California Health Report | HealthyCal - Part 20
 

California Health Report

  

March budget cuts rolling out now

Published: June 23, 2011 | No Comments

By Michael Gardner

Millions of Californians will see smaller aid checks, fewer services and higher costs as painful budget cuts ripple across every corner of the state in the coming weeks.

The steep reductions were approved by Gov. Jerry Brown and lawmakers in March as part of their bid to get a head start on taming a $25.4 billion deficit in time for the start of the fiscal year July 1.

Three months later, those actions have been overshadowed by the latest impasse over how to close the remaining gap of nearly $10 billion.

But many of the cuts approved earlier are just beginning to take effect now.

Donna Pomerantz says she can give you at least a thousand reasons why the Legislature should resist scaling back even more.

That’s how many sight-impaired members she represents as president of the California Council of the Blind. The March action dropped aid checks to the blind, disabled and needy elderly by $15.

“This is about survival — not luxuries,” said Pomerantz, who lives in the Los Angeles area.

And now they are at risk of more cuts.

That’s because Brown and lawmakers remain tangled in knotty budget talks, unable to find common ground over whether to extend temporary tax increases, cut back on public employee pensions and adopt a spending cap, among other issues.

They are trying to balance a budget that still spends more than it takes in, even after carving out about $11 billion in March. At the time, the general fund stood at $84.6 billion.

Brown last week vetoed one stab by Democrats that included mostly fee increases, fund shifts and accounting maneuvers. Democrats chose that route because

Republicans oppose an extension of personal income, sales and vehicle taxes.

On Monday, the still-stunned leader of the Senate Democrats said he will resist as many fresh cuts as possible.

“We all want fiscal balance, but at what price?” said Sen. Darrell Steinberg, D-Sacramento.

The price, those in need say, could very well be an acceleration of their fiscal woes that have persisted since March.

“More is coming. that’s what we’re told,” said Pomerantz. That means less money to buy food, fewer doctor’s visits and a loss of in-home aides, she said.

Health and welfare programs absorbed the brunt of the cuts imposed three months ago. And advocates anticipate more reductions in the latest round.

“A lot of it is waiting on pins and needles for finality,” said Gary Rotto, director of health policy for the Council of Community Clinics serving San Diego, Riverside and Imperial Counties.

His organization has a network of about 100 clinics serving 650,000 individuals in the three counties.

Not all of the fiscal diet is in place. Many decisions are being phased in, as required notification periods wind down. In some instances, the state must secure federal permission before slashing some health and welfare programs.

Nevertheless, the March cuts will be in place for 2011-2012.

Statewide, the March budget slimmed Medi-Cal services by $1.5 billion, affecting the health care coverage of 7.7 million Californians. Among the changes: co-payments for everything from routine checkups ($5), to emergency room visits ($50) to hospital stays ($100 a day — maximum of $200).

“All of this for people who earn less than $900 a month,” said Anthony Wright, executive director of Health Access, which advocates for medical care for the needy.

Welfare spending will fall by $1 billion, much of it generated by a direct 8 percent reduction in monthly aid, to $638 from $694 for the average family of three.

The state also will stop sending checks to those on welfare for more than four years, a 12-month drop in eligibility from the current 60 months.
State supplemental security payments will also shrivel. Many of those checks go to the blind, disabled and poor elderly to get by. To save about $178 million, the March budget deal cuts the monthly allocations by $15, to $830.

Social services are not the only programs slashed.

Whether K-12 schools are technically being “cut” is a perennial source of debate. According to the nonpartisan Legislative Analysts Office, the Legislature has kept “flat” the minimum level of revenues dictated by law in Proposition 98.

However, the guarantee is predicated on the amount of money in a general fund depleted by the sour economy. As a result, schools have not seen increases they had expected. Additionally, lawmakers have deferred making full payments on time, forcing many districts to borrow money to meet their obligations in the short term. More importantly, special federal grant moneys are drying up, exacerbating the fiscal crunch.

Colleges and universities, meanwhile, are scrambling to cover March’s combined $1 billion in cuts by raising fees, laying off workers and not filling vacant positions, the systems report. The budget vetoed June 15 proposed slicing anther $300 combined from the two systems.

State workers were not spared. They are required to pay at least 3 percent more of their salary toward their pensions. The state workforce is also supposed to shrink by 5,500 positions.

 

Napa moves against elder care abuse

Published: June 23, 2011 | 1 Comment

By Meda Freeman

With reports of elder abuse rising, Napa County is taking the lead in protecting seniors from unscrupulous or predatory caregivers by becoming the first in California to require criminal background checks for home-care aides.

Starting July 1, in-home assistants who help elderly or disabled adults with bathing, dressing and other daily tasks will need to pass background screenings and buy annual permits to work anywhere in the county. Local law enforcement officials and senior advocates say the new law will arm vulnerable consumers with crucial information and help close an alarming gap in the oversight of California’s private-care industry.


This article is one in an occasional series on aging with dignity, independent living and public policy that affects both. For a complete archive of the articles, click here.


“This ordinance will save lives,” said Napa County District Attorney Gary Lieberstein, who refers to the fatal stabbing of a 70-year-old paraplegic woman in Pleasant Hill last year as an extreme but real example of the risk elderly and disabled people take when they take strangers into their homes.

Lieberstein said Mary Jane Scanlon hired Diane Warrick through a Craigslist post, unaware her new helper’s experience included taking hostages in Napa County, battling police in a shoot-out and then spending four years in a state hospital for the 1997 stand-off.

If Warrick’s violent history had been exposed during a background check, “no one in their right mind would have hired her,” Lieberstein said. Instead, Scanlon let Warrick move into her home, and six months later, Warrick stabbed her defenseless boss in the chest. Warrick was convicted of second-degree murder in March and sentenced to 31 years to life in prison.

Elder abuse is a label that applies not only to violent crimes but also to property crimes like theft and forgery and psychological abuse like coercion and intimidation. Experts say the prevalence of elder abuse in California is difficult to quantify because it often goes unnoticed or unreported, and when abuse is alleged, any number of law enforcement or social service agencies might investigate, depending on the nature or setting of the report.

“We’re certainly getting increased reports of abuse, but whether that’s an increase in awareness or an increase in the problem, we don’t have a way of knowing,” said Lisa Nerenberg, chairwoman of the California Elder Justice Workgroup, which advocates for stronger reporting and support services. “And not only are we seeing more cases, we’re seeing cases of more complicated abuse.”

The issue of elder abuse is only expected to grow as baby boomers age. California’s senior population will double to about 6.4 million by 2025, with the majority of boomers hitting their 80s around 2030, according to government projections. As a result, home care for the elderly is one of the fastest-growing job markets.

“Caregiver Roulette,” a recent investigative report by the California Senate Office of Oversight and Outcomes, explains California does regulate nursing care in private homes but is among a minority of states without regulations for the agencies and individuals who provide help with grooming and day-to-day chores. A business license is all that is required of the private agencies that place these caregivers in homes.

The report describes how dependent adults were swindled out of their savings or otherwise victimized by personal helpers with criminal records never disclosed to their elderly employers. When Principal Consultant John Hill investigated Craigslist ads posted by helpful-sounding caregivers he found some of their backgrounds included embezzlement, methamphetamine sales, child abuse, theft, battery, prostitution and other activities a potential client would want to know about.

According to the report, there is a state law that lets the elderly or disabled request a Department of Justice background check on a potential caregiver, but the law has not been widely publicized and there is no clear system for helping the public make the request or interpret the results.

Oversight Office investigators recommend the Legislature consider passing a law regulating home care, creating a statewide family-care registry and establishing more consistent standards for background checks conducted by private agencies.

Lawmakers introduced two bills this year to close the current regulatory gap. The state Senate recently approved SB 411 by Senator Curren Price, D-Los Angeles, which would require licensure and accreditation for in-home care agencies and criminal background checks and state certification for providers. An Assembly committee is now reviewing the bill. The other bill – AB 899 by Assemblywoman Mariko Yamada, D-Davis – would require licensure of home-care agencies and background screenings for caregivers, but this bill is on hold in the Assembly appropriations committee.

Lieberstein, Napa’s prosecutor, said that until there is statewide oversight, other local governments also might be motivated to enact caregiver ordinances.
“Prevention starts at home, and we weren’t willing to sit around and wait for a state law to be passed,” he said.

Napa’s Board of Supervisors and each city council adopted a caregiver ordinance with identical provisions, so home aides from St. Helena to American Canyon are subject to the same requirements. They will need to apply for a $20 permit through the Napa-Solano Area Agency on Agency and pay a $90 fee for their first background check. The permit will be good for one year only, and background checks will be required every year at renewal.

Representatives of the state’s largest union of home-care aides said members support increased oversight but would prefer any new requirements be statewide. .
“While we appreciate efforts on all levels to establish standards of work and care, we feel like an individual county approach is not the best way forward,” said Laphonza Butler, president of SEIU’s United Long Term Care Workers of Northern California. “The state should establish one standard so the industry can be clear.”

Joe Hafkenschiel, president of California Health Services at Home, another association of caregivers, agrees. “The problem I see in doing it on a county by county basis is we could have different requirements in different counties. I think it’s better to do it on a statewide basis.”

Napa County, meanwhile, has launched a marketing campaign to raise awareness of its new law, and outreach includes a YouTube dramatization of caregiver-hiring gone bad. Officials say the goal is to educate residents about this new safeguard, not to round up unlicensed caregivers.

“We’re getting the word out that people are supposed to see the caregiver’s permit, and if they don’t have a permit, it’s a red flag,” Lieberstein said.

Ruth Marsh of Napa said a vetting process for home aides would have been a big help when she needed a caregiver for her mother. Marsh ended up hiring someone referred by a clerk at the supermarket and soon noticed antiques and other valuables disappearing from her mom’s home. The caregiver denied taking the items, but Marsh eventually fired her.

“She cried, ‘I love your mom so much. I’d never do something like that.’ She was a good actor.”

 

AB 52 would regulate insurance rates

Published: June 22, 2011 | Comments (4)

By Matt Perry

As health insurance premiums continue to escalate, consumer groups and patient advocates are asking the California Legislature to regulate the price of coverage. Yet outspoken opponents — including health insurers, doctors and hospitals — claim that rate regulation may not lower rates and could instead harm the quality of care Californians receive.

Earlier this month the California Assembly passed AB 52, which would give two state agencies the power to approve or reject rate increases. As the contentious bill proceeds to the Senate and a legislative maelstrom, medical interests and consumer groups continue to spar over whether capping healthcare rates will limit escalating costs, and if health insurance rates can be regulated like those for automobiles.

Without the bill’s protection “California families will continue to live in fear that they are just one rate hike away from no longer being able to afford health insurance,” says the bill’s co-sponsor, Assemblyman Mike Feuer (D-Los Angeles).

But opponents claim that the bill would prevent doctors and hospitals from recouping proper fees, thereby reducing access to care.

The California Medical Association (CMA) says rate regulation would have a chilling effect on doctors already besieged by cost controls, and reduce the number of primary care physicians, who already face severe shortages in the state, especially in rural counties. Besides reducing access to physicians, CMA claims doctors could also be forced to see more patients for a shorter period of time.

Under the bill, once submitted for approval, rates can be approved, rejected or revised to a lower percentage. Commissioners from the Department of Managed Health Care or the Department of Insurance could decide whether a rate increase is unreasonable under existing state law using actuarial principles such as medical cost inflation and medical loss ratio — the percentage of an insurer’s revenue spent on health costs, as opposed to administrative costs and profits.

For example, the commissioners of DMHC or DOI could claim that based on evidence supplied, only a 10% rate hike was justified, rather than 20%.

After a commissioner’s decision, the health insurer would have several options: request an arbitration hearing held by an administrative law judge, or sue the department in state court. The health insurer can also withdraw the rate hike and re-submit it with additional supporting evidence.

Arbitrators could overrule the commissioners if their decisions are considered arbitrary.

Rate hikes for each plan would be limited to once a year.

No portion of the bill addresses the relationship between the health insurer and the providers of medical services – doctors or hospitals – which are private contractors.

Joining the California Medical Assn. in opposing rate regulation is the California Association of Health Plans (CAHP), which says that all medical providers depend on private insurance to recoup the billions of dollars they lose annually treating the uninsured and underinsured.

Approximately 8 million Californians are currently uninsured.

“By setting arbitrary limits on private insurance, AB 52 will lead to more emergency department closures, longer delays in getting emergency care and even fewer doctors willing to accept Medi-Cal or Medicare,” said a CAHP spokesperson.

Since 1990, many hospitals serving the urban poor have closed because of low reimbursements.

The California Hospital Association claims the unintended effect of rate regulation would be “seriously undermining the ability of health care providers to serve our patients.”

The health plans association says the bill targets health insurers instead of the real culprits of rising healhcare costs: chronic disease, treatment inefficiency, and expensive new technologies that often go unused. Chronic disease accounts for 70% of all American deaths, according to the Centers for Disease Control and Prevention; in 2005 half of American adults suffered from at least one chronic disease.

If passed by the Senate and signed by Governor Brown, the bill would require that all health insurance rate increases be reviewed and approved by the state’s Department of Managed Health Care, which oversees health maintenance organizations (HMOs), and the Department of Insurance (DOI) for individual policies. DOI currently has the power to review and approve car insurance rate hikes.

Last year, consumer groups were outraged when Anthem Blue Cross announced it would raise individual plan rates up to 39%. The state’s largest for-profit health insurer, which specializes in individual policies, later rescinded the rate increases after vehement opposition, including criticism from President Obama and the U.S. Congress.

Among those shocked by the planned Anthem Blue Cross price hike was Dave Jones, then chairman of the Assembly Health Committee. Last fall, Jones was elected the state’s insurance commissioner, where he oversees automobile insurance rates and is a prime supporter of AB 52.

Besides a legion of California healthcare advocacy and disease groups, rate regulation is also supported by Kathleen Sebelius, U.S. Secretary of Health and Human Services.

“We believe that insurance commissioners should have rate approval authority and will continue to support states’ efforts to review premium increases and protect consumers,” Sebelius said.

Supporters of the bill say rate hikes could come fast and furious as most provisions of the Affordable Care Act take effect beginning in 2014.

Does regulation of healthcare rates work in other states with some form of regulation and approval? The legislative analysis of AB 52 reports “there is little reliable scientific evidence about the impact of rate review and the authority to reject rate increases on long-term premium growth.”

Opponents are evenly divided.

Health Access, a leading consumer group defending healthcare rights, references a report by the Kaiser Family Foundation that rate review and approval are essential to prevent onerous rate increases. (KFF is unrelated to the Kaiser Permanente health system.)

But John R. Graham, director of Health Care Studies at the Pacific Research Institute, disagrees. In his comprehensive study of 43 states – 4 of them unregulated, 19 merely requiring insurers to file increase notices with the state, and 20 demanding state approval of rate hikes — Graham found a surprising result.

“There is little or no evidence that prior approval of premium increases has protected consumers from unreasonable rate hikes,” summarized Graham.

Graham says insurance companies are unfairly targeted in the healthcare price wars and that they are merely “a pass-through” of costs rung up by doctors and hospitals.

“Voters see premiums, but they do not see the underlying medical costs because most (costs) are passed through the health plan,” said Graham.

CAHP claims that insurance company profits are a scant 3% of a patient’s healthcare premium.

As the fight over AB 52 regulation escalates, Blue Shield of California chairman Bruce Bodaken recently announced that the company would voluntarily limit its profits to 2%, apparently in response to fears of rate regulation.

Besides the concerns over access to healthcare, CAHP also fears a bureaucratic boondoggle, and points to a legislative analysis of AB 52, which estimates an annual $30 million in costs for administering the bill. This would, however, be partially offset by $3 million in federal funding the state will receive over the next three years, with the potential for an additional $2 million a year.

Other parties could benefit financially, such as one of the bill’s primary supporters, Consumer Watchdog. Long a defender of consumer rights, the progressive organization headquartered in Los Angeles has bankrolled over $6 million in “intervenor fees” since 2004 defending improper rate hikes, most of them against auto insurers. The money is paid for “reasonable advocacy fees and expenses.”

CAHP says that costly lawsuits would merely result in higher premiums.

AB 52 would be an aggressive step forward from last year, when California passed SB 1163, which simply required that health insurance companies submit rate changes for all small groups (along with “unreasonable” rate increases for large groups) 60 days prior to the effective date.

The bill was referred to the Senate Committee on Health June 8.

If passed, AB 52 would take effect in January, 2012. It be retroactive to January1, 2011, and would allow approval of any rate hikes that occur this year.

 

Brown’s big budget bet

Published: June 16, 2011 | Comments (2)

By Daniel Weintraub

Gov. Jerry Brown’s veto of the new state budget Democrats passed this week represents a gamble that California’ deadlocked Legislature can find its way to a bipartisan solution that has evaded it all year.

Brown, in his veto message, blamed Republicans for refusing to go along with his proposal for a special election at which voters would be asked to ratify the extension of about $10 billion in taxes due to expire at the end of this month.

Brown also slammed his fellow Democrats, indirectly, by describing the budget they passed as filled with “legally questionable maneuvers, costly borrowing and unrealistic savings.” He noted that it would leave the state’s books unbalanced for years to come and add billions of dollars of new debt to the California’s already overburdened balance sheet.

But Brown’s rejection of the budget does not guarantee he is going to get anything better from the Legislature in the days and weeks ahead.

Republicans remain opposed to new taxes, and even to extending the temporary taxes that are about to expire. Democrats remain opposed to making the kind of spending cuts that would be required to balance the budget without those taxes. There appears to be very little middle ground.

Given that deadlock, the budget Brown vetoed Thursday made sense to legislative Democrats. It was their best chance in the short term to protect the programs they believe are vital to California without making concessions to Republicans that would have meant long-term consequences the Democrats could not accept.

This was the first budget to pass since voters last November enacted Proposition 25, which gave the majority party in the Legislature the power to write a budget with their votes alone, rather than the two-thirds majority that was required before.

But that measure left untouched the super-majority requirement for new taxes. And with Republicans opposed to higher taxes, the Democrats’ options are limited.

They could accept a deal offered by some Republicans to place on the ballot a measure that would have extended about $10 billion in temporary taxes that are about to expire. But in order to get that Republican support, Democrats would have to agree to a public vote on a tough new spending limit and rollbacks in public employee pensions, as well as a weakening of the states’ environmental protection laws.

With voters seemingly more opposed to taxes by the day, Democrats might place themselves in the position of holding an election at which their proposed taxes are voted down while the Republican proposals are approved. And even if the voters embraced the taxes, the levies would still be temporary, while the Republican measures would be locked into the state constitution.

That was a deal the Democrats simply could not accept.

The only other alternative for the Democrats is to pass a “responsible” budget on their own that cut spending to live within the revenues the state expects to collect during the next 12 months.

But the wisdom of doing that depends on your definition of the word “responsible.”

To outside analysts using standard bookkeeping principles, that means balancing projected revenues and spending. And with revenues dropping, Democrats would have had to cut deeply into schools, higher education, local government and the safety net.

Those cuts would have come on top of a round of reductions the Democrats approved in March. Those cuts reduced welfare grants and aid to the aged, blind and disabled, cut support for child care and trimmed health insurance subsidies for the low-income working poor. The Democrats also limited in-home support for the elderly and the disabled and cut services for people with developmental disabilities. The March package also cut $500 million each from the University of California and the Cal State University system, forcing another round of tuition increases on students and their families.

And so, rather than doubling down on those cuts, Democrats punted.

They voted to defer nearly $3 billion in payments due to the schools in the next fiscal year to the year after next. The schools would still get the money, but they would get it late. Many districts would have to borrow to cover cash shortfalls caused by the late payments from the state. But on the state’s books for the coming fiscal year, the deferral is as good as a budget cut, because the spending wouldn’t be counted until after the close of the fiscal year.

The budget also included about $1 billion in optimistic revenues assumptions. With tax collections in May running $400 million above earlier projections, the Democrats dedicated that money to the budget and then assumed that another $400 million would materialize next year. They are also counting on $200 million by requiring Internet retailers to collect sales tax on items they sell to Californians.

The Democrats were also hoping that the federal government would help, and the budget relies on $700 million in new payments for the Medi-Cal program that the state says the feds owe California.

Senate Republican Leader Bob Dutton called it an “irresponsible package” that did nothing to change “government as usual” in Sacramento. Brown seemed to agree. Even Democratic leaders in the Legislature conceded that their budget was less than perfect.

Assembly Speaker John Perez, D-Los Angeles, said the plan would close “more than half” of the state’s ongoing gap between spending and revenues, a step he described as “astonishing” given that Californians would pay lower taxes beginning July 1.

Sen. Mark Leno, D-San Francisco, chairman of the Senate Budget Committee, described the plan as the “best possible solution we could develop given the tools we had available.”

Democrats acknowledge that they would still have a hole of about $6 billion to fill in a general fund budget that next year will be around $90 billion. Their plan is to take a tax package to the voters in 2012, in a regular election when Democratic turnout will likely be higher than it would have been in a special election this year.

Many Democrats are hoping that the economy will continue to grow, tax collections will exceed projections, and some of the shortfall will be closed naturally. That may occur, and the state does have a history of economic recoveries that exceeded expectations. But even the most optimistic projections about the economy suggest that the state cannot grow its way out of its deficit. New taxes or lower spending are going to have to be part of the mix.

More ominously, the economy has lately been showing signs of renewed weakness. Employment growth has slowed, housing prices are still dropping, and the stock market is heading lower by the week. These trends could all lead to lower income tax collections and an even bigger deficit next year.

Brown has said since he took office that he did not want to continue the state’s tradition of hoping for the best while putting off the tough decisions required to pass a balanced budget. He is still hoping that Democrats and Republicans in the Legislature will agree to a deal that would extend the taxes until an election is held and the voters have a chance to weigh in.

But nobody, perhaps not even the governor, knows how long he is willing to wait. Once the new fiscal year begins, and payments to vendors and local government are delayed and a cash crunch looms, he might be forced to accept a flawed budget that looks very much like the one he rejected Thursday.

Daniel Weintraub is editor of the California Health Report at www.healthycal.org

 

Survey says low-income Californians want more say in health care

Published: June 15, 2011 | No Comments

By Daniel Weintraub

Nearly six in ten low-income Californians say they would be interested
in switching health care providers if they had a choice, according to
a new, independent survey of poor and near-poor state residents.

And if the federal health reform passed last year is implemented as
planned, many of those Californians will get that choice.

That new freedom could reshape the health care landscape in ways large
and small. One thing it would do is force community clinics and health
centers to be more responsive to patient needs, since many of those
patients would have the ability to go elsewhere with federal subsidies
and a state health insurance exchange open for business.

The survey was sponsored by the Blue Shield of California Foundation,
which has worked with clinics and health centers to improve their
operations and their reputations. (The foundation is also a sponsor of
this web site, www.healthycal.org).

“We have an enormous population of Californians who will have the
ability to go shopping for health care for the first time in their
lives,” said Gary Langer, whose firm directed the poll. “They will be
able to reach out and make choices about where they go for care.

“That creates a whole new world of risk and opportunity for the
organizations currently focused on providing care for these people.
Much of that care has been focused on what the funders and the
organizers think needs to be done, rather than on what the patients
want to have done.”

The survey questioned 1,005 Californians aged 19 to 64 with incomes
below 200 percent of the federal poverty level, or about $45,000 for a
family of four.

Among the findings:

–About four in ten say they currently have no choice in where they go
for health care. About 44 percent use a community clinic or health
center, about 30 percent go to private doctors and 1 in 10 use the
Kaiser health care system. One in ten also said they simply rely on
emergency rooms for their care.

–Low-income Californians are less healthy than state residents in
general. One in three say they are disabled or chronically ill, and
just one-third say health is excellent or good. Yet this group is no
more likely than other Californians to get medical care. This means
many may do so once they are given greater access to care under the
new federal law.

–58 percent said they would be interested in changing health
facilities if given the chance. Among community clinic patients, this
rises to 73 percent.

–The most powerful driver leading people to want to change is the
lack of a personal doctor. Among those who don’t have their own
physician, 86 percent say they would be interested in going elsewhere.

–Looked at another way, about one third say having their own doctor
is the most important thing about their health care provider. About
the same number mentioned cost as the number one driver that would
influence their choice, if they had one.

–The five factors found to predict a patient’s satisfaction with
their facility were the courteousness of staff, patient involvement in
medical decisions, the cleanliness of the facility, the amount of time
the doctors spend with the patient and having a highly regarded
personal doctor.

Peter Long, president and CEO of the foundation, said the findings
should be a wake-up call for California’s clinics, because while many
clinic patients are satisfied with their care, a large number say they
would go elsewhere if they could.

Long said clinics and health centers, to compete in the new world of
health care, are going to have to be more responsive to their patients
by providing a regular doctor, accepting appointments instead of only
walk-ins, and having clean, well-run facilities.

The good news, Long said, is that the clinics have “plenty of time” to
make those changes before the law takes effect in 2014.

“I think these findings will drive transformation as much as anything
we’re doing,” Long said.

Carmela Castellano-Garcia, president and CEO of the California
Primary Care Association, said most clinics and health centers are
already making the kind of changes that the patients in this survey
said they want. She noted that a large majority of the respondents
said they found clinic care to “good,” “very good” or “excellent.”

‘We’re moving in the right direction,” she said.

To see the executive summary of the report, click here.

 

Health center closures could leave thousands without options

Published: June 13, 2011 | No Comments


This article is one in an occasional series on aging with dignity and public policy that affects the ability of elders to live independently. For a complete archive of the articles, click here.

By Herbert A. Sample

In 2002, Nina Nolcox found her calling. After years as a registered nurse in skilled nursing facilities and hospitals, often on the nightshift, Nolcox started working in an adult day health care center in South Los Angeles. Four years later, she bought the business, Graceful Senescence, with the aid of a small business loan.

Nolcox now employs 26 people and provides health services to about 115 mainly African American and Latino seniors who suffer from diabetes, Alzheimer’s, high blood pressure and other chronic ailments.

Adult Day Health Care is “probably the most logical health care model that I’ve been a part of,” Nolcox said. “I fell in love with it.”

But Nolcox’s clients might soon have to go elsewhere for their care, or get none at all, because the state appears certain to eliminate the three-decades old Adult Day Health Care program in the next few months. More than 35,000 Californians will see their services end, though some as yet undetermined number will be transition to other forms of care.

Paradoxically, the U.S. government is beginning to prod states to establish or expand programs that aim to do what ADHC does in California -– steer seniors and disabled adults away from expensive nursing homes and hospitals, and into community- and home-based care.

“It is a huge disconnect,” said Lydia Missaelides, executive director of the California Association for Adult Day Services, which represents ADHC centers. “At the very moment that the incentive and the public awareness and the rules and the pilot projects and the innovation is coming out from the federal level to the states…here we are in California just taking this huge step backwards and losing an important part of this continuum of care that we need.”

Few really want to kill ADHC, which costs $340 million a year – about $169 million of it in state general funds and the rest from the U.S. treasury. Though the measure passed by state legislators that authorized ADHC’s demise alleged that the program remains vulnerable to fraud, that is rarely invoked as a reason for shutting it down.

Instead, in what has become a refrain for many cuts throughout state government, officials faced with California’s budget crunch admit they have few choices other than to eliminate what is, after all, an optional benefit under federal Medicaid laws.

“We recognize its value and it has served people very well,” Norman Williams, spokesman for the state Department of Health Care Services, said of ADHC. “We have to make some tough choices on what to continue and what to reduce and what to eliminate.”

For poor seniors with chronic illnesses and younger disabled adults, ADHC centers are a ticket out of their residences and into a more socially rich environment where they can receive a number of health-related services – such as physical, occupational and speech therapy, dietary information, and blood pressure and blood sugar monitoring — that is more costly if done in the home by a team of personnel. Centers’ group activities also provide social interaction and physical exercise that leads to healthier emotional lives, Missaelides said.

“People can be just as easily institutionalized in their own homes if they become terribly isolated as they can be by living in an institution,” she added.

The birth of ADHC in the late 1970s was in part a reaction to stories exposing the warehousing of the elderly in nursing homes and other facilities. Other states emulated it; about a dozen authorize similar programs now, according to federal officials.

More than 300 centers operate in California, the bulk of them in Los Angeles County. About 80 percent of the beneficiaries are seniors, and others include younger patients who suffer from traumatic brain injuries, cognitive diseases such as Alzheimer’s, and developmental disabilities.

Nolcox said she observed little coordination between doctors and other care providers in most of her past nursing jobs. But the ADHC program’s requirement for a multi-disciplinary approach to each beneficiary impressed her.

“Now I can deal with all areas that are potentially causing the problems with this person and close the gap,” Nolcox said. “We do it in a team fashion….It was the first place that I had been that I was able to feel like I was having an impact in actually decreasing health care costs and improving quality of life.”

As beneficial and cost-effective as ADHC may be, federal rules consider it voluntary for states while more expensive nursing home care are mandatory. That’s why twice before in recent budget struggles, California officials have tried to eliminate the program. Though reluctantly, they appear to have succeeded this time.

The Legislature authorized ADHC’s end earlier this year, and the federal Centers for Medicare and Medicaid Services has until mid-August to act on the Brown Administration’s proposal, according to a CMS official who did not want to be identified. CMS is examining the state’s plans to transition at least some ADHC beneficiaries into other services, but the agency is expected to go along with ending the program – if for no other reason than the state is not required to maintain it.

At the same time, the federal government has begun to push a goal – voiced in, for example, a little-noticed part of last year’s health care reform law – that states steer seniors into home- and community-based services, and classify more costly nursing homes and other institutions as a “fall-back option.”

The health care reform law funded two such programs: The Money Follows the Person Demonstration, which was originally authorized in 2005, and the newer Community First Choice Medicaid Option. Thirteen states, though not California, were awarded $45 million in February to implement their MFP programs.

Regulations for CFCO are due later this year, and it will not be implemented before October. Some estimates suggest California could receive about $125 million annually from it. But federal officials said CFCO money is aimed at home supportive services – such as cooking, cleaning, bathing and transportation to doctors’ offices – and not the more directly health-related services ADHC provides.

The seeming incongruity of the federal goals and California’s elimination of ADHC is not lost on federal officials.

“States struggle with that,” the CMS official said. “They can’t eliminate the nursing homes benefits. They can’t eliminate the hospital benefits….And if they need to make a cut in their budget, they need to look at where they can cut, and they have the ability to cut an optional service.”

Advocates for ADHC worry that the guts of a program will be difficult to replicate once California’s economy and budget stabilizes.

“It ain’t coming back,” Casey Young, a lobbyist for AARP California. “These are businesses that are going to close, and the infrastructure will be gone.”

Nolcox’ because the state appears certain to eliminate the three decade-old Adult Day Health Care program in the next few months.

Graceful Senescence could be one of them, Nolcox said. Her entire business, personal finances and employees are now in danger.

“I might be forced to lay off 26 people and claim personal bankruptcy,” she said. “Remember, I have an SBA loan.”

Similarly, the non-profit Yolo Adult Day Health Center in Woodland may have to close if there is no seamless transition from ADHC to another program, said Dawn Myers Purkey, the center’s program manager and immediate past president of CAADS.

“We could bear at most several months worth of support as we slowly work toward completely closing our doors. There’s no pretending for us that we’re going to survive,” said Purkey, whose center provides services to 80 beneficiaries and employs 17 workers.

Missaelides said CAADS is working with center owners to diversify by attracting patients who can pay themselves or through private insurance. “It’s really hard right now to say what will happen,” she said.

It’s also difficult to predict the future of beneficiaries who aren’t transferred to other programs. Advocates complain the state has offered few concrete answers, and they suggest a significant number of former ADHC patients will end up in emergency rooms, hospitals and nursing homes – at a higher government cost and exactly counter to the approach the U.S. is emphasizing.

State legislators have signaled support for a new program called Keeping Adults Free From Institutions, into which the former ADHC beneficiaries with the worst conditions would transition. It would cost about $170 million, with the state and federal governments sharing the burden. But KAFI has not yet won final approval, and Department of Health Care Services officials say they won’t start working on it until it does.

There’s a bigger, longer-term worry, said Gary Passmore, director of the Congress of California Seniors: The number of California’s senior citizens will rise from 4½ million to 10 million in about 20 years.

“It is ironic and tragic that in the face of this projected demand, the State of California is actually cutting back,” he said. “We have…put our heads in the sand, and (are) in denial that millions of people are going to need services and care.”

State officials say they understand the demographics, even as they grapple in the here and now with extremely tight bottom lines. The demise of ADHC is going to force some efficiencies into the mix of services the state offers, while the health care reform law will provide funds and guidance to eventually do more, Williams said.

“We are looking at all of these with an eye to the future to provide to all segments of the Medi-Cal population,” he added, “including and most urgently, in terms of time, the seniors.”

Herbert A. Sample is a freelance writer in Los Angeles. He can be reached at hasample@mac.com.

 

Lawsuit filed to block budget cut

Published: June 10, 2011 | No Comments

Defenders of a program that provides health care to keep low-income people with disabilities from being hospitalized or placed in nursing homes sued today to block the state from eliminating the program.

The Adult Day Health Care program serves 35,000 people, including many older adults. It is a benefit provided through Medi-Cal, the subsidized health program financed by a combination of state and federal money.

The plaintiffs in the lawsuit, known as Darling et al v. Douglas, contend that the planned, Sept. 1 elimination of the program would put tens of thousands of people at risk of institutionalization, hospitalization, injury or death.

“Elimination of this program as a Medi-Cal benefit will not only cause irreparable harm to the tens of thousands of people affected by the cuts, but will also result in increased costs to the State and counties in hospitalization, nursing facility placements, Adult Protective Services, and emergency services,” Elissa Gershon, an attorney with Disability Rights California, said in statement.

The lawsuit contends that the Legislature’s decision in March to eliminate the program was illegal because the state has not assured that the people who now get those services can receive the care needed to avoid hospitalization or being placed in nursing homes.

The litigation follows on a case first filed in August 2009. A federal court stopped the state from cutting the program in September 2009 and February 2010.

The state had tried to reduce the maximum number of days a person could receive services from five days to three, regardless of need. The state later tried to restrict eligibility in a way that would have ended services to as many as 15,000 clients.

Those rulings, ironically, led the state to try to eliminate the entire program. The state is not required to provide the service under the terms of its relationship with the federal government to receive funding for Medi-Cal. But if it does provide it, the state must meet certain standards. State officials reason that eliminating the entire program will free them from that legal burden.

But supporters of the program say otherwise.

“The State cannot shirk its obligation to provide medically necessary services to each and every Medi-Cal participant who qualifies. If the State chooses to cut ADHC services across the board, it still must, according to federal law, continue to provide skilled nursing and therapy services to people who need them” said Anna Rich, attorney with the National Senior Citizens Law Center.

The plaintiffs in the case say that clients in the program average 78 years old and take six or more medications a day, for which nearly two-thirds require supervision or assistance. More than two-thirds also face at least three serious medical challenges including cardiovascular disease, dementia, and diabetes. The overwhelming majority are entirely dependent on Medi-Cal funding for their care at the adult day health centers.

-Daniel Weintraub

 

Insurance firm limits income to 2 percent

Published: June 8, 2011 | No Comments

By Daniel Weintraub

Hoping to lead an industry push toward more affordable health insurance, Blue Shield of California will voluntarily limit its net income to no more than 2 percent of its revenue, company executives said Tuesday.

The cap will be retroactive, leading the company to let go of $180 million in income from 2010 that exceeded the self-imposed limit.

Most of that money will be returned to customers in rebates. The rest will be given to health care providers that work with the company’s customers and to the firm’s non-profit foundation, which will invest it in community projects to improve the health of Californians.

“We will make coverage a bit more affordable for our members,” said Bruce Bodaken, Blue Shield’s chairman and CEO. “Affordability is the gateway to universal coverage and to the success of federal health reform.”

The announcement comes as the Legislature considers a proposal to regulate health insurance rates the same way California has long controlled rates for automobile coverage. The insurance industry has strongly opposed that proposal, arguing that most of the money they collect from customers is simply passed on to doctors, hospitals, drug companies and other players in the health care market.

Bodaken said the company’s pledge to cap its income is not related to the Legislative debate but is part of a long-term plan to make coverage more affordable. He said this is the first time a health insurance plan has made such a promise, which he called a “paradigm shift.”

Company officials said the rebates would be issued in October and would average about $80 for individuals and $250 for a family of four.

Bodaken publicly urged other health insurance companies to follow Blue Shield’s lead, but he acknowledged that his firm, as a non-profit, would find it easier to limit its income. For-profit companies have to satisfy shareholders, who typically expect profits greater than two cents on the dollar. Blue Shield’s income has averaged 3 percent to 4 percent over the past decade.

Consumer advocates reacted cautiously to the announcement, praising Blue Shield but insisting that rate regulation is still needed in California.

Anthony Wright, executive director of Health Access California, noted that Blue Shield has raised its rates significantly in recent years and the rebates would roll back only a portion of those charges. He also said the company’s definition of revenues, costs and income would need to be scrutinized.

“The oversight of the new federal law has ushered in new accountability on insurers, but we needed additional state authority and action to make the promise real,” Wright said. “We need to pass the pending rate regulation bill to ensure that California consumers don’t get overcharged on the front end, by Blue Shield or any other insurer.”

Note: The Blue Shield of California Foundation is a sponsor of HealthyCal.org.

 
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