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Highlights of recent LAO publications

In response to the changes to the state’s budget process required by the pandemic, our office will be publishing shorter, more focused budget analyses over the next few months. Given this change, rather than sending out an announcement for each publication, we will provide periodic updates with the key takeaways from our recent pieces. The highlights of our recent work are below. All of our 2021-22 budget analyses to date can be found here.

CalAIM: New Directions for Services for Seniors and Persons With Disabilities

  • CalAIM Includes Several Provisions With Significant Implications for Seniors and Persons With Disabilities (SPDs). The administration’s California Advancing and Innovating Medi-Cal (CalAIM) proposal is a far-reaching set of reforms to expand, transform, and streamline Medi-Cal service delivery and financing. SPDs are a key target population of CalAIM. Elements of CalAIM that would directly affect care for Medi-Cal SPDs include: (1) instituting a new statewide managed care benefit that would provide intensive case management and care coordination for Medi-Cal’s highest-risk and highest-need beneficiaries; (2) requiring managed care plans to engage in new population health management strategies; and (3) reimbursing plans for “in lieu of” services, which are nonmedical benefits such as personal care and housing navigation. Additionally, CalAIM would enact structural changes to SPD care, including expanding the role of managed care in nursing home care. Finally, the CalAIM proposal references the administration’s longer-term vision to integrate all Medi-Cal SPD care into managed care.
  • Proposal Could Bring Benefits to SPDs, but Significant Questions Remain. CalAIM has the potential to improve incentives for managed care plans to provide supportive services and coordinate care for SPDs. It also could create an incentive to plans to emphasize cost-effective alternatives to nursing home care and improve coordination between Medi-Cal and Medicare. However, there are still many outstanding questions about how the proposal would be implemented, monitored, and evaluated. For example, the details of the administration’s long-term plan for the inclusion of long-term services and supports in managed care are unknown. We suggest the Legislature focus on resolving these key questions in the budget process.
  • Legislature Could Consider Steps to Further Reduce Fragmentation of the State’s SPD Care System. Although CalAIM has the potential to significantly improve coordination of care for SPDs, there are additional steps the Legislature could consider toward creating a more integrated Medi-Cal system of SPD care. For example, Medi-Cal SPDs currently are subject to a different assessment and referral process for each long-term services and supports program they might utilize. The Legislature could consider creating a standard assessment and referral process for these programs to streamline the process of enrolling in multiple programs simultaneously.
This article was released by the California Legislative Analyst’s Office.