Summary of AB 104 and SB 74 – 2011-12 Trailer Bills

Summary of AB 104 and SB 74 – 2011-12 Trailer Bills

AB 104 is the trailer bill that outlines the changes to Developmental Services for this year's budget including the full-day/half-day billing requirements, SLS changes and annual family fee. Governor Brown signed AB 104 into law on June 30. The full text of the bill is here (33 pages) http://www.leginfo.ca.gov/pub/11-12/bill/asm/ab_0101-0150/ab_104_bill_20110630_chaptered.pdf

Key components of AB 104 are:

Electronic Billing (Sections 2 and 7)

Beginning July 1, 2011, RC’s are to transfer all providers , including providers of early intervention services to e-Billing, to be completed by July 1, 2012.

The Prevention Program is phased out and DDS is required to create a program for at-risk babies. (Sections 5 and 6)

At-risk babies are not to be referred to the program, effective July 1, 2011.
RC’s have to continue serving Prevention Program consumers until they either reach 36 months, are determined eligible for Early Start services, or June 30, 2012.
Effective July 1, 2011, RC’s are to refer at-risk babies to the Family Resource Center.

IPP’s are to include a Transportation Access Plan (Section 10):

When RC’s are purchasing private, specialized transportation services, or services from a residential, day or other provider – excluding vouchered service providers – to transport consumers to & from day or work services.

When the planning team has determined that a consumer’s community integration and participation could be safer or enhanced through the use of public transportation services.
When the planning team has determined that generic transportation services are available AND accessible.

Community Care Facilities and Mixed Rates (Section 14)

In order to maintain a consumer’s preferred living arrangement, a RC may enter into an agreement with a residential service provider for a consumer’s needs to be met at a lower level of payment than the facility’s designated ARM service level.

Senior and Alternative Customized Programs (Sections 17 and 18)

Effective July 1, 2011, RC’s are no longer to refer consumers to these programs.

Tailored Day Services and Vouchered Community Based Training Services (Section 19)

Establishes Tailored Day Services which allows consumers flexibility in the duration and intensity of services to meet their individual needs.
Establishes the use of vouchers for consumer directed services that assist the consumer in the development of skills required for community-integrated employment, or participation in volunteer activities. The rate for this service shall not exceed $13.47 per hour and does not include the cost of the Financial Management Service (FMS) consumers, parents or guardians vendored for the voucher are required to use.

Supported Living Services Shared Services and Independent Assessments (Section 20)

The IPP for SLS consumers sharing a household with another person receiving SLS will consider sharing like services where one service provider can provide a service for both SLS consumers at the same time.
Effective July 1, 2011 - An independent assessment is required for consumers entering supported living with an initial recommendation for service costs that exceed 125% of the annual statewide average cost of SLS services.
Effective July 1, 2011 – An independent assessments of a consumer’s SLS needs are required for anyone who has SLS expenditures over 125% of the statewide average for SLS.

Full-Day and Half-Day Billing for Day Programs with a Daily Rate (Section 21)

When consumers’ attendance is less than 65% of a program’s “normal” day, day program providers will only bill for a half-day. A “full day” of service is a day in which the consumer’s attendance is at least 65% of the approved program day.

Annual Family Program Fee (Section 23)

Families with children under the age of 18 receiving services will be assessed a fee of $200 or $150 per family, based on the family’s adjusted gross income level.
RC’s will assess and collect the fees.
Services cannot be delayed or denied based upon lack of payment of the annual family program fee.

4.25% Payment Reduction Expansion (Section 24)
The “Usual and Customary” rate exception no longer applies to the following types of vendors:
Crisis & Behavioral services provided by nationally certified or state-licensed professional, consistent with the professional’s scope of practice.
Services of group practices providing behavioral intervention.
Parent-coordinator home-based behavioral intervention for children with autism.
Individual or family training.
Registered nurse services.
Therapy services including physical, speech, occupational, recreational and music therapy.
Audiology services.
Independent living specialist services.
Translator and interpreter services.
Mobility training, socialization training, or community integration training services.
Community activities support, program support, or parenting support services.
Personal assistance services.
Tutoring services.
Creative Arts services.
Early Start specialized therapeutic services.

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SB 74 was the trailer bill passed in March as part of the $7.4 billion in cuts legislators approved early in this year’s budget process. This bill included the “best practices” stakeholder process, audit and administrative spending requirements for vendors and RC’s, and extends the 4.25% rate reduction to June 30, 2012. The full text of the bill is here: (27 pages) http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_0051-0100/sb_74_bill_20110324_chaptered.pdf

Key components of SB 74 are:

Regional Center Accountability and Transparency (Sections 3 and 7)
RC boards are required to review and approve any contract of $250,000 or more. Contracts do not include vendor approval letters issued by RC’s pursuant to Section 54322 of Title 17 of the California Code of Regulations.
RC’s are required to provide upon request:
Information regarding requests for proposals and contract awards.
Service provider rates.
Documentation related to the establishment of negotiated rates.
Audits and IRS Form 990
RC’s must post the following on their website:
RC independent and fiscal audits, annual reports, board meeting agendas and minutes, governing board bylaws, conflict of interest policy, annual performance contracts, the HCBS Waiver program review, and their transparency and public information policy.
Contract awards, including who got the contract, the amount and the purpose.
Purchase of Service Policies.
The names, types of service, and contact information of all vendors, except consumers or family members of consumers.

Administrative Cost Caps (Section 8)

No more than 15% of the funds received from RC’s by a provider with negotiated rates can be used for administrative costs.
No more than 15% of the RC Operations budget can be spent on administrative costs.
Funds spent on “direct services” – including, but not limited to service coordination, assessment and diagnosis, monitoring of consumer services, quality assurance and clinical services – shall not include any administrative costs.
Specifies expenditures for both the RC’s and providers that are considered “administrative” including:

Salaries, wages and employee benefits for managerial personnel and non-direct service employees.
Facility and occupancy costs directly associated with administrative functions.
Maintenance and repair.
Data processing and computer services.
Contract and procurement activities, except those performed by direct service employees.
Travel, training and licenses directly associated with administrative functions.
Taxes and interest.
Property and personal liability insurance directly associated with administrative functions.
Depreciation.
General expenses, including, but not limited to, communication costs and supplies directly associated with administrative functions.

Accountability and Transparency for Providers (Section 11)

Requires RC’s to collect specific information regarding vendors to ensure HCBS Waiver reimbursement eligibility. Disclosure requirements will include information about entity ownership and control, contracting interests, and criminal convictions or civil proceedings involving fraud or abuse in government programs, or abuse or neglect of an elder, dependant adult or child. Individuals and entities with certain criminal convictions will be barred from being RC vendors.

Provider Audits (Section 13)

Requires entities receiving payments exceeding $250,000 from 1 or more RC’s to contract with an independent accounting firm for an audit or review of its financial statements that will be submitted to the vendoring RC.
Requires RC’s to review these audits and follow up on any issues identified in the reports.