The California Senate Budget Subcommittee on Health and Human Services heard testimony yesterday on the pending funding formula for 2011 Realignment Behavioral Health Subaccount Growth Allocation. Nearly three years after the program was realigned to the counties, representatives from the Department of Finance (DOF) and the Department of Health Care Services (DHCS) have not yet developed a methodology for allocating growth funding.
Realignment’s effect on EPSDT services is a critical issue for California’s young people with unmet mental health needs, and a key focus of Young Minds’ advocacy. In this post we will break down some of these complicated issues and highlight a few of the concerns shared by stakeholders at yesterday’s hearing in Sacramento.
EPSDT and 2011 Realignment
In 2011, California made changes to the funding structure for public mental health programs, including the Medi-Cal Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) program. Counties deliver these services to Medi-Cal beneficiaries and were reimbursed for the costs using federal Medicaid and state general funds. As a result of the 2011 Realignment, however, counties now have primary responsibility to fund the state share of costs using dedicated state tax revenues.
The new funding stream is divided among several behavioral health programs and allocated to the counties by the state. SB 1020, enacted in 2012, directed DOF and DHCS to develop a methodology for distributing the funds. Using historic spending data, the departments have allocated an annual “base” for each county, but has yet to propose a formula for allocating funds in excess of the “base”, referred to as “growth funds.” Growth funds are estimated to be $27.9 million in fiscal year 2012-13, $52.8 million in 2013-14, and $184.3 million in 2014-15. As to when a formula would be proposed, a DOF spokesperson stated at yesterday’s hearing, “There is no set timetable at this time.”
Stakeholders Provide Public Comment
EPDST funding structure under realignment restricts access to services
Public commentators at the hearing yesterday expressed concern that 2011 Realignment is having the effect of restricting access to mental health services. Many counties are treating EPSDT as a capped program and have limited treatment. This violates federal law because all eligible children are entitled to receive necessary EPSDT mental health services.
Rusty Selix, from the California Council of Community Mental Health Agencies and the Mental Health Association of California, urged the Administration to clarify its Realignment funding policies: “It is very urgent that the Department come forward and say… that the EPSDT funding and the Drug Medi-Cal funding are entitlements and that if a county has spent more than its allocation, that will be a first claim on growth and that if a county has spent under its allocation, it will have a debit for growth.” In the absence of these assurances, Selix cited growing evidence that many counties are limiting EPSDT services.
In response, Toby Douglas, DHCS Director, affirmed that EPSDT remains an entitlement under Realignment and that “services must be provided based on that entitlement.” Douglas stated that counties have “no ability to cap services—if someone meets medical necessity criteria, they must provide services.” Douglas stated that the DHCS Information Notice 13-01, issued on January 30, 2013, was intended to communicate this requirement. Nevertheless, Douglas declined to directly address the questions raised by Selix and others.
Kristen Barlow, representing the California Mental Health Directors Association (CMHDA), took “exception to the assertion that counties are treating
[EPSDT] as a capped program.” Barlow further stated that it is “very clear to county mental health directors . . . that the EPSDT program . . . is an entitlement for the . . . kids who qualify for medically necessary services.”
Young Minds’ staff attorney Wesley Sheffield testified to reports from providers on an increasing number of instances where counties are failing to authorize intensive services. Also, Sheffield related that some counties have failed to spend their full allocation or have diverted EPSDT funding to other programs “at a time that we know that the [children’s] Medi-Cal population is growing.” California Alliance of Child and Family Services’ Director Carroll Schroeder, further noted that counties are “concerned that there just isn’t going to be enough money to cover their share of the costs.”
The Senate Budget Subcommittee held the Behavioral Health Growth Allocation agenda item open to allow DOF and DHCS to complete a proposed funding formula. The subcommittee’s agenda materials are available here. Yesterday’s hearing was televised and an archived video is available here with testimony regarding the allocation formula starting around the 1:46:00 mark.
The Assembly Budget Subcommittee will host its own hearing on the Behavioral Health Subaccount Growth Allocation on Monday, April 7 at 3pm. For more information, visit the California State Assembly website.