Legislative Analyst's Office, December 2000

LAO
Recommended
Legislation
Health/Social Services

Medi-Cal and Healthy Families Programs

Expand and Restructure Family Health Care Coverage

Recommendation

Combine and restructure the state's Medi-Cal and Healthy Families health care programs to provide coverage to families with incomes up to 250 percent of the poverty level. Approximately 770,000 additional persons would obtain health coverage under this proposal at an annual state cost of about $200 million, when fully implemented.

Rationale

We have developed a "Family Coverage Model" that (1) combines and unifies family coverage under the Medi-Cal and Healthy Families programs and (2) includes an innovative "buy-in" approach that lets uninsured low-income families participate in employer coverage at a reasonable cost. The model maximizes available federal funding, achieves significant administrative savings by simplifying eligibility, and it minimizes "crowd-out"the replacement of private coverage with public coverage.

LAO Reference

Please see our June 1999 report, A Model for Health Coverage of Low-Income Families. (The coverage and cost figures cited above have been updated and adjusted to account for eligibility changes enacted subsequent to the report.)

LAO Contact

Farra Bracht: 445-6061

Managed Risk Medical Insurance Board

Require CCS Children to Enroll in Healthy Families Program

Recommendation

Require qualifying participants in the California Children's Services (CCS) program to enroll in the Healthy Families Program.

Rationale

Currently, the state and the counties equally share the cost of providing medical services to eligible children in the CCS program who do not quality for Medi-Cal. Enrollment in Healthy Families would provide these children with coverage for a broader range of services, including dental and vision care, and would result in state and county savings by shifting two-thirds of the cost of such services to federal funds. Requiring enrollment in Healthy Families for qualifying CCS children (rather than relying on gradual voluntary enrollment) would maximize this coverage and result in annual net state and county savings.

LAO Reference

Please see our 1998-99 Analysis, page C-20.

LAO Contact

Greg Jolivette: 445-6061

Department of Health Services

Ensure That Immunization Registry System Is Effective

Recommendation

Require local immunization registries to comply with the state's guidelines for local registry development. Require all immunization providers to participate in local registries. Provide a state match for local registries' ongoing costs in order to encourage the continuation of local participation in the statewide immunization information system. Require the Department of Health Services to apply for federal matching funds for the development and operation of the statewide immunization information system.

Rationale

A statewide immunization information system is in its planning stages. In order to be effective, the system will require more coordination of local immunization registries, as well as an assurance of provider participation. State matching funds would help maintain this system and improve childhood immunization rates.

LAO Reference

Please see our 2000-01 Analysis, page C-89.

LAO Contact

Greg Jolivette: 445-6061

Department of Health Services

Improve Test Reliability at Clinical Laboratories

Recommendation

Require physician office laboratories (POLs) to have at least one licensed clinical laboratory technologist when conducting moderate- or high-complexity tests.

Rationale

A 1997 study of the reliability of lab test results found that POLs using unlicensed personnel to conduct moderate- and high-complexity tests had a failure rate more than twice that of POLs using licensed laboratory technologists. This recommendation is consistent with current law that requires non-POL labs to use licensed technologists for all such tests.

LAO Contact

Greg Jolivette: 445-6061

Medi-Cal Program

Require Regional Clearinghouses for Nursing Home Placements

Recommendation

Require the use of regional nursing bed clearinghouses to facilitate the transfer of Medi-Cal patients needing only nursing care from hospitals to less costly freestanding nursing facilities.

Rationale

Current law requires hospitals to individually contact nursing homes during regular workdays to seek placements for Medi-Cal patients who no longer require hospital care, but who do need nursing care. If an appropriate outside placement is not located, then the patient may remain in a hospital-based nursing bed.

Use of regional clearinghouses, which would maintain a central database of available nursing beds, would simplify and expedite the placement process, reduce hospital administrative costs, and allow the department to easily verify compliance with the placement process. State savings could be up to several million dollars annually.

LAO Reference

Please see our 1997-98 Analysis, page C-50.

LAO Contact

Tiffany Reyes: 445-6061

CalWORKs

Evaluate Work Participation Standards

Recommendation

Require the department to contract for an evaluation of the cost-effectiveness of giving counties the discretion to reduce required weekly hours of participation from 32 hours to 20 hours for families with a child under age six.

Rationale

Federal law requires that single-parent families with children under age six participate in work-related activities for a minimum of 20-hours per week. Beginning in 1999, current state law set the minimum participation requirement at 32 hours for all single-parent families. Given the high cost of child care for preschool-aged children, providing county case managers with the flexibility to set participation standards for families with young children between the federal minimum (20-hours per week) and the California Work Opportunity and Responsibility to Kids (CalWORKs) program minimum (32-hours per week) could facilitate cost-effective use of CalWORKs resources. (We note that subsequent to publication of our report, nine counties have indicated an interest in participating in such an evaluation.)

LAO Reference

Please see CalWORKs Welfare Reform: Major Provisions and Issues (January 1998), page 20.

LAO Contact

Kasia O'Neill: 445-6442

CalWORKs

Expand CalWORKs Community Service

Recommendation

In order to better use community service as a bridge to nonsubsidized employment, allow counties to use private for-profit organizations as community service employers.

Rationale

California Work Opportunity and Responsibility to Kids (CalWORKs) recipients must begin community service after two years on aid if they have not found a job. Under current law, such community service must be performed in the public and private nonprofit sectors. Excluding the for-profit private sector from participating in community service employment, however, (1) significantly reduces the number of potential employers and (2) increases the difficulty of finding high-quality work slots, particularly in jobs that might closely resemble those in the private sector.

LAO Reference

Please see CalWORKs Community Service, What Does It Mean for California? (February 1999), page 18.

LAO Contact

Kasia O'Neill: 445-6442

In-Home Supportive Services

Standardize Payment Methods

Recommendation

Eliminate the "advance pay" option in the In-Home Supportive Services (IHSS) program.

Rationale

There are approximately 940 cases in an average month--less than 1 percent of the total IHSS caseload--in which payments for services are sent to the recipient at the beginning of each month, before services are rendered. State law authorizes this method of payment for severely impaired recipients. These advance pay cases, however, are not eligible for federal funding.

Elimination of the advance pay option would not reduce the level of services to recipients. It would require that all payments be made to the service provider on an arrears basis, which is how almost all IHSS cases are paid. Eliminating the advance pay option will save the state approximately $2 million annually by making these cases eligible for federal funding.

LAO Reference

Please see our 1995-96 Analysis, page C-147.

LAO Contact

Todd Bland: 445-6442

California Children and Families Commission

Matching Grant Program for Proposition 10 Funds

Recommendation

Establish a state-funded voluntary matching grant program for the Proposition 10 county commissions, which would fund (1) early childhood programs that have been shown to be cost-effective and/or (2) demonstration programs that are potentially cost-effective, based on existing research.

Rationale

Proposition 10 provides county commissions with a significant increase in funding for programs related to early childhood development. The Legislature has no direct control over the expenditure of Proposition 10 funds, but does have an opportunity to influence decisions taken by the state and, more importantly, the county commissions. A variety of early childhood programs, typically small-scale demonstration programs, have been evaluated as being effective according to outcome measures such as school achievement and health status. Enacting a matching grant program would create a fiscal incentive to encourage the county commissions to use their funds productively.

LAO Reference

Please see Proposition 10: How Does it Work? What Role Should the Legislature Play in Its Implementation? (January 1999).

LAO Contact

Mary Adèr: 445-6442


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