OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 ↓ (860) 240-0200

http: //www. cga. ct. gov/ofa

sSB-30

AN ACT IMPLEMENTING PROVISIONS OF THE BUDGET CONCERNING HUMAN SERVICES.

OFA Fiscal Note

State Impact:

Note: GF=General Fund

Municipal Impact: None

Explanation

Sections 1 and 15 of the bill eliminate statutory provisions concerning Medicaid hospital rate setting. There is no fiscal impact as this rate setting methodology has been superseded by more recent statutory provisions.

Section 2 specifies that Medicaid dental benefit limitations are specific to the Medicaid client, regardless of how many providers serve the client. This provision would presumably reduce utilization of dental services. The Department of Social Services (DSS) spends approximately $185 million on dental benefits annually. sHB 5014, (the Budget Bill), as favorably reported by the Appropriations Committee, includes savings of $1. 74 million for this initiative.

Section 3 extends the period for which DSS can use federal fiscal year 2009 data in setting Medicaid and disproportionate share hospital (DSH) payments. While this provision may alter the amount paid to individual hospitals, it does not change the aggregate amount the state pays out of the DSH or Medicaid program.

Sections 4 and 5 allow DSS to lower reimbursement rates for community living arrangements (CLA's) and intermediate care facilities for the mentally retarded (ICF/MR's) when facilities experience significant reductions in land and building costs. sHB 5014 assumes savings of $5. 2 million from these reductions.

Section 6 requires veterans and their families who apply for or receive Medicaid to also apply for federal Veteran's Administration or Department of Defense benefits. Should this result in federal benefits supplanting Medicaid benefits, the state would realize savings. It is not known how many Medicaid clients could be affected by the change. No savings were included in sHB 5014 for this policy.

Sections 7 and 8 expand the private pay assisted living pilot from 75 to 125 individuals. This expansion is expected to cost the state funded Connecticut Home Care Program for the Elders (CHCPE) approximately $950,000 when annualized ($19,000 per slot). However, it is expected to result in an equal level of savings in the Medicaid program by diverting individuals from more expensive nursing home care. sHB 5014 transfers funding between Medicaid and CHCPE to reflect this expansion.

Section 9 requires enrollees of the Medicaid Personal Care Assistance (PCA) Waiver program to enroll in the CHCPE upon reaching the age of 65. This will allow the PCA waiver program to serve additional individuals who are currently on a wait list. sHB 5014 includes funding of $600,000 to reflect the provision of additional services.

Section 10 requires DSS to continue to provide administrative support to the new Bureau of Rehabilitative Services until June 30, 2013 or until the bureau requests the cessation of such services. There is no net state cost from this provision as it specifies which agency provides administrative services.

Sections 11 and 12 remove certain child care related responsibilities from DSS and require the State Department on Education (SDE), not DSS, to make certain before and afterschool grants. Although HB 5014 originally transferred $3. 3 million in child care and quality enhancement funding from DSS to SDE, the substitute language in sHB 5014 did not transfer these funds.

Section 13 requires certain home health care agencies to provide for the administration of non-injectible medications by staff other than licensed nurses, at the discretion of the treating physician. This policy would be limited to recipients of the Money Follow the Person (MFP) program. Approximately 300 clients transitioned onto the MFP program in FY 11. It is anticipated that the Medicaid program would realize savings through this use of unlicensed personnel rather than nurses to administer medications¹. However, it is not known how many MFP clients utilize this service. Additionally, section 14 specifies that the fee schedule in effect for FY 12 for nurse medication administration shall not be reduced in FY 13. As this limits DSS's discretion to reduce rates as it can otherwise under current law, potential savings are forgone. DSS currently spends approximately $113 million annually on home health medication administration.

sHB 5014 assumed savings of $10. 3 million related to reduced home health medication administration services through utilization of an Administrative Service Organization and the use of assistive technology.

Section 15, which has no fiscal impact, repeals a statutory reference to a two year pilot program for reliable transportation. The pilot had a sunset date of 2000.

The Out Years

The annualized ongoing fiscal impact identified above would continue into the future subject to inflation.