Bill Text: CA AB1565 | 2015-2016 | Regular Session | Introduced
Bill Title: Developmental services: funding.
Spectrum: Moderate Partisan Bill (Republican 10-1-1)
Status: (Failed) 2016-11-30 - From committee without further action. [AB1565 Detail]
Download: California-2015-AB1565-Introduced.html
BILL NUMBER: AB 1565 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Lackey
(Principal coauthors: Assembly Members Baker, Chávez, Grove,
Linder, Patterson, and Wilk)
(Principal coauthor: Senator Stone)
(Coauthors: Assembly Members Achadjian, Bigelow, Maienschein, and
Mayes)
JANUARY 4, 2016
An act to amend Sections 4629.7, 4681.1, 4681.6, 4689.8, 4691.9,
and 4860 of, and to add Sections 4519.8, 4681.2, 4690.7, 4793, and
4794 to, the Welfare and Institutions Code, relating to developmental
services, and declaring the urgency thereof, to take effect
immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1565, as introduced, Lackey. Developmental services: funding.
The Lanterman Developmental Disabilities Services Act requires the
State Department of Developmental Services to contract with regional
centers to provide services and supports to individuals with
developmental disabilities. Under existing law, the regional centers
purchase needed services for individuals with developmental
disabilities through approved service providers or arrange for those
services through other publicly funded agencies.
This bill would require the department to submit a plan to the
Legislature by August 1, 2017, to ensure the sustainability, quality,
and transparency of community-based services for individuals with
developmental disabilities. The bill would require the department to
regularly consult with stakeholders in developing the plan and would
require the plan to address specified topics, including, among
others, recommendations for a comprehensive approach to funding
regional center operations in a sustainable and transparent manner
that enables regional centers to deliver high-quality services to
consumers.
Existing law requires that contracts or agreements between
regional centers and service providers in which the rates between the
regional center and the service provider are determined through
negotiations to ensure that not more than 15% of regional center
funds be spent on administrative costs, as described.
This bill would instead provide that the percentage of the funds
that may be spent on administrative costs varies depending on the
total value, annually, of the payments received by a service provider
from all regional centers.
Existing law establishes specified rates to be paid to certain
service providers and the rates to be paid for certain developmental
services. Existing law requires that rates to be paid to other
developmental service providers either be set by the department or
negotiated between the regional center and the service provider.
Existing law prohibits certain provider rate increases, but
authorizes increases to those rates as necessary to adjust employee
wages to meet the state minimum wage law.
This bill would increase the rates established by existing law, as
specified, and would require an increase to the rates set by the
department and the rates negotiated between regional centers and
service providers, as specified. The bill would also require the
department, when setting rates for community care facilities serving
people with developmental disabilities, to ensure that the rates
permit the viability of those facilities by establishing different
rates for each facility size, as determined by the number of beds
available, that reflect reasonable differences in the cost structure
of facilities with differing numbers of beds. The bill would require
the department to adopt emergency regulations implementing that
provision.
Existing law requires each regional center to submit, on or before
August 1 of each year, to the department and the State Council on
Developmental Disabilities a program budget plan for the subsequent
budget year. Existing law provides that, to the extent feasible, all
funds appropriated for developmental disabilities programs be
allocated to those programs by August 1 of each year and designates
the department as the agency responsible for the processing, audit,
and payment of funds made available to regional centers.
This bill would require the department to increase the funding
paid to a regional center for the regional center's operating budget,
beginning July 1, 2016, by 10% above the amount the regional center
otherwise would have received under the department's core staffing
formula, and, beginning July 1, 2017, by 10% above the amount the
regional center otherwise would have received under the department's
core staffing formula, plus a percentage equal to the percentage of
any increase in the California Consumer Price Index since July 1,
2016. The bill would also require the department to increase the
funding provided to a regional center to enable the regional center
and the regional center's purchase-of-service vendors to fund certain
costs related to minimum wage requirements.
This bill would declare that it is to take effect immediately as
an urgency statute.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. (a) The Legislature finds and declares all of the
following:
(1) California's vision to promote fulfilling lives for persons
with developmental disabilities launched in 1969 with the passage of
the Lanterman Developmental Disabilities Services Act, authored by
Assembly Member Frank Lanterman and signed by Governor Ronald Reagan.
However, the Lanterman Act's vision is now threatened by neglect of
the community service system and wasteful spending on outdated state
institutions.
(2) The current funding system for regional center operations and
for community-based services is inadequate and outdated. The funding
currently provided has not kept pace with the cost of delivering
high-quality services. Funding formulas and ratesetting methods are
archaic and ill-suited to promote an effective and efficient
community system that delivers high-quality services to consumers.
(3) The result of inadequate funding for community services and
onerous requirements on providers can be seen in the decline of the
number of vendors serving the community. As documented in the January
2015 Fact Book issued by the State Department of Developmental
Services, the number of vendors declined by 30 percent from 2009-10
to 2013-14, inclusive, despite an increase of 12 percent in the
number of consumers served in the community. The Association of
Regional Center Agencies also reports that 435 licensed residential
homes and 57 day and work programs have closed since July 2011.
(4) California must recommit itself to vibrant and sustainable
community services that maximize opportunities for persons with
developmental disabilities to thrive in their own neighborhoods.
(5) It is imperative that the Legislature take action to ensure
the viability of the community service system by paying sustainable
reimbursement rates, streamlining requirements for community service
providers, and fairly funding the regional center system to
administer services.
(b) Accordingly, it is the intent of the Legislature to enact
short-term increases in reimbursement rates for community services
providers while undertaking a stakeholder process with specific
deadlines to develop and implement long-term reforms to accomplish
these goals. It is also the intent of the Legislature to establish
requirements for greater regional center transparency with respect to
rates paid to vendors and the amount and type of services provided
to consumers across the spectrum of regional center services. It is
further the intent of the Legislature that the provisions added by
this act only remain in place until a revised, comprehensive rate
system that provides adequate and transparent funding for
community-based services, including supported employment, is
implemented.
SEC. 2. Section 4519.8 is added to the Welfare and Institutions
Code, immediately following Section 4519.7, to read:
4519.8. (a) The department shall submit a plan to the Legislature
to ensure the sustainability, quality, and transparency of
community-based services for individuals with developmental
disabilities. The department shall regularly consult with
stakeholders in developing the plan. The department shall submit the
plan to the Legislature by August 1, 2017. The plan shall include,
but not be limited to, all of the following:
(1) An assessment of the effectiveness of the methods used to pay
each category of community service provider. This assessment shall
include consideration of the following factors for each category of
service provider:
(A) Whether the current method of ratesetting for a service
category is ensuring an adequate supply of providers in that
category, including, but not limited to, whether there is a
sufficient supply of providers to enable a consumer to have a choice
of providers.
(B) A comparison of the likely fiscal effects of using the
following methodologies for each service provider category:
(i) Negotiated rates, which may be limited to regional medians or
other limits.
(ii) Rates established through regulations on either a statewide
or regionally adjusted basis.
(iii) Alternate rate methodologies that may use combinations of
negotiated or regulatory rates on either a statewide or regionally
adjusted basis.
(2) An evaluation of the appropriateness of the number and type of
service codes for regional center services, including, but not
limited to, recommendations for making service codes more reflective
of the level and type of services provided and for reducing the
number and type of services that are billed with a service code of
"Miscellaneous."
(3) Recommendations for a comprehensive purchase-of-services rate
structure that would ensure a sustainable, high-quality, and
transparent community services system.
(4) An assessment of the adequacy of the number and locations of
regional centers for providing timely service to consumers. This
assessment shall consider, at a minimum, all of the following
factors:
(A) The waiting time for consumers to obtain appointments with
regional center personnel.
(B) The distance consumers must travel for in-person meetings with
regional center personnel.
(C) The type and frequency of interactions between consumers and
regional center personnel that can be accommodated remotely through
electronic means, including, but not limited to, electronic mail,
video conferencing, or telehealth.
(D) Whether the number of consumers and the geographic size of the
catchment area served by each regional center are reasonable for
delivering high-quality service to consumers and their families.
(E) Whether additional regional centers or regional center
locations are necessary to address any identified deficiencies in
access to regional center personnel, or whether technology-enabled
means of access or other solutions are warranted.
(5) Recommendations for a comprehensive approach to funding
regional center operations in a sustainable and transparent manner
that enables regional centers to deliver high-quality services to
their consumers, including, but not limited to, recommendations and
estimated costs for increasing the number of regional centers or
altering catchment areas.
(b) The report submitted to the Legislature pursuant to
subdivision (a) shall be submitted in compliance with Section 9795 of
the Government Code.
SEC. 3. Section 4629.7 of the Welfare and Institutions Code is
amended to read:
4629.7. (a) Notwithstanding any other provision of
law, all regional center contracts or agreements with
service providers in which rates are determined through negotiations
between the regional center and the service provider shall expressly
require that not more than 15 percent of regional center
funds be spent on administrative costs. For
the amount of funds specified in paragraphs (1) to (3), inclusive,
be spent on administrative costs.
(1) For service providers who receive payments from one or more
regional centers totaling two million dollars ($2,000,000) or more
annually from those regional centers, 15 percent of regional center
funds.
(2) For service providers who receive payments from one or more
regional centers totaling less than two million dollars ($2,000,000),
but more than five hundred thousand dollars ($500,000), annually
from those regional centers, 20 percent of regional center funds.
(3) For service providers who receive payments from one or more
regional centers totaling five hundred thousand dollars ($500,000) or
less annually from those regional centers, 25 percent of regional
center funds.
(b) For purposes of
this subdivision, direct service expenditures are those costs
immediately associated with the services to consumers being offered
by the provider. Funds spent on direct services shall not include any
administrative costs. Administrative costs include, but are not
limited to, any of the following:
(1) Salaries, wages, and employee benefits for managerial
personnel whose primary purpose is the administrative management of
the entity, including, but not limited to, directors and chief
executive officers.
(2) Salaries, wages, and benefits of employees who perform
administrative functions, including, but not limited to, payroll
management, personnel functions, accounting, budgeting, and facility
management.
(3) Facility and occupancy costs, directly associated with
administrative functions.
(4) Maintenance and repair.
(5) Data processing and computer support services.
(6) Contract and procurement activities, except those provided by
a direct service employee.
(7) Training directly associated with administrative functions.
(8) Travel directly associated with administrative functions.
(9) Licenses directly associated with administrative functions.
(10) Taxes.
(11) Interest.
(12) Property insurance.
(13) Personal liability insurance directly associated with
administrative functions.
(14) Depreciation.
(15) General expenses, including, but not limited to,
communication costs and supplies directly associated with
administrative functions.
(b)
(c) Notwithstanding any other provision of
law, all contracts between the department and the regional
centers shall require that not more than 15 percent of all funds
appropriated through the regional center's operations budget shall be
spent on administrative costs. For purposes of this subdivision,
"direct services" includes, but is not limited to, service
coordination, assessment and diagnosis, monitoring of consumer
services, quality assurance, and clinical services. Funds spent on
direct services shall not include any administrative costs. For
purposes of this subdivision, administrative costs include, but are
not limited to, any of the following:
(1) Salaries, wages, and employee benefits for managerial
personnel whose primary purpose is the administrative management of
the regional center, including, but not limited to, directors and
chief executive officers.
(2) Salaries, wages, and benefits of employees who perform
administrative functions, including, but not limited to, payroll
management, personnel functions, accounting, budgeting, auditing, and
facility management.
(3) Facility and occupancy costs, directly associated with
administrative functions.
(4) Maintenance and repair.
(5) Data processing and computer support services.
(6) Contract and procurement activities, except those performed by
direct service employees.
(7) Training directly associated with administrative functions.
(8) Travel directly associated with administrative functions.
(9) Licenses directly associated with administrative functions.
(10) Taxes.
(11) Interest.
(12) Property insurance.
(13) Personal liability insurance directly associated with
administrative functions.
(14) Depreciation.
(15) General expenses, including, but not limited to,
communication costs and supplies directly associated with
administrative functions.
(c)
(d) Consistent with subdivision (a),
subdivisions (a) and (b), service providers and
contractors, upon request, shall provide regional centers with access
to any books, documents, papers, computerized data, source
documents, consumer records, or other records pertaining to the
service providers' and contractors' negotiated rates.
SEC. 4. Section 4681.1 of the Welfare and Institutions Code is
amended to read:
4681.1. (a) The department shall adopt regulations that specify
rates for community care facilities serving persons with
developmental disabilities. The implementation of the regulations
shall be contingent upon an appropriation in the annual Budget Act
for this purpose. These rates shall be calculated on the basis of a
cost model designed by the department that ensures that aggregate
facility payments support the provision of services to each person in
accordance with his or her individual program plan and applicable
program requirements. The cost model shall reflect cost elements that
shall include, but are not limited to, all of the following:
(1) "Basic living needs" include utilities, furnishings, food,
supplies, incidental transportation, housekeeping, personal care
items, and other items necessary to ensure a quality environment for
persons with developmental disabilities. The amount identified for
the basic living needs element of the rate shall be calculated as the
average projected cost of these items in an economically and
efficiently operated community care facility.
(2) "Direct care" includes salaries, wages, benefits, and other
expenses necessary to supervise or support the person's functioning
in the areas of self-care and daily living skills, physical
coordination mobility, and behavioral self-control, choice making,
and integration. The amount identified for direct care shall be
calculated as the average projected cost of providing the level of
service required to meet each person's functional needs in an
economically and efficiently operated community care facility. The
direct care portion of the rate shall reflect specific service levels
defined by the department on the basis of relative resident need and
the individual program plan.
(3) "Special services" include specialized training, treatment,
supervision, or other services that a person's individual program
plan requires to be provided by the residential facility in addition
to the direct care provided under paragraph (2). The amount
identified for special services shall be calculated for each
individual based on the additional services specified in the person's
individual program plan and the prevailing rates paid for similar
services in the area. The special services portion of the rate shall
reflect a negotiated agreement between the facility and the regional
center in accordance with Section 4648.
(4) "Indirect costs" include managerial personnel, facility
operation, maintenance and repair, other nondirect care, employee
benefits, contracts, training, travel, licenses, taxes, interest,
insurance, depreciation, and general administrative expenses. The
amount identified for indirect costs shall be calculated as the
average projected cost for these expenses in an economically and
efficiently operated community care facility.
(5) "Property costs" include mortgages, leases, rent, taxes,
capital or leasehold improvements, depreciation, and other expenses
related to the physical structure. The amount identified for property
costs shall be based on the fair rental value of a model facility
that is adequately designed, constructed, and maintained to meet the
needs of persons with developmental disabilities. The amount
identified for property costs shall be calculated as the average
projected fair rental value of an economically and efficiently
operated community care facility.
(b) The cost model shall take into account factors that include,
but are not limited to, all of the following:
(1) Facility size, as defined by the department on the basis of
the number of facility beds licensed by the State Department of
Social Services and vendorized by the regional center.
(2) Specific geographic areas, as defined by the department on the
basis of cost of living and other pertinent economic indicators.
(3) Common levels of direct care, as defined by the department on
the basis of services specific to an identifiable group of persons as
determined through the individual program plan.
(4) Positive outcomes, as defined by the department on the basis
of increased integration, independence, and productivity at the
aggregate facility and individual consumer level.
(5) Owner-operated and staff-operated reimbursement, which shall
not differ for facilities that are required to comply with the same
program requirements.
(c) The rates established for individual community care facilities
serving persons with developmental disabilities shall reflect all of
the model cost elements and rate development factors described in
this section. The cost model design shall include a process for
updating the cost model elements that address variables, including,
but not limited to, all of the following:
(1) Economic trends in California.
(2) New state or federal program requirements.
(3) Changes in the state or federal minimum wage.
(4) Increases in fees, taxes, or other business costs.
(5) Increases in federal supplemental security income/state
supplementary program for the aged, blind, and disabled payments.
(d) Rates established for persons with developmental disabilities
who are also dually diagnosed with a mental health disorder may be
fixed at a higher rate. The department shall work with the State
Department of Health Care Services to establish criteria upon which
higher rates may be fixed pursuant to this subdivision. The higher
rate for persons with developmental disabilities who are also dually
diagnosed with a mental health disorder may be paid when requested by
the director of the regional center and approved by the Director of
Developmental Services.
(e) By January 1, 2001, the department shall prepare proposed
regulations to implement the changes outlined in this section. The
department may use a private firm to assist in the development of
these changes and shall confer with consumers, providers, and other
interested parties concerning the proposed regulations. By May 15,
2001, and each year thereafter, the department shall provide the
Legislature with annual community care facility rates, including any
draft amendments to the regulations as required. By July 1, 2001, and
each year thereafter, contingent upon an appropriation in the annual
Budget Act for this purpose, the department shall adopt emergency
regulations that establish the annual rates for community care
facilities serving persons with developmental disabilities for each
fiscal year.
(f) During the first year of operation under the revised rate
model, individual facilities shall be held harmless for any reduction
in aggregate facility payments caused solely by the change in
reimbursement methodology.
(g) (1) The department shall ensure that rates established for
community care facilities serving persons with developmental
disabilities permit the viability of those facilities, including, but
not limited to, four-bed facilities, by establishing different rates
for each facility size, as determined by the number of beds
available, that reflect reasonable differences in the cost structure
of facilities with differing numbers of beds.
(2) The department shall adopt emergency regulations, within 30
days of the effective date of the amendments adding this subdivision,
to implement this subdivision. The adoption, amendment, repeal, or
readoption of a regulation authorized by this paragraph is deemed to
be necessary for the immediate preservation of the public peace,
health and safety, or general welfare, for purposes of Sections
11346.1 and 11349.6 of the Government Code, and the department is
hereby exempted from the requirement that it describe specific facts
showing the need for immediate action.
SEC. 5. Section 4681.2 is added to the Welfare and Institutions
Code, to read:
4681.2. (a) Notwithstanding any other law, commencing July 1,
2016, the department shall increase the rates set for community care
facilities serving persons with developmental disabilities by 10
percent above the levels that otherwise would have been in effect as
of July 1, 2016. Commencing July 1, 2017, except as specified in
subdivision (b), the department shall increase those rates by a
percentage equal to the percentage of any increase in the California
Consumer Price Index since July 1, 2016.
(b) The rate increase described in subdivision (a) that is
required to commence July 1, 2017, shall only be made if the Budget
Act of 2017 does not implement alternative rate increases or rate
reforms based on the plan required by Section 4519.8.
(c) The funding increases authorized in this section shall only be
made if the increase would not result in a reduction to the amount
of federal matching funds available for these services.
SEC. 6. Section 4681.6 of the Welfare and Institutions Code is
amended to read:
4681.6. (a) Notwithstanding any other law or regulation,
law, commencing July 1, 2008:
(1) A regional center shall not pay an existing residential
service provider, for services where for
which rates are determined through a
negotiation between the regional center and the provider, a rate
higher than the rate in effect on June 30, 2008, unless the increase
is required by a contract between the regional center and the vendor
that is in effect on June 30, 2008, or the regional center
demonstrates that the approval is necessary to protect the consumer's
health or safety and the department has granted prior written
authorization.
(2) A regional center shall not negotiate a rate with a new
residential service provider, for services where
for which rates are determined through a
negotiation between the regional center and the provider,
that is higher than the regional center's median rate for the same
service code and unit of service, or the statewide median rate for
the same service code and unit of service, whichever is lower. The
unit of service designation shall conform with an existing regional
center designation or, if none exists, a designation used to
calculate the statewide median rate for the same service. The
regional center shall annually certify to the department its median
rate for each negotiated rate service code, by designated unit of
service. This certification shall be subject to verification through
the department's biennial fiscal audit of the regional center.
(b) Notwithstanding subdivision (a), commencing July 1, 2014,
regional centers may negotiate a rate adjustment with residential
service providers regarding rates that are otherwise restricted
pursuant to subdivision (a), if the adjustment is necessary in order
to pay employees no less than the minimum wage as established by
Section 1182.12 of the Labor Code, as amended by Chapter 351 of the
Statutes of 2013, and only for the purpose of adjusting payroll costs
associated with the minimum wage increase. The rate adjustment shall
be specific to the unit of service designation that is affected by
the increased minimum wage, shall be specific to payroll costs
associated with any increase necessary to adjust employee pay only to
the extent necessary to bring pay into compliance with the increased
state minimum wage, and shall not be used as a general wage
enhancement for employees paid above the minimum wage. Regional
centers shall maintain documentation on the process to determine, and
the rationale for granting, any rate adjustment associated with the
minimum wage increase.
(c) Notwithstanding subdivision (a), commencing July 1, 2015,
regional centers may negotiate a rate adjustment with residential
service providers regarding rates that are otherwise restricted
pursuant to subdivision (a), if the adjustment is necessary to
implement Article 1.5 (commencing with Section 245) of Chapter 1 of
Part 1 of Division 2 of the Labor Code, as added by Chapter 317 of
the Statutes of 2014. The rate adjustment may be applied only if a
minimum of 24 hours or three days of paid sick leave per year was not
a benefit provided to employees as of June 30, 2015, and shall be
specific to payroll costs associated with any increase necessary to
compensate an employee up to a maximum of 24 hours or three days of
paid sick leave in each year of employment.
(c) (1) Notwithstanding subdivision (a), commencing July 1, 2016,
regional centers shall increase the rates paid to residential service
providers, for services for which rates are determined through
negotiation between the regional center and the provider, by 10
percent above the levels that otherwise would have been in effect on
July 1, 2016. Commencing July 1, 2017, except as specified in
paragraph (2), the regional centers shall increase those rates by a
percentage equal to the percentage of any increase in the California
Consumer Price Index since July 1, 2016.
(2) The rate increase described in paragraph (1) that is required
to commence July 1, 2017, shall only be made if the Budget Act of
2017 does not implement alternative rate increases or rate reforms
based on the plan required by Section 4519.8.
(3) The funding increases authorized in this subdivision shall
only be made if the increase would not result in a reduction to the
amount of federal matching funds available for these services.
(d) For purposes of this section, "residential service provider"
includes Adult Residential Facilities for Persons with Special Health
Care Needs, as described in Section 4684.50.
(e) This section shall not apply to those services for which rates
are determined by the State Department of Health Care Services, or
the State Department of Developmental Services, or are usual and
customary.
SEC. 7. Section 4689.8 of the Welfare and Institutions Code is
amended to read:
4689.8. (a) Notwithstanding any other
provision of law or regulation, law,
commencing July 1, 2008:
(a) No
(1) A regional center
may shall not pay an existing supported living
service provider, for services where for
which rates are determined through a
negotiation between the regional center and the provider, a rate
higher than the rate in effect on June 30, 2008, unless the increase
is required by a contract between the regional center and the vendor
that is in effect on June 30, 2008, or the regional center
demonstrates that the approval is necessary to protect the consumer's
health or safety and the department has granted prior written
authorization.
(b) No
(2) A regional center
may shall not negotiate a rate with a new
supported living service provider, for services where
for which rates are determined through a
negotiation between the regional center and the provider,
that is higher than the regional center's median rate for the same
service code and unit of service, or
the statewide median rate for the same service code and
unit of service, whichever is lower. The unit of service designation
shall conform with an existing regional center designation or, if
none exists, a designation used to calculate the statewide median
rate for the same service. The regional center shall annually certify
to the State Department of Developmental Services its median rate
for each negotiated rate service code, by designated unit of service.
This certification shall be subject to verification through the
department's biennial fiscal audit of the regional center.
(b) (1) Notwithstanding subdivision (a), commencing July 1, 2016,
regional centers shall increase the rates paid to supported living
service providers, for services for which rates are determined
through negotiation between the regional center and the provider, by
10 percent above the levels that otherwise would have been in effect
on July 1, 2016. Commencing July 1, 2017, except as specified in
paragraph (2), the regional centers shall increase those rates by a
percentage equal to the percentage of any increase in the California
Consumer Price Index since July 1, 2016.
(2) The rate increase described in paragraph (1) that is required
to commence July 1, 2017, shall only be made if the Budget Act of
2017 does not implement alternative rate increases or rate reforms
based on the plan required by Section 4519.8.
(3) The funding increases authorized in this subdivision shall
only be made if the increase would not result in a reduction to the
amount of federal matching funds available for these services.
SEC. 8. Section 4690.7 is added to the Welfare and Institutions
Code, to read:
4690.7. (a) Notwithstanding any other law, commencing July 1,
2016, the department shall increase the rates set for nonresidential
service providers by 10 percent above the levels that otherwise would
have been in effect on July 1, 2016. Commencing July 1, 2017, except
as specified in subdivision (b), the department shall increase those
rates by a percentage equal to the percentage of any increase in the
California Consumer Price Index since July 1, 2016.
(b) The rate increase described in subdivision (a) that is
required to commence July 1, 2017, shall only be made if the Budget
Act of 2017 does not implement alternative rate increases or rate
reforms based on the plan required by Section 4519.8.
(c) The funding increases authorized in this section shall only be
made if the increase would not result in a reduction to the amount
of federal matching funds available for these services.
SEC. 9. Section 4691.9 of the Welfare and Institutions Code is
amended to read:
4691.9. (a) Notwithstanding any other law or regulation,
law, commencing July 1, 2008:
(1) A regional center shall not pay an existing service provider,
for services where rates are determined through a negotiation between
the regional center and the provider, a rate higher than the rate in
effect on June 30, 2008, unless the increase is required by a
contract between the regional center and the vendor that is in effect
on June 30, 2008, or the regional center demonstrates that the
approval is necessary to protect the consumer's health or safety and
the department has granted prior written authorization.
(2) A regional center shall not negotiate a rate with a new
service provider, for services where rates are determined through a
negotiation between the regional center and the provider, that is
higher than the regional center's median rate for the same service
code and unit of service, or the statewide median rate for the same
service code and unit of service, whichever is lower. The unit of
service designation shall conform with an existing regional center
designation or, if none exists, a designation used to calculate the
statewide median rate for the same service. The regional center shall
annually certify to the State Department of Developmental Services
its median rate for each negotiated rate service code, by designated
unit of service. This certification shall be subject to verification
through the department's biennial fiscal audit of the regional
center.
(b) Notwithstanding subdivision (a), commencing July 1, 2014,
regional centers may negotiate a rate adjustment with providers
regarding rates if the adjustment is necessary in order to pay
employees no less than the minimum wage as established by Section
1182.12 of the Labor Code, as amended by Chapter 351 of the Statutes
of 2013, and only for the purpose of adjusting payroll costs
associated with the minimum wage increase. The rate adjustment shall
be specific to the unit of service designation that is affected by
the increased minimum wage, shall be specific to payroll costs
associated with any increase necessary to adjust employee pay only to
the extent necessary to bring pay into compliance with the increased
state minimum wage, and shall not be used as a general wage
enhancement for employees paid above the increased minimum wage.
Regional centers shall maintain documentation on the process to
determine, and the rationale for granting, any rate adjustment
associated with the minimum wage increase.
(c) Notwithstanding any other law or regulation,
law, commencing January 1, 2015, rates for
personal assistance and supported living services in effect on
December 31, 2014, shall be increased by 5.82 percent, subject to
funds specifically appropriated for this increase for costs due to
changes in federal regulations implementing the federal Fair Labor
Standards Act of 1938 (29 U.S.C. Sec. 201 et seq.). The increase
shall be applied as a percentage, and the percentage shall be the
same for all applicable providers. As used in this subdivision, both
of the following definitions shall apply:
(1) "Personal assistance" is limited only to those services
provided by vendors classified by the regional center as personal
assistance providers, pursuant to the miscellaneous services
provisions contained in Title 17 of the California Code of
Regulations.
(2) "Supported living services" are limited only to those services
defined as supported living services in Title 17 of the California
Code of Regulations.
(d) Notwithstanding subdivision (a), commencing July 1, 2015,
regional centers may negotiate a rate adjustment with existing
service providers for services for which rates are determined through
negotiation between the regional center and the provider, if the
adjustment is necessary to implement Article 1.5 (commencing with
Section 245) of Chapter 1 of Part 1 of Division 2 of the Labor Code,
as added by Chapter 317 of the Statutes of 2014. The rate adjustment
may be applied only if a minimum of 24 hours or three days of paid
sick leave per year was not a benefit provided to employees as of
June 30, 2015, and shall be specific to payroll costs associated with
any increase necessary to compensate an employee up to a maximum of
24 hours or three days of paid sick leave in each year of employment.
(d) (1) Notwithstanding subdivision (a), commencing July 1, 2016,
regional centers shall increase the rates paid to service providers,
for services for which rates are determined through negotiation
between the regional center and the provider, by 10 percent above the
levels that otherwise would have been in effect on July 1, 2016.
Commencing July 1, 2017, except as specified in paragraph (2), the
regional centers shall increase those rates by a percentage equal to
the percentage of any increase in the California Consumer Price Index
since July 1, 2016.
(2) The rate increase described in paragraph (1) that is required
to commence July 1, 2017, shall only be made if the Budget Act of
2017 does not implement alternative rate increases or rate reforms
based on the plan required by Section 4519.8.
(3) The funding increases authorized in this subdivision shall
only be made if the increase would not result in a reduction to the
amount of federal matching funds available for these services.
(e) This section shall not apply to those services for which rates
are determined by the State Department of Health Care Services, or
the State Department of Developmental Services, or are usual and
customary.
SEC. 10. Section 4793 is added to the Welfare and Institutions
Code, to read:
4793. (a) The department shall increase the funding provided to a
regional center for the regional center's operating budget as
follows:
(1) Beginning July 1, 2016, increase the amount paid under the
core staffing formula by 10 percent.
(2) Beginning July 1, 2017, increase the amount paid under the
core staffing formula by 10 percent, plus a percentage equal to the
percentage of any increase in the California Consumer Price Index
since July 1, 2016.
(b) The rate increase described in paragraph (2) of subdivision
(a) that is required to commence July 1, 2017, shall only be made if
the Budget Act of 2017 does not implement alternative rate increases
or regional center funding reforms based on the plan required by
Section 4519.8.
(c) The funding increases authorized in this section shall only be
made if the increase would not result in a reduction to the amount
of federal matching funds available for these services.
SEC. 11. Section 4794 is added to the Welfare and Institutions
Code, to read:
4794. (a) The department shall increase the funding provided to a
regional center to enable the regional center and regional center's
purchase-of-service vendors to fund all of the following costs
associated with minimum wage requirements:
(1) The costs necessary to comply with a statewide minimum wage
requirement.
(2) The costs necessary to comply with minimum wage requirements
enacted by local governments that exceed the statewide minimum wage.
(3) The costs necessary to increase compensation for exempt,
salaried employees to comply with wage orders issued by the
Industrial Welfare Commission or any other state regulatory agency.
(4) Any other wage adjustments that vendors are required to make
in response to minimum wage increases mandated by state or federal
statutes, regulations, or other authorities.
(b) The funding increases required by this section shall be in
addition to the funding increases required by Sections 4681.2,
4681.6, 4689.8, 4690.7, 4691.9, 4793, and 4860, as those sections
were added or amended by the act that added this section.
SEC. 12. Section 4860 of the Welfare and Institutions Code is
amended to read:
4860. (a) (1) The Except as provided in
subdivision (f), the hourly rate for supported
employment services provided to consumers receiving individualized
services shall be thirty thirty-four
dollars and eighty-two twenty-four
cents ($30.82). ($34.24).
(2) Job coach hours spent in travel to consumer worksites may be
reimbursable for individualized services only when the job coach
travels from the vendor's headquarters to the consumer's worksite or
from one consumer's worksite to another, and only when the travel is
one way.
(b) The Except as provided in subdivision
(f), the hourly rate for group services shall be
thirty thirty-four dollars and
eighty-two twenty-four cents ($30.82),
($34.24) regardless of the number of consumers
served in the group. Consumers in a group shall be scheduled to start
and end work at the same time, unless an exception that takes into
consideration the consumer's compensated work schedule is approved in
advance by the regional center. The department, in consultation with
stakeholders, shall adopt regulations to define the appropriate
grounds for granting these exceptions. When the number of consumers
in a supported employment placement group drops to fewer than the
minimum required in subdivision (r) of Section 4851, the regional
center may terminate funding for the group services in that group,
unless, within 90 days, the program provider adds one or more
regional centers, or Department of Rehabilitation-funded supported
employment consumers to the group.
(c) Job coaching hours for group services shall be allocated on a
prorated basis between a regional center and the Department of
Rehabilitation when regional center and Department of Rehabilitation
consumers are served in the same group.
(d) When Section 4855 applies, fees shall be authorized for the
following:
(1) A three-hundred-sixty-dollar ($360)
four-hundred-dollar ($400) fee shall be paid to the program
provider upon intake of a consumer into a supported employment
program. No fee shall be paid if that consumer completed a supported
employment intake process with that same supported employment program
within the previous 12 months.
(2) A seven-hundred-twenty-dollar ($720)
An eight-hundred-dollar ($800) fee shall be paid upon placement
of a consumer in an integrated job, except that no fee shall be paid
if that consumer is placed with another consumer or consumers
assigned to the same job coach during the same hours of employment.
(3) A seven-hundred-twenty-dollar ($720)
An eight-hundred-dollar ($800) fee shall be paid
after a 90-day retention of a consumer in a job, except that no fee
shall be paid if that consumer has been placed with another consumer
or consumers, assigned to the same job coach during the same hours of
employment.
(e) Notwithstanding paragraph (4) of subdivision (a) of Section
4648, the regional center shall pay the supported employment program
rates established by this section.
(f) (1) Commencing July 1, 2017, the rates established by
subdivisions (a) and (b) shall be thirty-seven dollars and sixty-six
cents ($37.66).
(2) The rate increase described in paragraph (1), shall only be
made if the Budget Act of 2017 does not implement alternative rate
increases or regional center funding reforms based on the plan
required by Section 4519.8.
SEC. 13. The Legislature declares that the changes made by this
act are not intended to result in the substantial impairment of any
contract. To the extent any contract would be substantially impaired
as a result of the application of any change made by this act, it is
the intent of the Legislature that the change apply only to contracts
renewed or entered into on or after the effective date of this act.
SEC. 14. This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:
In order to ensure that the necessary increases in the rates paid
for services provided to persons with developmental disabilities and
in the hourly rates for supported employment services provided to
consumers receiving individualized services take effect as soon as
possible, it is necessary that this act take immediate effect.
