert and where I live in Riverside. So for those facilities and operators who you know to be, or at least project to be unable to upgrade facilities, is there a state plan? We're dealing with the budget, so that's why I'm asking the question. Is there a state plan to deal with those facilities? Because I haven't seen it.

There was legislation that was passed last year that we're implementing the small and rural hospital relief program. And so there are some funds being made available to those small and rural and critical access hospitals. Just creating that program has been very helpful for us in outreach. So we do have a customer service oriented approach of working with hospitals and really trying to help them understand their options.

So it's been very helpful to have those hospitals come talk to our structural engineers, our architects, our mechanical engineers, so that we can help them develop plans.

Well, I apologize for asking the questions, and this is sort of an overview, and so I won't ask very many more, but I'm mindful of the fact that we're watching Turkey on TV, and I'm also mindful of the fact that we've had hospitals collapse in the past. And I'm also mindful of the fact that somebody needs to be asking the questions.

And having served on hospital boards in the past, in my past life, on several, several occasions over a fairly lengthy period of years, I also suspect that hospital operators are going to be unable to comply with our seismic safety standards. And the question is, are the structures that are left non compliant essential to healthcare services, or are they simply able to convert them into medical office buildings, which may not be on the critical list, and if they're unable to bring into compliance critical healthcare facilities,

I guess my question in the budget context is, what are we proposing to do about it so you all can get back to me at a later date, but I want to make sure to be on the record asking the question.

Very much appreciate the question. Certainly, we're watching everything going on in Turkey with great concern and would be very happy to follow up with you.

Thank you very much. Thank you, Madam Chair, for your patience.

Senator, thank you for your thoughtful questions there. We're going to hold this item open and move on to the next issue. Issue number four is the support for health workforce education and training council.

Good afternoon. My name is Caryn Rizell, I'm the Deputy Director with our Office of Health Workforce Development here at HCAI. So this BCP requests two positions in fiscal year 23-24 to support the work of the Workforce Education and Training Council. The council began meetings last year at this time and has already begun discussing the needs and innovative approaches to meet the state's workforce needs around nursing, behavioral health, and graduate medical education and primary care.

The council has been plans to meet four to six times a year with two day meetings. There's actually a two-day meeting going on this week. The positions are necessary to support the logistical, the administrative, the data analysis, and the policy analysis needs to support the work of the council. Thank you. Happy to answer any questions.

Turn it over to LAO and DOF for comments.

Jason Constantouros, LAO. On this issue, I would just note that we are working with the Department to clarify what fund source would be used to support the positions. As you can see on page 41 of your agenda, the department isn't requesting any additional funding. The department says it has some existing funding it can use to help support the positions, and we're just working to understand what that fund source is and make sure it's reasonable.

The department to date hasn't fully clarified that issue with us, but we're still working with them and we'll be in touch with the committee if we identify anything concerning. Thank you.

Yeah. Joseph Donaldson, Department of Finance. No additional comments at this time other than we're working with the department as well to address those questions for the LAO. Thank you.

No question,, but I will know the priority topic areas within this work group are so crucial in this time, and you've put the first one at the top. That's, in my opinion, even most crucial. And you're talking left up here in the diocese. There are two Senators who have been very vocal, correct me if I'm wrong, Senator Roth, about the workforce issue we're facing here instead of California and the investments we need to do in this.

So I do look forward to LAOhearing back to see if the funds are actually there. Even better. Thank you, Senator Roth. Any comment? Question? Well, we'll now hold this item open and move on to the next issue. Issue number five, abortion practical support fund as it relates to SB 1142.

Great. Thank you. I'll speak to this one as well. So HCAI requests $100,000 general fund annually through fiscal year 27-28 to contract with an external organization to conduct the annual evaluations of the work of this program. This BCP will fund the statutorily required evaluation needed for this program. HCAI has executed a contract with a nonprofit organization, Essential Access Health, to administer both this as well as the uncompensated care funds program.

And so we intend to contract with an external organization to conduct the evaluation of this program. Thank you. Happy to answer any questions.

Does LAO or DOF have any comments?

Jason Constantourous, LAO, no comments on this one.

Joseph Dalton, Department of Finance, no additional comments. Thank you.

No comments or questions on my end. Senator Roth? We'll hold this item open and move on to the next issue. That's issue number six, budget solution to healthcare workforce delays.

Thank you, Madam Chair, Committee Member. Joseph Donaldson, Department of Finance, I'll be taking the lead on this item. Due to declining state revenues, the budget proposes delaying 68 million in the current year and 329.4 million in the budget year for various healthcare workforce programs included in the 2022 budget under HKI's Administration. The mechanism to implement this proposal will be TBL, which is currently posted on the Department of Finance's website for your review.

Now, while the budget does propose these delays, the administration is still committed to increasing the capacity of the state's healthcare workforce. These programs will remain fully funded, but the funds would go out later than originally planned. Now, the repayments for these delays would go out in 24-25 and 25-26 in the amount of 198.7 million in each of those specified years.

Now, in closing, we'll acknowledge that while we understand that these are difficult decisions to consider, the administration believes that these are necessary actions to address the current revenue shortfall while also maintaining our commitment to our state's healthcare workforce. And I'll pause here to answer any questions, or I can go to the second question that was on the agenda as well.

Second question, please.

All right, no problem. Second question pertained to the proposed trailer Bill and the intent to repay these repayments in 24-25 and 26. First, the administration would just want to reiterate its commitment to increasing the capacity of our state's healthcare workforce. The aministration proposed substantial investments that were ultimately included in the Budget Act of 22. Additionally, we would stress that these investments are delays, they're not cuts and will remain fully funded at their original levels.

Furthermore, the administration is carrying these repayments in our long-term forecasts and is committed to repaying these funds in the specified years in this proposal. Happy to answer any questions you have. Thank you.

My question to HCAI, actually. If we got the money, how fast could the programs be ready?

Thank you very much, Madam Chair. We are administering these programs, right. These are programs that were adopted in last year's budget, and the team has worked very hard to implement them as quickly as possible. So these are programs that are in flight.

Would the LAO like to comment on my question or respond to my question?

Sure. Jason Constantouros, LAO, in terms of the question, was whether, how quickly these initiatives could be sort of implemented, and it does depend a little bit on which initiative we're talking about. There are some initiatives that were adopted last year that are not being proposed for solutions, for example, that currently have not been implemented. They're scheduled to begin sometime this summer. An example there would be the graduate medical education and loan repayment for psychiatrists that's described on page 46 of your agenda.

That's that fourth bullet under behavioral health. Again, that's one that the administration is not proposing for solutions but hasn't yet been implemented. Some of these other initiatives were in the midst of being implemented, for example, some of the community health workers and social work and comprehensive nursing initiatives. Our understanding is that those already have been implemented to some extent in the current year and that the administration had planned on, prior to this proposal, had planned on continuing that implementation in the next few years.

So it really depends on which initiative we're talking about.

Senator Roth.

Thank you, Madam Chair. You know, I think the issue is implement versus achieving actual results. These behavioral health workforce programs appear to be, and the behavioral health workforce itself appears to be the linchpin to many of the programs that we deal with in this proposed budget. The budget last year and the budgets that preceded it are those from the DJJ realignment to care court to housing and our homelessness efforts. And these workforce initiatives don't happen overnight.

For example, expanding masters in social work slots at public schools of social work. I'm not a social worker. I think my colleagues, one on the left and the one on the right, are, certainly have experience. And it's my understanding it's not just the classroom education. It's the thousands of hours of clinical experience that are required before licensure that take time. Psychiatrists don't happen overnight. It's not only the medical school education, it's the psychiatric residency that I'm sure takes at least three years to complete.

So I'm concerned about deferring the start of these workforce programs because it's going to delay the point at which not only the programs are implemented, but the point at which results are achieved in terms of additional behavioral health workers in the field providing services, whether it's in the CareCorp program, whether it's in the folks who are realigned out of our DJJ system to the counties, whether it's in our housing and homelessness efforts on the streets of communities around the state.

And I totaled it up, and it looks like it's about $397,000,000 in programs that we're deferring. And I'm just wondering in a budget that is what the $300 million budget that we can't find $397,000,000 of savings somewhere else in programs that, while essential, are not absolutely critical in terms of the time at which they start. So that's not a question. I apologize for it. It's a comment, but it's certainly a concern of mine.

And I think we need to look for $397,000,000 somewhere else and start these behavioral health workforce training programs and the funding for them and start them now. I do have a question, though. Without these deferrals, do you believe that the funding that we have provided for psychiatric residency programs, other mental health training programs in our budget and budgets is adequate based on the new programs that we implemented last year and that we're implementing this year that absolutely depend on a supply of mental health providers for programmatic success?

Senator Roth, I'm happy to start, and then I'll ask Deputy Director Reisel to add additional specificity. So you've raised a couple of different programs. So, for example, on the social work side, we have a social work education capacity program that issues grants, and we've had great success in supporting existing both behavior, pardon me, both MSW programs, BSW Programs, expanding those programs. We're proud to say there are a lot of new four plus one accelerated masters in social work programs.

So, for example, we are putting funds and we made significant awards in the past year to expand social work educational capacity. We're starting the stipend program, and so we have the existing infrastructure and we will use as many dollars as are made available. Same thing on psychiatry, certainly, as you know, it takes a long time to train a psychiatrist, but we launched the psychiatric Educational capacity program a couple of years ago and again are funding psychiatric residency programs.

There is significant need for psychiatrists in California, and of course there's geographic mal distribution. Our HCAI data research center issued a report just last month that shows the geographic maldistribution. So you can look and see psychiatrists where are know. No surprise, we don't have enough psychiatrists in the rural north and the Inland Empire in the Central Valley. So these programs are all very important and we stand ready to do whatever we can.

Well, thank you very much for the response. And if I sounded overly critical, I didn't mean to be. I am concerned, and I think that concern is going to translate, I think, into some degree of review by my colleagues and I with respect to the budget proposals, because I really would like to find some way to continue these workforce training programs now because of the long time between implementation and achieved results. So thank you very much for your response. Thank you, Madam Chair, for your patience.

I would like to echo my colleagues remarks and also say while it seems like a lot of money during a year of deficit. This is a preventative measure, a measure that if we don't invest, or continue to invest right now, it's going to be triple the amount we're going to need to have available because these are preventative measures to have workforce out there dealing with our most vulnerable, our most vulnerable that sometimes are on the brink of becoming even more vulnerable.

That in turn is going to require California to help in other social services. So we will know. I look forward to continuing this conversation specifically to workforce and the potential delays here. I'm going to leave this item open for now and move on to the next issue. We are now actually going to be moving on to the Department of Managed Healthcare, starting off with issue one and an overview.

Hi. Good afternoon, Madam Chair and Members again, Mary Watanabe. I'm the Director of the Department of Managed Health Care. With me, I have Dan Southerner, Chief Deputy Director, and we'll take turns reviewing our budget change proposals. First, I'll start with a quick overview of the Department. The DMHC licenses and regulates 140 health plans that provide health care coverage to over 28 million Californians. We regulate more than 96% of the commercial and government health plan enrollment in the state.

Our total proposed fiscal year 23-24 budget is 157,000,685 authorized physicians. We're specially funded by annual assessments on health plans and receive no General Fund. The DMHC regulates health plans in a number of ways. We license and approve plan products for full service behavioral health, vision, and dental and chiropractic plans. We ensure basic healthcare services and mandated benefits are provided. We review health plan networks upon initial licensure and on an annual basis, and when health plans expand or contract their service area.

We review Health Plan Timely Access Compliance report filings and prepare an annual timely access report. We review consumer and provider complaints. Since 2000, we've assisted over 2.6 million consumers and recovered over 177,000,000 for providers. We also administer the independent medical review process, conduct routine health plan medical surveys and financial exams, and monitor the financial solvency and review health plan rate filings. We've saved consumers over 296,000,000 since the beginning of the rate review program. And finally, we prosecute noncompliant health plans via fines, penalties, and other corrective action plans. That concludes my overview. I'm happy to take questions, or we can move on to our other items.

Thank you. Does LAO or DOF have any comments?

Jason Constantouros, LAO. The Department did a good job providing an overview of its operations and budget. So we don't have any additional comments on this item, and this is helpful to know for time management purposes. We don't have concerns with DMHC proposals broadly, but are available for questions.

Yeah. Joseph Donaldson, Department of Finance, available for additional comments on this item. Thank you.

We'll turn over now to issue number two, information security resources.

All right, Dan's going to cover that one. Thank you.

Good afternoon, Madam Chair. Members of the Subcommitee, DMC's Office of Technology and Innovation, is tasked with providing project management, reengineering, and automating critical business processes to mitigate security vulnerabilities.

In 2021, the California Military Department, in an independent security audit, identified the DMC as lacking adequate information security resources to capture data, perform critical daily security practices, and document security procedures. It was determined that the DMEC needs to adopt 38 new information security policies, 12 information security and privacy plans, and at minimum, 87 procedures that need to be created and maintained. The DMC currently lacks sufficient resources to implement, operationalize, maintain the required security controls, and address ongoing rowing security threats identified in the security assessments.

The DMC is requesting expenditure authority of approximately $3.5 million in 23-24 increasing to $3.6 million in fiscal year 27-28 and annually thereafter to Fund the requested 5.0 positions, and this funding request also includes consulting funding requests. That concludes my brief overview and we're happy to answer any questions.

Does LAO or DOF have any comments?

Jason Constantouros LAO, no additional comments.

Joseph Donaldson, Department of Finance, no additional comments. Thank you.

I don't have any questions, Senator. Seeing none. We're going to hold this item open and move on to the next issue. Issue number three Office of Legal Services, Department of Justice legal fees.

Due to an increase in the statutory requirements on health plans, coverage of abortion and mental health services, and changes due to Covid-19 requirements, the DMHC has been a defendant in two to three legal actions per year since 2019. Given the high level of complexity and significance of these matters, the DMHC utilizes the Attorney General's Office for legal guidance and to prepare these cases for hearings. The DMHC is requesting expenditure authority to address the Attorney General's Office legal fees.

The DMHC has not had sufficient resources to address these associated costs and historically, the DMHC has reallocated money from salary savings to cover excess Attorney General office legal fees, which is not a viable long term solution. The DMHC is requesting expenditure authority of $400,000 in fiscal year 23-24 and ongoing to support legal representation by the Attorney General's Office in litigation to which the DMHC as a party are called as a witness. That's my concludes, my brief overview. More than happy to answer any questions.

Thank you, Chief Deputy Director turning it over to LAO or DOA for any comments.

Jason Constantouros, LAO no additional comments.

Mr. Donaldson, Department of Finance no additional comments. Thank you.

No comments from me, seeing none, we're going to leave this item open and turn to the next issue. Issue number four Office of Financial review workload.

The DVC's Office of Financial Review works to ensure stability in California's healthcare delivery system by actively monitoring the financial status of health plans and provider groups, also known as risk bearing organizations, so they can meet the financial obligations to consumers, providers and purchasers. The DBC's Office of Financial Review conducts this oversight through routine and nonroutine financial examinations of each health plan and RBO.

The number of DMHC's licensed health plans under the DMHC's jurisdiction has steadily increased, from 121 licensed health plans in 2015 to 140 health plans in 2021.

In addition to addressing the workload associated with the increased number of licensed health plan, the DMHC has determined that's in the best interest of enrollees and stakeholders to transition to a schedule where every licensed health plan is examined at least once every three years instead of the current five years, and that RBOs are examined every five years instead of the current eight years.

Less frequent examinations of health plans may result in an increase in the number of health plans and RBOs that are financially insolvent or noncompliant with the Knox Keene Act. To address this workload, the DMHC is requesting expenditure authority of 14.5 positions and $2.68 million in fiscal year 23-24 and $2.55 million in 24-25 and annually thereafter to conduct the more frequent financial examinations and address the additional workload associated with the increased number of health plans. That concludes my brief overview. More than happy to answer any questions.

Any comments from LAO or DoF?

Jason Constantouros, LAO no additional comments.

Joseph Donaldson, Department of Finance no additional comments.

A quick question, Chief W. Director, a lot of positions here. Do you feel confident that you'll be able to fill in those positions? Hire that on? And two, is there a number that you'd be able to survive that doesn't meet the 14?

I'm confident that we'll be able to expeditiously hire these positions if approved. With respect to your second question, I think we might need to get back to you with that.

Seeing nothing else, we will now hold this item open. Thank you so much, and move on to the next issue. Issue number five health care coverage abortion services cost sharing related to SB 245.

Thank you. I'm going to turn it back over to our Director, Mary Watanabe, to walk through our legislative BCBs.

Thank you, Dan. SB 245 requires full service health plans to cover abortion and abortion related services, including pre abortion and abortion follow up services, without a copayment, deductible or any cost sharing. SB 245 requires the DMHC to interpret and implement the provisions of SB 245 in consultation with the Department of Healthcare Services and the California Department of Insurance by means of all plan letters or similar guidance.

We will also adopt regulations by January 1 of 2026 and annually review health plan documents, including evidence of coverage and disclosure forms, utilization management data, and health plan survey data to ensure in compliance with SB 245. The DMHC is requesting limited term expenditure authority of 499,000 in 23-24 and 483,000 in 24-25 through 27-28 to develop legal memorandum and regulations required by SB 245. That concludes my overview of this proposal.

Does LAO or DOF have any comments?

Jason Constantouros, LAO no additional comments.

Joseph Donaldson, Department of Finance no additional comments. Thank you.

I have no question over here, seeing nothing else, we're going to hold this item open and move on to the next issue. Next issue is issue six, health care coverage, mental health and substance use disorders related to AB 2581.

Okay, thank you. AB 2581 requires health plans that provide coverage for mental health or substance use disorder treatment and to credential healthcare providers to complete the credentialing process within 60 days of receiving a completed provider credentialing application from providers that deliver mental health and substance use disorders. AB 2581 also specifies that a health plan must notify the credentialing applicant within seven days to verify receipt of the application and confirm that their application is complete.

DMHC will be required to annually review health plan documents to ensure compliance with these new provisions, modify our existing plan survey methodologies and tools, and we're requesting expenditure authority of a half a position and 27,000 in 23-24 increasing to 177,000 in 25-26 and annually thereafter. That concludes my overview.

Does LAO or DoF have any comments?

Jason Constantouros. No additional comments.

Joseph Donaldson, Department of Finance no additional comments. Thank you.

No question on my end. We have one question with Senator Roth.

Just a quick question. How does DMHC assure the adequacy of the since we're talking about coverage, the mental health provider panel, for example?

Yeah, there's a number of ways that we look at the adequacy of the provider network that the plans have. And I'll let Dan jump in here, too, if he has anything to add. When plans initially apply for a license, we make sure they have an adequate network to provide all of the services and benefits they're required to cover.

We also have an annual network filing where we look at the availability, both the geographic availability as well as there's other requirements around the number of providers they need to have in their network. Annually, we also look at whether or not the plans are able to provide timely access. There's a survey that they do to make sure they're ensuring compliance with the law. Dan, what else am I missing in terms of our overview of the networks?

A couple of things. One is if there is a 10% change in the names of the providers in the network, those health plans must file those with us so that we can assess that. In addition, if a health plan looks to expand or contract their service area, we will do another review of their network to ensure that their expansion or contraction area is compliant with network requirements.

Are there issues with some or maybe many of the managed care plans in this state? And if so, what do we, or do you do about it with respect to behavioral health providers? Because obviously that's a concern of mine today.

Yeah, maybe I'll start here. I will say, I think we're well aware of the workforce challenges in the state, so I think we look to make sure the plans are meeting the requirements of the law. But one of the new requirements that was a result of some new legislation we've had in the last year or two is that if the plans can't provide a timely appointment within the geographic requirements within their network, they need to help and arrange for care out of network for the enrollees.

And so that's a really important backstop to ensure enrollees are getting the access they need is that the plan should be helping them to arrange for out of network care. I also will note that we have behavioral health investigations that we've been conducting to really try to understand what the barriers are to accessing care and whether that includes just lack of consumer understanding of how to access care from the beginning, whether this has to do with barriers to providers wanting to contract. So more information to come on some of those barriers. Dan, do you want to add anything?

Yeah, just one other thing is as we're analyzing health plans, network filing, and we see gaps, we work with the health plan to try and fill those gaps before we would approve that network filing, and in most cases, that results in additional providers being added to the network.

With respect to these behavioral health investigations, have they been completed or are they ongoing? And if ongoing, do you have a timeline for completion?

Yeah, no, they're ongoing. So we've committed to conducting five a year. This is on the commercial health plan side, so this is not on the MediCal side. We are getting close to being prepared to release kind of our first summer report on the first five that should be coming here in the next few months, and that will continue on for the next probably four or five years.

As we've added plans, this is going to continue a little bit, but I think those initial reports will shed some light on just what we've learned in terms of violations of the law, but also just barriers that aren't necessarily a violation of the law, but create challenges both for consumers accessing care as well as providers.

Thank you. Thank you for that detailed response. Thank you, Madam Chair.

Seeing nothing else, we're going to hold this item open and move on to the next issue, which is issue seven. Healthcare coverage prescription drugs as it relates to AB 2352.

AB 2352 requires a health plan to provide specified information about a prescription drug upon request by the enrollee or the prescribing provider. This bill allows prescribing providers and patients to discuss drug costs at the time the drugs are being prescribed to help consumers make more informed choices. In addition, this bill prohibits health plans or insurers from restricting a prescribing provider from sharing information about the prescription drug or penalizing a provider for prescribing a lower cost prescription drug.

It also requires health plans to respond to requests for prescription drug information from providers or patients in real time through a standard application programming interface or API. AB 2352 requires a DMHC to annually review health plan documents to ensure they're complying with these provisions and to modify our existing survey methodologies and tools, including technical assistance guides. We're requesting expenditure authority of two positions and 343,000 in 23-24 and decreasing to 333,000 in 25-26 and annually thereafter. That concludes my overview.

Any comments from LAO or DOF on this item?

Jason Constantouros, LAO no additional comments.

Joseph Donaldson, Department of Finance no additional comments. Thank you.

Thank you. No questions on my end. We're going to hold this item open and continue to the next issue. Number eight on health information related to SB 1419.

Okay, another API related bill, SB 1419 requires health plans to establish and maintain a provider directory application program interface that provides a complete and accurate directory of the health plan's network of contracting providers. This bill requires health plans to establish and maintain an application program interface, or API, for both patient access, provider directory information and payer to payer exchange. SB 1419 also amended existing prohibitions on the disclosure of medical records to the minor's representative.

The DMHC will annually review the compensation arrangements of administrative services agreements submitted by all health plan types. We'll review health plan documents and contract templates provided during our routine examinations. We'll review health plan subscriber contracts and provider contracts and various other health plan documents, and we'll modify our existing survey methodologies and tools. We're requesting three positions in 572,000 23-24 and 547,000 2425 and annually thereafter. That completes my overview.

Thank you. Any comment on by LAO or DoF?

Jason Constantouros, sell no additional comment.

Just the Donaldson Department of Finance. No additional comment. Thank you.

Thank you. No questions on my end. We're going to hold this item open and move on to the next issue. Issue nine on healthcare service plans discipline civil penalties relates to SB 858.

SB 858 revised the administrative and civil penalty provisions of the Knox Keene Act and increased various specified penalty amounts assessed for violations of the Knox Keen act. This bill provides the DMHC with specific authority to impose corrective action plans on health plans for violation of the Knox Keene Act. It also increased the civil penalty amount for violations of the Knox Keene Act from 2500 to no more than 25,000.

Additionally, SB 858 updates various specific dollar amount penalties throughout the Knox Keene Act applicable to civil penalties, criminal penalties and various administrative penalties. SB 858 requires the DMHC to conduct annual rate change analysis, to analyze, calculate and combine the average rate change information for the individual and small group markets. We'll assess the financial impact of increased penalties on health plans and conduct financial monitoring of corrective actions for health plans and risk varying organizations, develop comprehensive health plan survey corrective action plans, conduct ongoing review health plan filings, and again modify our survey tools. The DMHC will need to establish a compliance team that will be housed in our Office of Enforcement to monitor enforce health plan compliance with corrective action plans. We'll lead the review and assessment of the severity of issues that come to the DMHC's attention, whether from internal offices, external stakeholders, the media, et cetera, to determine if immediate action is needed. To accomplish this, we're requesting expenditure authority of 40.5 positions and 12.6 million in 23-24 decreasing to 9.7 million in 27-28 and annually thereafter. And that concludes my overview of that one.

Turning it over to LAO or DoF for comments.

Jason Constantouros, LAO. No additional comments.

Joseph Dawson, Department of Finance. No additional comments. Thank you.

Thank you. It's the same question, you know, on the larger request, with a lot of positions, just being mindful of the deficit. I would love to see if there's any room to cut it just a little bit to be more reasonable. I don't want to say that word. Just be more mindful, I suppose. Senator Roth. Seeing nothing else, we will now hold this item open and move on to our last Department of today. That's the California Health Benefit Exchange known as Covered California issue number one. Overview and open Enrollment update.

So much, Madam Chair and Senator Ross, my name is Katie Ravel. I'm the Director of policy, eligibility and research at Covered California, and I'll address issue one for you this afternoon. The federal Affordable Care Act, which was passed in 2010, reformed the individual health insurance market. It established public marketplaces that offer comprehensive health plans with income based financial help to lower premiums and out of pocket costs for individuals who do not have affordable coverage through an employer, MedicAid, or MediCare.

And Covered California is California's marketplace under the Affordable Care Act, our mission is to increase the number of insured Californians, improve healthcare quality, lower costs, and reduce health disparities through an innovative, competitive marketplace that empowers consumers to choose the health plan and providers that give them the best value. Over the last two years, federal action has built on the foundation of the Affordable Care Act to provide more financial support to our enrollees to afford coverage.

The American Rescue Plan, enacted in 2021 and the Inflation Reduction act significantly increased the federal premium support for individuals at all income levels, removing premium requirements for the lowest income enrollees and removing the income cap that previously prevented middle income enrollees from accessing federal support. This enhanced federal financial support significantly increased Covered California's enrollment compared to pre pandemic levels. In the latest open enrollment period, which closed on January 31, Covered California renewed about 1.5 million enrollees and added more than 250,000 new enrollees. That concludes my brief overview in the interest of time, but I'd be happy to answer any questions you have.

Thank you so much. Any comments from LAO or DOF?

Joseph Donaldson, Department of Finance no additional comments. Thank you.

Luke Koushmaro with LAO no comments on our end.

Any questions? Great. Thank you so much, Director. We're going to move on to issue number two, budget solution, California Premium subsidy program reversion to General Fund.

Thank you, Madam Chair and members. Matt Aguilera, Department of Finance the agenda provides an extensive history on Covered California. In recent history, the Budget Act of 2022 provided a state contingency appropriation of 304,000,000 from the Healthcare Affordability Reserve Fund in case more generous federal subsidies were not extended beyond 2022 or if the state implemented healthcare affordability measures. Fortunately, the Federal Government extended the subsidies for three more years, and the current service level for California remains without any reduction in services.

The Legislature also passed SB 944, which would have required Covered California to reduce cost sharing if federal premium subsidies were extended. While citing the merits of the bill and his pleasure of working with the Legislature to enact groundbreaking coverage expansions through Medi Cal, the Governor vetoed the bill due to concerns over a downturn in revenues, sustainability for a new state only program, and the need to hold these funds in Reserve until after the federal subsidies end.

Since that time, state revenues have declined further and as such, the Governor's Budget now proposes to use these reserves instead to temporarily help the state's budget situation. Trailer Bill language would implement the proposal and it is posted on the finance web page. Specifically, it would revert the $304,000,000 contingency appropriation and direct the controller to transfer the Reserve balance to the General Fund. The funds would be repaid to the Reserve Fund after the federal subsidies end, and with that I'm happy to answer any questions you might have.

First turning it to LAO and DOF for comments.

Thank you Luke Koushmaro with the Legislative Analyst Office. First, I want to note that the funding that's being proposed to be temporarily transferred to the General Fund is 333.4 million from the Healthcare Affordability Reserve to the General Fund.

In addition, in the 22-23 budget package, this funding was originally intended to start the California Premium subsidy program and then after the 23-24 budget year, which would use the health Care Affordability Resort Fund, the remaining amount would be funded on an ongoing basis using 304,000,000 General Fund.

At the time that the budget package was enacted, there was awareness that the Federal Government might extend the federal premium subsidies and as such provisions were included in the budget package, noting that in the event the enhanced federal premium subsidies were extended, the funding could be used to provide additional financial assistance to Covered California consumers with household incomes up to 600% of the federal poverty level.

We find that given the budget condition, this proposal could have merit as it does not impact the level of affordability assistance that Covered California consumers currently receive, so it shouldn't have a negative impact on the existing consumers. However, we note that because the 22-23 budget package included provisions for what could be done with this funding to provide additional financial assistance, the proposal might not be aligned with the legislative priorities.

To the extent the Legislature chooses to maintain the funding to provide additional financial assistance for Covid California consumers, the state budget shortfall would increase by that amount and as such there would be a need to provide additional budget solutions in other areas of the budget to accommodate it. Thank you.

Matt Aguilera for finance we concur with the LAO that the amount of benefit to the budget solution here is 333.4 million, which is all the funds available in the Reserve.

Thank you. I understand that it's a feeling like we're trying to save it on the backs of our low income community or constituents or Californians, because should this have been used for what it was intended, approximately 450,000 Californians would have their deductibles eliminated in a time where we're having really high rates of health disparities in communities, especially in communities that I represent, areas with individuals that any extra support we can give them where they actually feel it is very beneficial. It is the intent of our body to obviously also look into this deficit, and there's going to be cuts in various entities. But I just wanted to note some initial thoughts that I have here. Senator Roth, questions? Comments?

Thank you, Madam Chair. I'm just trying to follow the money here. Can you all at least tell me that the money will be used in the healthcare arena on another healthcare line item to improve access to healthcare to our most vulnerable?

These funds right now are going to the benefit of the General Fund, and they're being used for the overall state priorities. As noted in the testimony, the budget does include funding for important policies, such as the Medi Cal expansion. So, yeah, we appreciate the concerns, and we understand the concerns. We still have concerns with implementing a new state only program, given the fiscal situation.

Well, given the cuts and the deferrals, I'm just trying to. It would be helpful and certainly more comforting to some of us who have been in this budget process for a while. If you're taking money that Californians paid as a penalty, essentially in the healthcare arena, and you're using that money for healthcare purposes somewhere else in the budget to alleviate a deferral or a cut that otherwise would need to be proposed. But I'm just telling us that it's being dumped in the General Fund budget to be used for General Fund purposes is not particularly helpful. But again, I'm not an accountant, nor am I a finance person. So I guess I'll have to accept that answer. Thank you very much, though, for your response. Thank you, Madam Chair.

Thank you for everyone, for all the presentations, the BCP presentations. We will now, we're going to hold that item open and close out there. We will now move on to anyone wanting to provide public comment. As a reminder, today's participant number is 1844-291-6364 and the access code is 455-6378 we're going to first begin with any witnesses here in room 1200. Let's begin.

Thank you, Madam Chair and Members, Diana Douglas with Health Access California, specifically commenting on Covered California Issues 1 and 2. As noted, affordability remains a significant barrier to Californians accessing the health care that they need when they need it. With deductibles as high as $5,000 and copays for just primary care visits around $50, it's not surprising that many low and middle-income Californians forego care when they need it.

As noted, the administration is collecting hundreds of millions per year from Californians who are uninsured and who cannot afford health insurance. In fact, over $1 billion has been collected in penalty revenue in just the first three years of the individual mandate penalty. This penalty money should be used to help Californians afford coverage and care.

Covered California completed a stakeholder process and report showing that we could, with just over 300 million, eliminate deductibles and dramatically reduce copays for Californians up to 600 percent FPL, around $75,000 per year salary for an individual. It's time that the administration make good on earlier assurances that affordability in our marketplace would remain a priority. And we know that we can do that with about 300 million.

We understand that the proposal is to sweep that amount, but we also know that many, many hundreds of millions more have previously been collected and have already been swept. Additionally, on another item on the Department of Managed Healthcare, issue number nine, I would like to express support for the department's request for implementation of SB 858, especially given the department's funding via special fund, via money paid by health plans. We thank you very much.

Beth Capell here, on behalf of the Teamsters and United Nurses, two of the many co-sponsors of AB 2350 which the Governor did sign last year to provide health benefits to striking workers through Covered California, providing them immediate and affordable coverage. That item was unfortunately not clearly funded in the budget, and so because it's part of Covered California, and this is the day you're hearing Covered California, we wanted to bring it to your attention.

Covered California is starting up the program and is funding the operational costs out of its own budget. But, the subsidy for the additional affordability help would amount to about $2 million a year in an average year. Or, if this works as well as we hope, employers are not required to remove health benefits from striking workers. And it would be our hope that it never happens, that never again will an employer in California weaponize health benefits as a way of settling a labor dispute. Thank you.

Thank you.

Mark Farouk on behalf of the California Hospital Association, commenting on the workforce investments that were mentioned earlier, I want to first thank the Committee chair and the Members for highlighting the importance of workforce investments. California hospitals are facing some of the worst staffing shortages in memory. In a recent survey of our hospitals, our Members have indicated that shortages exist across all staffing categories. But specifically, registered nurses representing the highest need. Hospitals have indicated these shortages occurred prior to COVID.

But COVID has, of course, exacerbated those shortages. CHA and our 400 Members really appreciate the work of the legislature and governor in last year's budget in making these critical investments in the workforce, specifically related to nursing, social workers, emergency medical technicians, and behavioral and community health workers. CHA does raise concern that any delays, reductions or trigger cuts in workforce development will negatively impact and further delay resolution to our workforce crisis and essential workforce programs that are now more essential than ever before. Thank you.

Thank you very much, Vanessa Cajina with KP Public Affairs on behalf of Visión y Compromiso, the statewide network of Promotoras De Saludan community health workers, we have been working closely and really appreciate the work that the Department of Healthcare Access and Information has been doing on the rollout of the community health worker benefit through the certification process and training.

However, we do remain concerned that there is a bit of a delta for a lot of community based organizations that have been employing Promotoras De Salud and understanding that the capacity isn't quite there yet in terms of integrating them into the MediCal benefit that we really expect to be helping communities and creating health equity.

In the spirit of optimism, we are working on a budget proposal this year to help increase that capacity building for the Promotores De Salud, keeping our fingers crossed for a rosier spring, but look forward to working with the department and with this committee on that item. Thank you.

Thank you. Kelly Brooks, I'm here today on behalf of two clients, both commenting on the workforce funding delays that were discussed earlier in the hearing. Thank you very much for the conversation you had earlier this morning.

First, on behalf of the California Association of Public Hospitals and Health Systems, our systems are facing extreme workforce challenges in addition to what my colleague from CHA mentioned around registered nurses, we're having trouble recruiting certified nursing assistants, medical assistants, clinical lab scientists and technicians, respiratory therapists, behavioral health providers, among others. We are both employers of healthcare workers and major providers of training to the healthcare workforce and essential safety net systems.

We are very supportive of the funding that was provided in the current year to both support and rebuild California's healthcare workforce, and we're hopeful that the administration and legislature continue to prioritize investments in health workforce. Any delays, reductions or trigger cuts to workforce development will negatively impact and further delay the resolution of our ongoing healthcare workforce crisis. Second, on behalf of the Urban Counties of California, workforce remains a top priority for urban counties.

We are struggling to compete with private sector employers to attract and retain workers, especially for some of the most critical services that counties provide, counties and hospitals and clinic system, public health departments, behavioral health agencies and human services agencies. We are very concerned that the proposed delays in workforce funding will hamper the expanded pipeline for this very essential workforce. Thank you.

Thank you very much. Welcome.

Thank you. Good afternoon chair and members. My name is Christoph Mair and I'm a legislative advocate for AFSCME California. In addition to public sector workers, we also represent healthcare workers in the private sector. I'd like to align my comments with those of the representative from Unite Here, urging this body to fund AB 2530 from last year. The vast majority of workers do not want to strike.

When that difficult decision is made, striking workers forego pay to demand better working conditions, respect and dignity. Kust last year, in case you were wondering if this actually happens, AFSCME workers on strike from a dignity hospital were threatened with the revocation of their health care while on an authorized strike. Additionally, AFSCME aligns our comments with Health Access California supporting using revenue from individual mandate penalty to reduce deductibles and copayments for Covered California enrollees. Thank you.

Thank you so much. Welcome.

Good afternoon chair and members. My name is Tiyesha Watts. I'm a legislative and policy advocate with the California Academy of Family Physicians. We are the largest primary care medical society in California, representing over 10,000 family physicians, residents and medical students. We wanted to extend our appreciation thus far for ensuring that access to health care remains a central goal in California.

State budget refraining from making drastic health haircuts is critical for many Californians, especially as we recover from the COVID-19 pandemic, which has had a devastating health and catastrophic economic impact on the most vulnerable residents of our state. As this budget cycle progresses, we ask that you prioritize improving investments in primary care, such as the primary care rate, increase in the budget and continue to invest and maintain funding in the song Brown Primary Care Physician training program.

These investments will improve access to primary care and address California's primary care physician workforce. Lastly, we ask that you continue to maintain the general fund expenditure to expand access to health care, such as expanding full-scope medical eligibility to income-eligible adults ages 26 to 49, regardless of immigration status, as this will ensure that vulnerable populations receive the critical care they deserve. Thank you for your time and consideration and we look forward to working with you throughout this budget cycle.

Thank you for coming. Welcome.

Thank you, Madam Chair and Members. Corey Hashida with the Steinberg Institute. We're an independent, nonprofit public policy institute dedicated to transforming California's mental health and substance use care systems through education, advocacy, accountability and inspired leadership. Commenting on issue number six under HCAI, first, just want to acknowledge the tremendous investment the legislature and the administration made in our healthcare workforce, and in particular our behavioral health workforce in last year's budget.

That said, we, like many others, are concerned about the proposed delays to this workforce funding, given the very pressing need for a strong workforce to implement all of the state's major behavioral health reforms that are underway. And we would encourage the legislature to protect this funding and do all it can to ensure that these dollars get out the door as quickly as possible. Thank you.

Thank you for your comments. Welcome.

Hi, good afternoon, madam chair and members. Beth Malinowski with SEIU California. On behalf of our 700,000 members, I'd like to offer remarks on a number of items. With regards to the agency's budget, Issue number three on CalSAWS, as we roll out the new system, we continue to support our public sector workforce as they make the transition and encourage training in all new CalSAWS functions.

With regards to issue number five on EVV, we look forward to the continued conversations as we implement the next phase of electronic visit verification to ensure a streamlined process for IHSS recipients and providers transitioning to the HCAI budget. With regards to issue number three, we support the BCP to SB 1882 on seismic safety implementation. Additionally, we are deeply concerned with the administration's budget solution, as it is no solution at all with regards to healthcare workforce.

Any workforce funding delays are also delay in the provision of behavioral health services for medical care, be it our healthcare workforce crisis impacting our hospitals or our primary care centers or prevention, we urge rejecting the delays of healthcare workforce funding. Lastly, and on behalf of our private sector workers, we're serving everyone from our airports to our office buildings and hospitals want to second the remarks made by my labor colleagues.

We were also at SEIU, proud supporters and sponsors of AB 2530 and for that policy to be successful, we need funds available to offer enhanced state subsidies when needed for striking workers, and we hope to see that addressed in the Covered California budget. Thank you again for your time.

Thank you so much. Welcome.

Good afternoon, chair members. Janice O'Malley with the American Federation of State County Municipal Employees. You've already heard from my colleague Christoph on one or a couple of items I wanted to touch on the HCAI funding item 4140. To issue three, we support the implementation of AB 1882 to ensure that hospitals in the state continue to work towards being seismically compliant by the year 2030, which hospitals in the state have had decades to achieve.

And seeing the aftermath of the horrific events in Turkey, we cannot afford to continue putting these important upgrades off to the side. So really appreciate you making those comments, Senator Roth. Related to issue four, we agree with the concerns that Senator Roth shared on delaying workforce funding for healthcare workers during the height of the pandemic. Many training programs were put on pause and subsequently some students didn't return, thereby exacerbating the problems with the stability in the recruitment of the workforce.

And we look forward to working with you on supporting the pipeline of this essential workforce. So thank you very much.

Thank you very much. Seeing no more in-person witnesses, Moderator if you would please prompt the individuals waiting to provide public comment, we will begin.

If you would like to make public comment today, please press one, then zero. An operator will provide you with your line number and you will be called on by your line number when it is your turn. Once again, that command is one, then zero. And first we will hear from line 33.

Thank you. Moderator. Can you please give me the total number of people waiting to testify?

Sure. Right now we have 12 people in queue.

Perfect. Open the lines and call the members of the public individually. We will continue.

All right. Line 33, please go ahead.

Good afternoon, Madam Chair and Members. Nicole Wordelman, on behalf of the Children's Partnership, commenting on HCAI issue six related to workforce delays. The Children's Partnership requests that funding delays for the training and certification of community health workers be rejected. Delaying this investment will disrupt broader efforts to achieve significant improvements in medical, clinical and health equity outcomes that the state has committed to achieving by 2025.

The state has embarked on initiatives meant to address health inequities impacting children and families enrolled in medical that were highlighted by the State Auditor in 2018 and 2022, including closing racial and ethnic disparities in well child visits and immunizations by 50 percent, closing maternity care disparity for black and Native American persons by 50 percent, improving follow up for mental health and substance use disorder by 50 percent and ensuring all health plans exceed the 50th percentile for all children's preventive care measures.

A key strategy to address these health inequities includes integrating community health workers into our state's MediCal system, where CHW will be able to provide preventive services like outreach, navigation, education and advocacy services critical to achieving those goals by 2025. Delaying this investment will counter California's efforts to achieve health equity in MediCal and as such, we request that the Legislature reject funding delays for CHWS. Thank you.

Next, line 51.

Hi, I'm Darby Kernan representing Leading Age California. Leading Age California is an advocate for quality, nonprofit older adult living and care. I'm commenting today on the workforce delays. We represent more than 700 organizations across California who rely on nurses and social workers to allow older adults and those with disabilities to remain in a home and community-based service setting. These providers are on the front lines and are experiencing the devastating healthcare worker crisis firsthand.

We agree with both chair Menjivar and Senator Roth on working to preserve the workforce, education and training programs, specifically with regards to the nursing initiative funding. This is something that's going to help the state continue move forward and protect our health care system. Thank you.

Thank you, next caller?

Line 52.

Good afternoon. Linda Nguy with Western Center on Law and Poverty. We share the chair's concern with the proposal to sweep the Covered California Affordability Assistance in the general fund and appreciate the thorough staff analysis.

When the reinstatement of the individual mandate penalty was discussed in 2019, we argued this should only be done with additional affordability assistance due to data that showed a large number of low income individuals were paying the penalty and continue to believe that these funds should go to lower health care costs for those who need affordability assistance.

In addition, we support the BCP for permanent staffing for policy oversight over CalWIN and recommend the staff be used to do more to ensure CalWIN complies with state policy related to language access, sufficiency of notices, and timely program. Finally, as co-sponsors of SB 923 related to access to gender-affirming care, we support this BCP as well as SB 858 related to health plan penalties. Thank you.

Thank you, next caller.

Line 54.

Hello, this is Kevan Insko with the Friends Committee on Legislation of California asking you to address affordability as a barrier to health care, particularly by reducing Covered California deductibles and copays for low and middle-income Californians. Thank you.

Thank you, next caller?

Line 53.

Thank you, Madam Chair. Eduardo Martinez, on behalf of Ultimate Health Services, offering comments related to the healthcare workforce delays. Ultimate community health centers provide high-quality, comprehensive care to more than 500,000 Californians and have been a trusted healthcare provider for Latino, multiethnic and underserved communities in Southern California for over 50 years. As we know, California has made major strides in the expansion of MediCal for the remaining uninsured.

However, in order to fully achieve health care for all, further investments in our healthcare workforce and pipeline programs must continue to guarantee access to high quality cultural and linguistically competent care and to address the state's most pressing health disparities. Ultimate urges the legislature to address the governor's proposed delayed healthcare workforce funding allocations in the budget and provide additional investments for cultural and linguistically competent care at all levels of California's healthcare workforce. I wanted to especially thank Senator Roth and the chair for your comments about this proposal.

We couldn't agree more and we look forward to working with you on this issue. Thank you.

Line 58.

Thank you, next caller?

Thank you, Madam Chair and Senators, Amer Rashid with the County Behavioral Health Directors Association of California. CBHDA respectfully requests that the Legislature reject the proposed delays in the behavioral health and social workforce funding in the governor's budget.

Specifically, the proposals to delay 52 million of university and college grants for behavioral health training programs and 30 million for schools of social work, are detrimental to current efforts to recruit and retain qualified behavioral health workers to meet the growing demands of our state. Workforce funding delays will jeopardize California's ability to obtain behavioral health services at a time when numerous statewide initiatives are intended to increase access.

CBHDA has also released, along with a number of partners, a needs assessment, which was released on February 13 of 2023, and we look forward to sharing more details with you all in the future, which I think will underscore this incredible need to ensure that workforce funding delays do not occur in this budget. Thank you so much for your time.

Thank you, next caller?

Line 55.

Good afternoon. This is Rebecca Gonzales of the National Association of Social Workers, California chapter. We represent professional social workers with a degree in social work. We're also talking about the workforce delays today, and we are very concerned about the delay of that money for the expansion of MSW spots at schools of social work, and we will be meeting with HCAI next week to discuss these issues. We would like to ensure that funding delays will not stop the progress already made in program expansions.

And we would like to thank the committee for your commitment to the social work workforce, especially the comments by Senator Roth and Senator Menjivar for your comments on the behavioral health workforce. But, we also want to point out that social workers support many different systems that utilize the expertise of social workers, such as Child Welfare Services and Adult Protective Services, which shows the need for graduating more social workers.

The second item I want to talk about is about Covered California want to join others who are concerned about the barrier posed by the deductibles and copays and that we support these systems so that people can afford to have health care. Thank you.

Thank you, Rebecca. Next caller?

Line 59.

Andrea Rivera with the California Pan-Ethnic Health Network, here to comment on item 4800 related to Covered California. Affordability remains a significant barrier to Californians accessing the health care they need when they need it. With deductibles of almost $5,000 and copays for primary care visits around $50, it's not surprising that many low income and middle-income Californians opt to delay care simply due to cost.

The administration and the legislature must act now, and we urge the Legislature to reject the redirection of the individual mandate penalty revenue to the general fund and continue to use those funds to make Covered California more affordable. Communities of color are urging the state to provide them with assistance and help them afford coverage and care. Thank you.

Thank you, next caller?

Line 57.

Good afternoon. Ronald Coleman Baeza, here with California Pan-Ethnic Health Network CPEN on HCAI issue six. We are disappointed by the governor's proposal to delay funds to recruit, train and certify 25,000 new community health workers and promoters by 2025. These funds are critical to building a robust, culturally and linguistically responsive workforce that can meet the needs of California's diverse populations, which also now includes MediCal beneficiaries who now have this benefit.

If the delay of funds is approved, we urge that a percentage of funds be set aside for planning purposes so there can be a public process that includes CHWs and promotoris to determine how these funds will be spent in future budget years. But we strongly urge the Legislature to reject this delay. On CalHHS issue eight on equity-centered programs, we support the transfer of the retrospective analysis to DHOAG. However, CPEN is also disappointed to not see the work move forward.

CalHHS was also tasked with language access enhancements across the agency, staff training and other projects as part of the equity centered programs that passed in the 2021 budget cycle. And we encourage the Legislature to get a status update on the remainder of that work. Thank you.

Thank you, next caller?

Line 56.

Madam Chair, Senator Roth, this is Toni Trigueiro. On behalf of the California Teachers Association regarding the workforce expansion, we have a different issue with regard to HCAI. We would like them to increase the number or make eligible pupil service personnel in their workforce expansion efforts. These are individuals who are school nurses, social workers, psychologists, and counselors that have CTC-issued credentials. They currently fund scholarships for nurse anesthesias and psychiatric nurses, but not credentialed school employees, like I mentioned, nurses, psychologists, social workers, and counselors.

And in anticipation of future hearings on HCAI, we continue to express concerns around the viability of HCAI's wellness coaches, 1 and 2, and the expectation of their introduction onto school sites without resolution of the issues of their services being reimbursable. We look forward to working with the committee to resolve these issues. Thanks very much.

Line 11.

Thank you so much. Next caller?

Thank you. Madam Chair and Committee Members, my name is Garrett Chan, and I am the CEO of HealthImpact, the California Nursing Workforce and Policy Center, and a nonprofit organization. I'm also a nurse that's still in practice. HealthImpact provides programs to support the development of the nursing workforce in California, and I would like to comment on the workforce budget delays of item 4140 issue six. We appreciate the LAO's analysis on the health workforce budget solutions.

There are a few key issues that were not included in the analysis that I'd like to highlight for the Senate Budget Subcommitee for consideration. First, the governor has promised to advance universal access to health care through medical, and in October 2022, he announced that roughly 286,000 older adult Californians were receiving full scope medical as a result of this expansion. We need more health providers educated and prepared to care for the increased number of employees.

Second, across the country, and especially in California, we are seeing nurses and other healthcare professionals leaving direct care physicians in massive numbers due to moral injury and burnout. Many of my colleagues I personally know from across the state have left direct care practice. So while we may have the number of licensees available, as the LAO states, they're not in direct care practices.

Third, as Madam Chairman Menjivar and Senator Ross have noted, the time horizon for educating nurses is at least four years, and for other health professionals, it can take up to eight to nine years. Dr. Joanne Spetz at the UCSF Health Force Center found that we are going to have a deficit of approximately 40,000 RNs from now until 2026. And lastly, the greatest number of professionals who leave the profession will leave within the first two years of practice.

So we need to help increase the number of transition of practice or postgraduate apprenticeship programs to keep these highly educated new professionals in the profession. Delaying in funding for healthcare workforce programs will prolong the workforce shortage crisis that we find ourselves in today. With the increased interest in healthcare for all, we need all the professionals we can educate and retain in the workforce to provide the needed access to care.

HCAI has been doing a fantastic job working with the community based organizations to address this healthcare workforce crisis. Thank you for the opportunity to speak today.

Thank you, next caller?

Line 61.

Hello, Madam Chair and Members, Sara Flocks from the California Labor Federation. And we are also one of the proud sponsors of AB 2530, the bill that was signed into law last year to ensure that no worker who exercises their legal right to strike will ever lose access to health coverage. We would urge the Legislature to dund that Bill by appropriating funding for the financial assistance to Covered California to cover workers who do lose their coverage in the event of a strike.

And we think this is so incredibly important because California has made great strides to ensure that every Californian has access to affordable health coverage and has also been a leader in protecting workers rights, including the right to strike. And both of those values are embodied in AB 2530. And so we hope that that appropriation will be made. Thank you so much.

Thank you, next caller?

Line 62.

Good afternoon, buenas tardes, my name is Israel Villa with the California Alliance for Youth and Community Justice, calling to speak on agenda item one and a few things concerns that I heard and calling to speak truth and clarity to some of this. Starting with a mention of the California Conservation Corp. And Pine Grove being a community-based alternative. That is not true, that is not accurate, and that is not what our children need when we talk about community-based alternatives.

I also heard representative from CPAC mention the JJCPA funding stream, which I know from research. Almost at least 90 percent of it is going solely to salaries and benefits, not going to help our kids. It's going to sustain this extremely large infrastructure that they are trying hard to maintain from decades ago. I also heard references of trauma-informed responses and positive youth development. And my main point is I understand and I often hear system stakeholders use language such as evidence-based programs, so on and so forth.

And my issue is where is the evidence of this trauma informed responses and positive use development? Because everything that we hear and see and know is a bunch of bad things that are happening currently up and down the state. And my ask is when is the data going to come? Because there is very little to no data. And they're big on mentioning database decisions. But yet, we also know from hearing from system stakeholders that most of these counties do not have adequate infrastructure for data.

So again, there is no data to back up, nothing that they're saying. And unfortunately, this opportunity to transition from a punishment model to a health based model, it seems like it is going in a very bad decision. It's not going in the right direction. It seems very much like they're maintaining the same old, outside of the words that they share in practice and policy, it's the same. And that's all. Thank you.

Thank you so much for your comments, next caller?

Line 64.

Hey there, my name is Bianca. I'm policy director for an organization called Small Business Majority. We advocate for very small business owners to be able to provide quality jobs to roughly half of America's private sector workforce.

Recognizing the important role that Covered California plays in ensuring that small business owners are able to provide these quality jobs, we want to urge the committee to ensure that affordability remains a significant part of California's policy agenda and ensuring that the deductibles that consumers pay an amount, almost $5,000 in copays for primary care visits around $50. Many low and middle-income Californians, including small business owners, delay much-needed care.

And so as the administration collects hundreds of millions of dollars from uninsured Californians that are currently in the Healthcare Affordability Reserve Fund, we hope that these funds will be used to ensure that healthcare in California continues to remain affordable. Thank you so much.

Thank you, next caller?

Madam Chair, there are no further comments at this time.

Thank you, Moderator. Having heard from all the members of the public, I turn to my Senator on the right. Do you have any additional questions or comments to close out? Thank you. Thank you to all the individuals who participated in public testimony today. If you were not able to testify, please remember, you can still submit your comments or suggestions in writing to the budget and fiscal review committee or visit our website.

Your comments and suggestions are really important to us, and we want to include your testimony in the official hearing records. Thank you. We appreciate your participation. We have concluded the agenda for today's hearing. The Senate budget subcommitee number three on health and human services business is adjourned.