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Last Updated: 5/29/2013
Budget Issue: Maximizing federal funding for parolee mental health care
Program: Department of Corrections and Rehabilitation
Finding or Recommendation: Adopt budget trailer bill legislation directing CDCR--in collaboration with DHCS--to (1) expand Medi-Cal application assistance to parolees receiving mental health treatment, (2) implement a process for claiming federal reimbursement for staff that is assisting inmates with Medi-Cal applications, and (3) take steps neccessary to claim federal reimbursement for parolee mental health treatment.
Further Detail

Historically, the state has spent tens of millions of dollars annually from the General Fund for the California Department of Corrections and Rehabilitation (CDCR) to provide mental health treatment services to mentally ill parolees. Our analysis indicates that federal Medicaid reimbursements could be attained for some of the costs of these existing services. Moreover, the amount of federal reimbursements could increase significantly under the federal Patient Protection and Affordable Care Act (ACA) if the Legislature chooses to expand Medi-Cal to provide health coverage to most low-income individuals, as authorized by ACA.

In order to maximize the federal reimbursements that will be available for parolee mental health treatment, especially if the state expands Medi-Cal eligibility, we recommend that CDCR (1) provide increased Medi-Cal application assistance for mentally ill parolees to ensure that all eligible parolees are enrolled, (2) develop a process—in collaboration with the Department of Health Care Services (DHCS)—to claim federal reimbursement for the costs of assisting inmates with benefits applications, and (3) develop a process—in collaboration with DHCS—to claim federal reimbursement for parolee mental health treatment services provided to parolees. If the state took these steps, we estimate it could achieve net General Fund savings of about $6 million in 2013-14 and $28 million annually upon full implementation in 2014-15 (assuming the state implements the Medi-Cal expansion).

For more information please see our recent report The 2013-14 Budget: Maximizing Federal Reimbursement for Parolee Mental Health Care.