Realignment Funding 101
A presentation for the
California Association of Public Authorities
by Karen Keeslar
July 26, 2006
This Presentation Will Cover:
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The Road to Realignment
IHSS Funding Prior to Realignment
IHSS Budget Situation in 1991
California Fiscal Situation in 1991
The Original Realignment Proposal
LAO Principles for Realignment
CSAC Principles for Realignment
Legislative Principles for Realignment
• Realignment Adopted
• Programs Transferred
• County Share-of-Cost Changes
• New Revenues & Expenditures
• The Realignment Maze
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Original Concept
Local Revenue Fund
County Local Health & Welfare Trust Fund
County Matching Requirements
• Netting
• Base Allocations, Growth Accounts & the
Caseload Subaccount
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Transfers Between Accounts
Poison Pills
Proposed Constitutional Amendment
IHSS Realignment Negotiations
Final IHSS Realignment Changes
PCSP & Enactment of Public Authority
Statutes
• Realignment Legislative History
The Road to Realignment Began…
By the end of the
1980’s many counties
were on the verge of
fiscal collapse.
• On June 6, 1978, with the passage
of Proposition 13, which:
• Limited general property tax
rate to 1 percent and limited
increases in assessed value
after property is bought or
constructed.
• Made the legislature
responsible for dividing
property tax among local
entities.
• Established requirement of twothird vote for Legislature to
increase taxes.
• Established requirement of twothird voter approval for new
local special taxes.
Counties on the Fiscal Fault Line
• The 1990/91 state budget hit the counties
hard – totaling more than $781 million:
• $175 million cut from county health funding
• $75.5 million cut from county mental health funding
• $101 million cut from county administered programs for
welfare recipients (the old GAIN program)
• $60.7 million cut from Trial Court Funding
• $54.8 million cut from Child Welfare Services
IHSS Funding Prior to Realignment
The January 1991/92 state
budget proposed $747 million in
expenditures for IHSS.
• This included an increase of $71
million, or ten percent, above the
estimated IHSS expenditures for
1990/91.
• IHSS expenditures grew at a rapid
pace through the 1980’s.
• Increased costs were attributed to:
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•
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An increase in the minimum wage
from $3.72 to $4.25 per hour.
Increases in both caseload and
average hours per case.
Increased costs of workers’
compensation (these costs grew
by 41% in one year.)
Proposed IHSS Funding Sources
91/92
(in millions)
$19.3
3%
$331.1
44%
$396.4
53%
State General Fund
County Funds
Federal (Title XX) funds
SB 412 Changes in IHSS Funding
• The county share-of-cost for
IHSS was frozen with the
enactment of SB 412 (Chapter
1438, Statutes of 1987) at the
1987/88 level of $19.257 million.
• SB 412 required the state to
cover any IHSS shortfall through
a state budget deficiency
appropriation.
• The measure eliminated
counties’ authority to reduce the
level of IHSS services if their
State appropriation was
insufficient to cover program
costs.
The IHSS Budget Situation in 1991
Governor Wilson’s January 1991 proposed state budget
revealed that the IHSS program would be facing a
deficiency in FY 91/92.
IHSS Program Funding
Sources
Proposed 91/92
Change from
90/91
Appropriations
Percent Change
State General Fund
$396,426
$64,898
19.9%
Federal (Title XX Funds)
$331,127
$5,606
1.7%
County Funds
$19,257
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--
TOTALS
$746,810
$70,504
10.4%
Estimated Expenditures to
fully fund IHSS
$760,810
Amount of
Deficiency
$14
Percentage of
Deficiency
4.3%
The Governor’s IHSS Budget Proposal for
FY 91/92
Governor Wilson’s Budget Summary for FY 91/92
indicated that the Administration would propose
legislation to cap IHSS expenditures at the annual
Budget Act appropriation for the program.
The proposed legislation would allow counties to reduce services to
recipients on a priority basis when anticipated expenditures exceed the
annual IHSS appropriation. This is similar to the legislation adopted in
1981 (SB 633, Chapter 69, Statutes of 1981) which capped IHSS
expenditures at the Budget Act appropriation and permitted counties to
make program reductions in the following priority order:
• Reduce the frequency of nonessential services.
• Eliminate nonessential services
• Terminate or deny eligibility to individuals requiring only domestic services.
• Terminate or deny eligibility to persons who would not require institutionalization in the
absence of services
• Reduce, on a per capita basis, the cost of services authorized.
California Fiscal Situation in 1991
• As a result of a national recession, California
faced the worse budget shortfall in our state’s
history.
• The January 1991 budget deficit was estimated to
be $7 billion.
• In late March 1991, Governor Wilson announced
that the projected deficit had grown to $12.6 billion.
• The May Revision to the budget estimated the
shortfall to be $14.3 billion.
• Thus, in crafting a state budget for 1991-92, the
Legislature and the administration faced a budget
funding gap equivalent to one-third of the state’s
General Fund workload budget.
The Original 1991 Realignment Proposal
• Governor Wilson’s January ’91 budget proposed to
transfer funding responsibility for three existing
programs and provide the counties with a revenue
source:
• $942 million in State funding would be eliminated for:
• County Mental Health programs
• AB 8 County Health Services
• Local Health Services
• County revenues would be increased by $942 million
through an increase in state-levied alcohol taxes and Vehicle
License Fees (VLF.
LAO Analysis:
The State/County Partnership
In February 1991, the LAO released their analysis of Governor
Wilson’s realignment proposal. The LAO provided the first set of
principles to consider in reform of the state/county relationship:
• Determine who will exercise program control
• Link program control and funding
• Pay attention to incentives
• Cost cost-effectiveness
• Address physical capacity
• Provide for fiscal capacity
CSAC Realignment Principles
CSAC worked with CAOs and county affiliates and adopted twelve
realignment principles on March 27, 1991.
1. Any transfer or program realignment proposal should be
designed to help both the state and counties maximize their
service delivery responsibilities and solve their cyclical and
structural budget crises;
2. The revenues projected in the base year should be a least as
great as the state’s expenditures for the programs transferred
and cover both direct and indirect costs.
3. The revenue provided for program transfers must have a
growth rate equal to or greater than the anticipated growth in
the transferred programs. If the revenue growth in uncertain,
there should be a “trigger” mechanism to ensure that program
expenditure growth does not exceed available designated
revenues.
4.
5.
6.
Counties and the state should jointly develop program
eligibility guidelines and scope of services which can be
supported by the designated revenues in order to provide a
minimum level of services among all counties.
The designated revenue sources provided for program
transfers must be levied statewide and allocated on the basis
of programs transferred. Any excess funding from the
designated revenue source in the base year, and any
subsequent growth in revenue sources, shall be allocated in a
matter which strives to achieve equity funding among
counties (equity to be defined). The designated revenue
sources may require implementation by county governing
boards. These designated revenue sources shall not require
a local vote.
The state’s responsibilities for a county maintenance of effort,
in any given year, must be limited to the amount of state
dollars expended for the program in that year.
7.
8.
9.
10.
11.
12.
Federal maintenance of efforts should remain the
responsibility of the state.
Counties must have the flexibility to manage the programs
within the revenue base made available.
County and state overhead costs should be reduced and
minimized in order to allow more dollars to be spent on
services.
In addition to designated state-revenue to funds program
transfers, counties should be given flexibility to raise local
revenues for local discretionary use.
There should be protection against the state being able to add
requirements in future years, without adequate funds, to those
programs which have been transferred.
Programs should be transferred to counties in a manner which
allows counties to maintain or maximize federal dollar
contributions.
The Legislature’s Realignment
Principles adopted April 25, 1991
1.
2.
3.
4.
Realignment should assure continued receipt of federal funds
and should allow the State to obtain additional federal funds
where available.
Counties should have appropriate fiscal incentives to service
clients in a programmatically appropriate manner.
Realignment should assure that the State does not assume
financial responsibility for clients transferred by counties to
other state programs.
Small rural counties’ fiscal exposure should be minimized.
These counties should be authorized to contract with the state
or establish risk pools.
5. State Administrative responsibilities should be limited to the
development and oversight of guidelines regarding program
performance outcomes. This should include uniform, simplified,
and consolidated data reporting requirements. Counties, by
approval of the Boards of Supervisors representing a majority of
counties and a majority of the population, shall adopt standards
for eligibility and the scope of services which will provide for a
minimum level of services among all counties.
6. Individual counties should have sufficient flexibility to broaden
eligibility and/or determine additional benefit levels by action of
the Board of Supervisors.
7. Funds provided for Realignment shall be dedicated to health
and welfare programs.
8. Realignment should minimize State exposure to existing and
future mandate claims.
9. Counties should have sufficient fiscal capacity, through new
revenues and/or new revenue authority, to assume program
responsibilities from the State.
10.In the first year, individual counties should be held harmless
from net reductions. Future growth in new county revenues may
be used to address equity issues.
Realignment Adopted
The Legislature adopted significant
changes to the State/County
relationship with a realignment
package that was significantly
expanded from the original proposal by
Governor Wilson. The realignment
passed by the Legislature included
three major components:
1. Program transfers from the state to the counties
2. Changes in state/county cost-sharing ratios for certain social
services and health programs, and
3. An increase in the state sales tax and the VLF earmarked for
supporting the increased financial obligations of counties.
Programs Transferred to Counties
(Amounts in millions)
Estimated Cost Shifts to Counties
Mental Health
• Community-Based Mental Health Programs
• State Hospital Services for County Patients
• Institutions for Mental Diseases (IMDs)
$750
452
210
88
Public Health
• AB 8 County Health Services
• Local Health Services (LHS)
$506
503
3
Indigent Health
• Medically Indigent Services Program (MISP)
• County Medical Services Program (CMSP)
$435
348
87
Local Block Grants
• County Stabilization Subventions
• County Juvenile Justice Subventions
$52
15
37
County Cost-Sharing Ratios Changes
(Amounts in millions)
State/County Shared of
Nonfederal Program Costs
Estimated Costs
Shifted to
Counties
PRIOR LAW
REALIGNMENT
75/25
50/50
$30
• AFDC – Foster Care
95/5
40/60
$363
• Child Welfare Services
76/24
70/30
$42
• In-Home Supportive Services
97/3
65/35
$235
• County Services Block Grant
84/16
70/30
$13
• Adoptions Assistance Program
100/0
75/25
$12
• Greater Avenues Towards Independence
100/0
70/30
$26
• AFDC – Family Group & Unemployed Parent
89/11
95/5
-$155
50/50
70/30
- $95
Health
• California Children’s Services (CCS)
Social Services
• County Administration (AFDC-FC, FG, U &
Foodstamps)
New Revenues & Expenditures
Estimated Additional
Revenues to Counties
• State Sales Tax = $1,422 billion
• Vehicle License Fee = $769 million
Estimated New
County Expenditures
For program transfers & changes in
sharing ratios.
$2,212 billion
Understanding the Realignment
Maze
The process of developing the legislation
was complex due to:
• the nature of the state/county relationship,
• extreme cash flow problems at both the
state and county level,
• the intricacy of creating new deposits of
realignment revenues,
• the challenge of creating transfer authority
that would not jeopardize federal funds,
• ensuring accountability for the state’s
Local Revenue Fund and the counties’
Health & Welfare Trust Fund.
The realignment structure is a
complicated maze of accounts and
subaccounts – each with their own
underlying complexity.
The original concept
The State’s Local Revenue Fund
Accounts and Subaccounts per AB 1288
Local Revenue Fund
Sales Tax Account
Vehicle License Fee (VLF) Account
Sales Tax Growth Account
VLF Growth Account
Mental Health
Subaccount
51.91%
CMSP Account
Caseload
Subaccount
Mental
Health
Subaccount
Health
Subaccount
11.92%
Local
Government
Allocations
Indigent
Health
Subaccount
State
Hospital
Subaccount
Community
Health
Subaccount
CMSP
Subaccount
Social Services
Subaccount
36.17%
General
Growth
Subaccount
The County’s Local Health &
Welfare Trust Fund
• As a condition of receiving realignment revenues, each county is
required to establish a Local Health & Welfare Trust Fund with
three accounts.
(Welfare & Institutions Code 17600.10)
• AB 1288 mandates that realignment revenues can only be used
for indigent health, mental health, social services, and juvenile
justice programs. (Welfare & Institutions Code 17609)
The Original County Matching
Requirements – Problems with AB 1288
• AB 1288 required counties to make specific deposits of revenues
into the Local Health & Welfare Trust Fund even if counties has
not actually received these revenues from the State. The AB
1288 statutes were enacted in expectation that counties would
receive an even distribution of realignment revenues on a monthto-month basis. The requirements of AB 1288 immediately
created problems for counties.
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P
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AB 1491 Solved Some Problems
SOLUTION: Enactment of AB 1491 (Chapter 611, Statutes of
1991) corrected the situation by specifying that counties
must deposit realignment revenue as the funds are actually
received by counties from the State.
Another important provisions of AB 1491:
• The allocation schedules for each account within the State’s Local
Revenue Fund was modified following input from the counties in
order to correctly establish health, mental health & social service
“base” allocations.
• Allowed counties to use the portion of realignment revenues
originally attributed to the “Stabilization Fund” for discretionary
(non-realignment) expenditures. The Stabilization Funds were $15
million per year for specified counties and those funds were folded
into the distribution of funds from the Social Services Account.
(County Stabilization Funds were established pursuant to Government Code 16265 through 16265.7)
Understanding the Social Services
Account – Description of “Netting”
The Social Services
Account is a “netted”
account.
• This captures information about
new program savings that were
attributed to reducing the county
share-of-cost for realigned
programs, as well as
• New or increased county sharesof cost that were established by
realignment.
How “Netting” Impacts County
Funding for IHSS
The statutory realignment base
is $2,212 billion, divided
between the three subaccounts,
as displayed. The Social
Services Subaccount Base is
$522.4 million.
IHSS County Shares of Cost
Pre & Post Realignment
Totals $252,391,067
$19,256,605
$233,134,462
Pre-realignment
Post-realignment
Realignment Base Amounts
Total $2,212 billion
$522.4
$941.2
$749.0
Health
Mental Health
Social Services
That means that realignment
funds from the Social
Services Account pays for
the “net” new cost to counties
for IHSS of $233,134,462.
NOTE: Values are from FY 91/92
PCSP Revenues Further
Complicated the “Netting” of IHSS
The Personal Care Services Program (PCSP) was implemented on
April 1, 1993, which added the new federal revenues to the IHSS
program for the last quarter of fiscal year 1992/93 and for each full
fiscal year thereafter. The county savings from PCSP are further
“netted” to determine the actual county share-of-cost funded from
the realignment.
Realignment Shortfall
• When AB 1288 was enacted,
the VLF and sales tax increases
were projected to raise $2,212
billion – which would have fully
offset anticipated county costs
under realignment for 91/92 and
generated growth revenues to
begin making “equity payments”
in subsequent years.
• Due to the lingering recession,
actual realignment revenues fell
$245.43 million below the original
91/92 estimates.
(In Millions)
Account
Original
Estimate
Actual
Revenues
Shortfall
Mental
Health
$749.0
666.84
(82.16)
Social
Services
$522.4
470.5
(51.9)
Health
$941.2
829.83
(111.37)
$2,212.6
$1.967.17
(245.43)
TOTALS
The Old Definition of County
“Base” Allocations
The 1991 realignment legislation established each county’s share
of the amount of revenues collected in the current year as the
county’s “base” allocation.
•
All revenues in excess of this amount would be deposited in the
Sales Tax Growth Account and VLF Growth Account and then
distributed to counties according to the legislation’s growth
allocation provisions.
• Given that realignment revenues fell substantially short of the
projected base amounts, every county would have sustained a
permanent cut in health and mental health programs.
• As a result of the “base” definition, realignment “growth” revenues
would be allocated according to equity and general growth
provisions. While some counties would receive enough money
from those subaccounts to restore full funding to their local
realignment accounts, others would suffer a permanent reduction.
Passage of SB 463 Changes
Realignment Structure
With the passage of SB 463 (Chapter 100, Statutes of 1993), a
process was established for counties to receive realignment growth
revenues to restore the full $2,212 billion base as originally
estimated in 1991.
Basic Conditions of Growth Allocations:
• Growth funds are distributed when the total amount of funds
available for distribution in a fiscal year is greater than the amount
of funds available for distribution in the prior fiscal year.
• Growth funds are considered “growth funds” for only one fiscal
year.
• Growth funds allocated in a fiscal year are folded into the base
allocation for each funded account in the subsequent fiscal year.
The new “Base” Definition
SB 463 established each county’s base as being their
original share of the estimated $2,212 billion in
realignment revenues.
• Each county’s base amount then changes each year to reflect
new realignment revenues from each of the Growth Subaccounts.
• Hence, a county’s total realignment
allocation for each year equals the prior year
“base” allocation plus all funds received from
the Growth Subaccounts.
• A new county “base” amount is changed with
every year’s distribution of Growth
Subaccount Revenues.
SB 463 Realignment Structure
SB 463 Allocations of
Growth Revenues
After fully funding the Caseload
Subaccount, any remaining funds in
the Sales Tax Growth Accounts and
all VLF Growth Funds are allocated
to specified subaccounts.
•
•
Allocations to these subaccounts are
not permitted until the prior year base
allocations and Caseload Subaccounts
are fully paid.
Funds owed to the Caseload
Subaccount can carry over from yearto-year building obligations for Growth
Fund distributions that deny growth
revenues from going into Health and
Mental Health.
The Caseload Subaccount
The Caseload Subaccount has the first draw on Sales Tax Growth
Account revenues and provides funds to repay counties for the net
changes in cost-sharing ratios for:
• CalWorks
• IHSS
• CCS
• Adoptions Assistance
• Foster Care
The payments from the Caseload Subaccount are calculated based
on annual changes in caseload costs and made a year in arrears.
The payments to each county are the net of all changes in
caseload costs when compared to their costs under prerealignment cost-sharing ratios.
• CSAC reports that counties are currently owed $169.2 million for 2003-04
and 2004-05 for social services caseload growth.
Transfer of Funds Between Trust
Fund Accounts
Counties are permitted to transfer funds
between the accounts to reflect local
needs and priorities.
(Welfare & Institutions Code 17600.20)
• This transfer authority may not exceed (but may be less
than) ten percent of the amount deposited in the account
from which the funds are to be reallocated for that fiscal year.
• Transfers up to ten percent may be made between any of
the accounts for any reason, as determined by the county
Board of Supervisors.
• The State does not have any authority to disallow or
disprove of transfers made by the Board of Supervisors.
More About Transfer Authority
Counties may reallocate up to twenty percent
from the Health Account to the Social Services
Account if caseload expenditures demands
exceed the amount of realignment revenue
growth made available for net caseload
increases.
NOTE: Counties requested authority to transfer more than ten
percent out of the Mental Health Account into the other accounts.
Federal maintenance of effort requirements for the Alcohol &
Drug/Mental Health Block Grant (ADAMH) revealed that this
additional transfer authority could have jeopardized receipt of those
federal funds. Hence, the ability to transfer funds in excess of ten
percent was originally restricted to the Health Account and those
higher transfers could only be made to the Social Services Account.
Transfer Authority Changed Due
to PCSP
With the county “savings” attributed to new federal PCSP funds, the
counties were granted additional authority to transfer up to twenty
percent of the funds out of the Social Services Account to the
Health or Mental Health Account. This additional transfer authority
was enacted in SB 463.
• There were also changes in the ability to transfer
funds from the Health Account. Prior to SB 463,
counties could transfer up to ten percent from the
Health Account into the Social Services Account if
revenues were insufficient to cover mandated caseload
costs.
• SB 463 required counties to transfer the full ten
percent from both the Health and Mental Health
Account before they could transfer any additional funds
out of the Health Account.
Process Required to Transfer
Funds
Counties are required to provide documentation
regarding the use of transfers.
• Decisions and documentation must:
• Be made at a regularly scheduled public hearing of the
Board of Supervisors.
• Establish that the decision to transfer funds was based on
the most cost-effective use of available resources to
maximize client outcome.
•
If a county transfers more than ten percent
from its Health Account, it must document
that the net social services caseload has
increased beyond the revenue growth in the
Social Services Account.
Poison Pill Provisions
When the realignment statutes were negotiated, it
was unclear whether the legality of constitutionality of
any of the components would be challenged.
Therefore, there were four “poison pills” included in
AB 1288 that would make the components of
realignment inoperative under specified
circumstances.
If any of these poison pill provisions were to take
effect, the affected statute would become inoperative
within three months, with the precise timing
dependent on the particular provision.
Vehicle License Fee
Poison Pill
VLF Constitutional Issues. Although local entities receive their
realignment VLF allocations as general purpose revenues, the
realignment statute requires that each entity must then deposit
an equal amount of revenues into their health and mental health
accounts. Section 15 of Article XI of the State Constitution
requires VLF revenues to be subvened to cities and counties. If
a final appellate court decision finds that the realignment
provisions related to VLF deposits violate the Constitution, the
VLF tax increase from 1991 would be repealed.
This amendment was also sponsored by the Administration and
was enacted in AB 1288 in Section 210 (a) as an uncodified
statute.
Proposition 98 (Education)
Poison Pill
Similarly, if a final appellate court decision
finds that revenues from the half-cent
realignment sales tax are subject to
Proposition 98’s education funding guarantee,
this portion of the sales tax would be
repealed.
This poison pill was enacted by Section 211 of AB 1288.
State Mandates Poison Pill
Reimbursable Mandate Claims. If, as a result of the
realignment provisions, (1) the Commission on State Mandates
adopts a statewide cost estimate of more than $1 million or (2)
an appellate court makes a final determination that upholds a
reimbursable mandate, the general provisions regarding
realignment would become inoperative.
This poison pill was sponsored by the Administration and supported by
many Senate and Assembly Republicans as a strong disincentive to the
Legislature and other interest groups against adding new mandates to the
realigned programs. In addition, this was intended to discourage counties
from filing claims for reimbursement without first exhausting other means to
finance realigned programs.
The State Mandates Poison Pill was enacted in Section 209 (a) of AB 1288
as uncodified language.
Indigent Health Care
Poison Pill
Court Cases Related to Medically Indigent Adults. If a final
appellate court decision finds that the 1982 legislation that
transferred responsibility from the state to counties for providing
services to medically indigent adults constitutes a reimbursable
state mandate, the VLF increase would be repealed.
This provision was sponsored by the Administration in response to the
potential of state financial liability to provide counties with additional funding
for indigent health care as the Appellate Court decision required in Kinlaw.
The Supreme Court ultimately ruled against the plaintiffs in the Kinlaw case.
However, the counties of Los Angeles, San Diego and San Bernardino were
in the processing of seeking additional indigent health care funds through
the courts for mandates imposed pursuant to Chapters 328 1594 of 1982
(which transferred responsibility for adult indigent health care to the
counties).
This poison pill was enacted in AB 1288 in Section 210 (b).
Constitutional Amendment
Rejected
CSAC sponsored ACA 35
to ensure stability of the
designated realignment
revenues.
• Continuous appropriation
of realignment revenues
 Limit county liability to
received realignment
revenues
 Exempt realignment
revenues from Prop 98
 Dedicate ½ cent Sales Tax
& VLF (realignment piece)
to the Local Revenue Fund
Governor Wilson indicated conceptual
support, “A constitutional amendment
will be added to the ballot in 1992 to
provide assurance of a dedicated
funding source of Vehicle License
Fund (VLF) and sales tax dollars to
realigned programs. Realignment is
consistent with Governor Wilson’s
philosophy that better, more efficient
and more responsible government
resides at the local level.
This constitutional
amendment was not
approved by the legislature.
IHSS Changes Proposed in
Realignment Negotiations
The idea of including IHSS in
realignment was seen as a way to
potentially avoid the certainty of state
budget cuts to the program. One of the
workgroups formed by the legislature’s
conference committee on realignment
was charged with developing a proposal
to realign IHSS. Here is their proposal
to the realignment conference
committee.
Proposal from IHSS Advocates
The basics of the IHSS Advocates’ realignment
proposal:
•
Establish a county share of cost (25-30%)
•
Eligibility and service standards set by the State
•
State receives these realignment revenues from
counties to pay IHSS providers
•
Counties continue to perform assessments
using the uniform assessment tool.
•
CMIPS is preserved
CSAC Position on Transfer and/or
County Share of Cost in IHSS
The CSAC Board of Directors went
on record in opposition to
transfer of IHSS to the counties
because:
•
•
•
•
IHSS is an entitlement program and
counties could not control eligibility or
service costs.
No single revenue source would grow at
the rate of IHSS expenditure growth.
Realignment would bifurcate the longterm care continuum.
Realignment would raise the questions
about who is the employer and potentially
increase program costs.
CSAC ultimately supported IHSS
within the realignment package.
Final IHSS Changes Enacted by
Realignment
Changes to IHSS statutes were enacted in AB 948 (Chapter 91,
Statutes of 1991) and provided:
•
IHSS would continue to operate as an open-ended entitlement program in fiscal
year 1991/92 and as a capped entitlement in fiscal years 1992/93 and 1993/94.
During FY 92/93 and 93/94, counties were authorized to implement “A-E”
reductions when caseloads exceed the county’s IHSS program allocation.
(Welfare & Institutions Code 12301 (d))
•
•
•
No service reductions could be made for IHSS applicants or recipients which would
result in imminent out-of-home placement.
Counties were required to use the following priorities in implementing program
reductions:
A.
B.
C.
D.
E.
Reduction in the frequency with which nonessential services are provided.
Elimination of nonessential service categories
Termination or denial of eligibility to persons requiring only domestic services.
Termination or denial of eligibility to persons who, in the absence of services, would not require
placement in a medical out-of-home facility.
Per capita reduction in the cost of services authorized.
More on AB 948 Changes to IHSS
•
•
•
•
•
“Nonessential services” was defined as routine mending, ironing, heavy
cleaning, domestic services, yard hazard abatement (except snow
removal), teaching and demonstration, and any other service defined by the
California Department of Social Services (CDSS).
Exceptions were authorized on a case-by-case basis when denial or
termination of services would result in out-of-home placement or in a loss of
employment, in a life threatening situation where there could be a
substantial threat of the health and safety of the recipient, or under any
other conditions specified by CDSS.
Counties were required to notify CDSS if they implemented the “A-E”
reductions.
CDSS was required to notify the Joint Legislative Budget Committee and
the fiscal committee in each house of the legislature of any county that
implemented these reductions.
Established the authority for CDSS to implement a uniform assessment tool
for collecting information and evaluating the needs of IHSS applicants and
recipients. (Welfare & Institutions Code 12309)
Other AB 948 Changes to IHSS
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Required the California Health & Welfare Agency to convene a working task
force of counties, client advocates, and other state departments to make
recommendations on all of the following:
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The proper role of IHSS in the long-term care continuum, including program efficiencies
and improvements.
The feasibility of using the uniform assessment tool to determine an individual’s
functional level and need for long-term care services as a means of eliminating
duplicative assessments.
Explore methods of maximizing federal Medicaid funds for community-based long-term
care.
Improving the coordination of long-term care services, including, but not limited to preand post-admission screening for skilled nursing facilities, the Linkages program,
capitated long-term care systems, and the Multipurpose Senior Services Program.
A report from the Health & Welfare Agency to the legislature was required by
January 31, 1992.
The Health & Welfare Agency was required to investigate the feasibility of
maximizing federal funds by pursuing Medicaid matching funds for IHSS as
personal care services.
Declared legislative intent that any federal funds obtained through Medicaid for
IHSS would first be used to defray the costs of any funding deficiency in IHSS.
Welfare & Institutions Code 12309.5
New Federal Funds – PSCP
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AB 1773 (Chapter 939, Statutes of 1992) required the State
Department of Health Services to submit a State Plan Amendment
(SPA) to the federal department of Health & Human Services to include
personal care services as a federally reimbursable services under the
Medicaid program.
California received approval of the SPA on November 2, 1992.
The approval of federal PCSP generated interest in counties to use part
of their savings to improve IHSS. The concept of the IHSS Public
Authority was developed by counties, consumers, workers and state
representatives. The statute authorizing counties to establish Public
Authorities was enacted in SB 35 (Chapter 69, Statutes of 1993)and
then clarified that same year with the passage of SB 1078 (Chapter
1252, Statutes of 1993).
Realignment Legislative History
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AB 758 (Bates) – Chapter 87, Statutes of 1991: VLF
AB 948 (Bronzan) – Chapter 91, Statutes of 1991: Social Services Realignment
Provisions
AB 1288 (Bronzan) – Chapter 89, Statutes of 1991: Health Provisions &
Structure of Realignment Accounts
AB 1491 (Bronzan) – Chapter 611, Statutes of 1991: Realignment Clean-up
SB 463 (Bergeson) – Chapter 100, Statutes of 1993: Base Restoration
SB 651 (Wright) – Chapter 484, Statutes of 1994: Mental Health Realignment
Changes
SB 1648 (Wright) – Chapter 642, Statutes of 1998: Sales Tax Growth & VLF
Growth changes pertaining to the Caseload Subaccount
AB 1716 (Wolk – Assembly Human Services Committee) – Chapter 450,
Statutes of 2003: Realignment Base Restoration & Caseload Subaccount
SB 1096 (Senate Budget & Fiscal Review Committee) – Chapter 211, Statutes
of 2002: VLF & Indigent Health Poison Pill
Realignment Funding 101
A presentation for the
California Association of Public Authorities
by Karen Keeslar
July 26, 2006