CDCAN DISABILITY RIGHTS REPORT #182-2010 –  OCTOBER 7,  2010

California Budget Crisis:

Details On In-Home Supportive Services Reductions

Budget Trailer Bill Attached To This Report – 2009 IHSS Cuts Not Rescinded But Delayed To Allow Cases To Be Decided by Courts – Details on New 3.6% Across the Board Cuts; Disqualifying Convictions for Providers and IHSS Worker Provider Fee

SACRAMENTO, CALIF (CDCAN) [Updated 10/07/2010  4:40 AM  (Pacific Time)] –  Details on the reductions in the budget agreement to be voted today by the Assembly and State Senate impacting In-Home Supportive Services (IHSS) were released early this morning in a budget related (trailer) bill – AB 1612 as amended 10/6/2010.  [A pdf copy of the 97 page bill, AB 1612, titled “20101006-AB1612(AsAmended10062010.pdf”, is attached to this report and can be downloaded also from the CDCAN website at www.cdcan.us  - apologize for the size of the bill – but it is important that people have this to review – Marty Omoto, CDCAN]

The Assembly and State Senate are scheduled to begin meeting at 11:00 AM Thursday morning (October 7) for debate and final vote on the budget agreement reached by the Governor and the four Democratic and Republican legislative leaders.  Most observers expect a long debate on agreement – though it appears there are the votes necessary to pass the spending plan.

Legislative officials said that the budget agreement will be contained in 20 separate bills (including the main budget bill) and 1 constitutional amendment (containing budget reforms proposed by the Governor that would appear on the ballot for voter approval in 2012).   AB 1612 is just one of those 20 budget related bills. 

DETAILS OF IHSS REDUCTIONS AND CHANGES

These reductions and program changes are currently in AB 1612 as amended 10/06/2010, and total $300 million in state general funds:

* $190 million of that amount is from the IHSS worker (provider) “fee’ or “tax”

* $75 million of that amount is from caseload savings (meaning the State is using more updated caseload numbers – which are lower than earlier projections, which results in less money needed for caseload.

*  $35 million from a 3.6% across the board reduction in authorized service hours for all IHSS recipients (see below for details)

* Changes in law on background checks for IHSS workers adding additional disqualifying convictions and crimes (see below)

In addition the 2009 cuts to IHSS that are currently blocked by the federal courts (the State is appealing) , were not rescinded as it was in the August Budget Conference Committee report but instead the implementation of those cuts are delayed until July 1, 2012 to allow those cases to proceed through the legal process until a final decision is made.  If the courts eventually ruled in favor the State – the courts would need to issue a ruling that “validated” or “okayed” the cuts before the State could actually move forward to implement the cuts on or after July 1, 2012. 

Also different from the August Budget Conference Committee report is the action that rescinded the requirements of fingerprinting of all IHSS recipients, and fingerprints on IHSS worker (provider) timesheets – neither which apparently is in the AB 1612. 

3.6% Across the Board Cut of Authorized Hours To All IHSS Recipients

1.  Effective 90 days following the enactment of this bill (meaning after the Governor signs the budget trailer bill containing this provision) the authorized hours of service for IHSS recipients will be temporarily reduced by 3.6%.

2.   Reduction will continue through the end of the 2011-2012 State budget year (June 30, 2012). 

3.  After June 30, 2012, the IHSS recipients service hours that were reduced earlier by 3.6% as specified – though it is not clear how specifically this will be done.. 

4.  Authorizes the Department of Social Services to implement and administer these provisions through “All-County Letters” or similar instructions from the department.

2009 State Participation Toward IHSS Worker Wages Cut

1.  Delays until July 1, 2012,  – but does NOT rescind (different from the August Budget Conference Committee report] the implementation of the provisions that limit state participation in IHSS worker wages and benefits to $9.50 per hour and $0.60 per hour, and would require a “court of competent jurisdiction” (in this case the federal courts where the case was filed) to issue an order that “validate” this reduction. 

2.  If and when the court does that, this cut would then go into effect – though not before July 1, 2012. 

3.  This reduction proposed by the Governor in January 2009 and approved by the Legislature in February 2009, was blocked in June 2009 in federal district court, a ruling upheld by the US 9^th Circuit Court of Appeals and has been appealed by the State to the US Supreme Court. 

4.  The US Supreme Court has not yet announced whether it will take up this case – if it doesn’t, then the ruling of the US 9^th Circuit Court of Appeals stands – which would permanently block or stop the 2009 cut to State participation toward IHSS worker wages.

5.  If the US Supreme Court decides to take the case it could take another two years or so before a decision on the case is handed down. Until then the cut would likely be blocked or stopped by the US 9^th Circuit Court of Appeals if it decided to uphold the lower federal district court ruling. 

2009 Cuts to IHSS Eligibility and Services Using Functional Index Score & Rankings

1.  This bill would delay until July 1, 2012 – but NOT rescind the implementation of the limit  eligibility for each domestic and related service in the IHSS program to a person who is assessed with a functional index rank of 4 or 5,  and would delay until July 1, 2012 – but NOT rescind, the implementation of the requirement to use functional index score to determine eligibility for any service in the IHSS Program

2.  Requires a “court of competent jurisdiction” (in this case the federal courts where the case was filed) to issue an order that “validate” this reduction.

3. This reduction, proposed by the Governor in May 2009 and approved by the Legislature in July 2009, was blocked by a federal district court in October 2009.  The ruling was appealed by the State to the US 9^th Circuit Court of Appeals.  The case was heard last year – and a decision by the appeals court is still pending (has not yet been handed down).  The reduction remains blocked unless the appeals court overrules the lower federal court’s ruling that stopped it. 

4.  The loser of the decision can appeal it to the US Supreme Court – a process that could take another year or two or longer. 

Criminal Background Checks & Other Disqualifying Convictions

1. 1.      Requires a nonprofit consortium, public authority, or county with criminal background check authority to secure a criminal background check clearance to accept a clearance for certain individuals who have been deemed eligible to receive payment under the IHSS program by another nonprofit consortium, public authority, or county with criminal background check authority. To the extent that these procedures would impose additional duties on counties administering the IHSS program, this bill would create a state-mandated local program.
2. 2.      Adds other additional criminal convictions, that would disqualify a person from being an IHSS worker (provider)  including convictions for certain violent and serious felonies, fraud in the obtaining of aid, and designated felony sex offenses, that would preclude specified provider applicants from becoming a provider of in-home supportive services, in addition to the criminal convictions that exclude a person from providing or being paid to provide in-home supportive services under existing law.
3. 3.      Would apply these additional new criminal conviction exclusions effective 90 days following the effective date of the bill (meaning when the Governor signs the specific budget trailer bill this provision is in.
4. 4.      Would require the IHSS provider enrollment form to be revised to include the excludable criminal convictions provided for by the bill.
5. 5.      Would authorize a person receiving services under IHSS to employ a particular IHSS worker (provider) who has been convicted of an excludable offense identified in the bill, by submitting an individual waiver to the county, as specified in the bill.
6. 6.       Outlines the county’s duties regarding the processing and granting these individual waivers.
7. 7.      Authorizes a IHSS worker (provider) applicant with an excludable criminal conviction to seek a general exception, in order to provide in-home supportive services to the general recipient population, and outlines criteria to be used by the Department of Social Services in determining whether to grant the exception.
8. 8.      Specifies related notice and administrative hearing requirements, and other duties of the department in connection with the implementation of the bill.
9. 9.      By changing the definition of the crime of perjury, and by increasing duties of counties administering the In-Home Supportive Services program, this bill would impose a state-mandated local program.

IHSS Worker (Provider) Reimbursed Fee or Tax

The below provisions deals with how an IHSS worker (provider) would pay the “fee” or “tax” without having to actually write out a check to pay it.  Payment of the fee and the reimbursement to the provider of that fee would happen at the same time – so the IHSS worker would never have to pay the fee out of pocket and wait for reimbursement. 

The provider fee or tax is a way for a state to draw down more federal Medicaid matching funds.  A similar fee was established in the early 2000’s first by intermediate care facilities and then by certain types of nursing facilities. The fee is matched by federal dollars – the provider is paid back (in most cases) and the remaining money goes to the State general fund. 

The below provisions are a rather complicated description (from the bill) describing how the IHSS worker would pay the fee and be reimbursed at the same time:

1.      Would impose a sales tax on IHSS providers for the “privilege of selling support services at retail”, measured by the gross receipts from the sale of those services in this state at a specified rate of those gross receipts.  Specifies that a seller is the Department of Social Services, a county, or other person or entity, as provided and  would require sellers to collect, report, and pay the sales tax. Would provide for the administration of the tax by the State Board of Equalization.

2.      Would also create the Personal Care IHSS Quality Assurance Revenue Fund in the State Treasury, and would require the revenue from the tax, less refunds, to be deposited in the fund. Provides that the fund is continuously appropriated to the Department of Social Services for purposes of supplementary payments to IHSS providers

3.      Would require providers of in-home supportive services to be paid a supplementary payment equal to a prescribed percentage of the gross receipts of the provider, plus additional amounts, as specified. Requires the supplementary payment to be made from the Personal Care IHSS Quality Assurance Fund.

4.      Requires specified amounts to be transferred, on an ongoing basis, from the State general fund to the Personal Care IHSS Quality Assurance Fund, thereby making an appropriation.

5.      Requires an amount to be transferred from the General Fund to the Personal Care IHSS Quality Assurance Fund, in the form of a loan, for initial implementation costs.

6.      Excludes the supplementary payment from gross income and would make related changes.

7.      Provides that its provisions shall be operative only if the Director of Health Care Services obtains necessary federal approvals, and be implemented commencing on the date permitted under that federal approval.

8.      Would make the provisions of the bill inoperative and repeal the provisions under specified circumstances.