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Think Tank

Counties Face New, Expanded Health Care Challenges

California’s 58 counties face an array of health care challenges — some new, some longstanding but about to grow. Realignment is shifting more responsibility for health care from state to county governments, a lingering recession is making it increasingly difficult to make budgets balance at every governmental level and big changes are under way as part of the Affordable Care Act.

For years, California’s disparate county governments — as different and far removed from each other as some of the United States are from each other —  have played a leading role in providing medical and mental health care for low-income, underserved and uninsured populations.

That role — interpreted differently by each county using a patchwork of federal and state programs and funding — is about to become more complex, if not more difficult. The influx of millions of newly insured Californians along with added tasks from the state and what appears to be a long-term financial pinch make for rocky roads ahead.

While their responsibilities are usually limited to a portion of the population, counties’ successes and failures at delivering health care can have a significant impact on the whole population.

We asked stakeholders and experts to predict what strategies might help policymakers navigate health care challenges. What pitfalls and problems are looming and how can they be avoided?

We got responses from:

Reexamine State and County Roles in Enrollment

While realignment in California may be shifting more responsibility for health care from state to county governments, there is an important function where realignment could move in the other direction — enrollment into health insurance programs. A shift in responsibilities here could free up county resources, including personnel who could be redeployed from time- and paper-intensive processes for enrolling and renewing individuals in Medi-Cal to other vital functions in helping individuals obtain needed health care, such as outreach and care coordination.

Tools to facilitate this shift are at hand in the Affordable Care Act, the federal health care reform law that calls for new, streamlined enrollment systems for Medi-Cal, Healthy Families, the California Health Benefit Exchange, as well as the Basic Health Option, should the state elect to establish this program.

Federal funding is available to cover from 90% to 100% of the costs of developing technology enabled systems with “no wrong doors” to enroll individuals into any of the programs for which they are eligible. Developing modern, integrated, state-of-the-art enrollment systems can enable centralization of many functions that are now carried out by county caseworkers, again freeing up their time to provide more assistance to individuals not only in obtaining health insurance, but in using the health care system more effectively.

More information on ACA’s provisions and the challenges and opportunities for states can be found in “Paving an Enrollment Superhighway: Bridging State Gaps Between 2014 and Today,” a report from the National Academy for State Health Policy that was supported by the California HealthCare Foundation. (CHCF publishes California Healthline.)

Over on the other side of the country, New York state, which also has a strong county-based system and some other similarities to California in the composition and needs of its residents, has decided to undertake such a realignment. Legislation was passed in 2010 to shift administrative responsibilities for Medicaid to the state, and a November 2010 report outlined the first steps toward accomplishing this shift by 2016. Included are key principles and a thoughtful analysis of functions that California’s state and county policymakers could employ as guideposts in considering potential realignment of functions.

Now is the time to review carefully what functions are best carried out at the state level and which at the county level, and how these two levels of government can work together and with private sector partners to meet better the health needs of California’s residents.

In an extremely challenging environment, there is a window of opportunity open now, with federal financing, technology, and the experience of other states to help California examine the options and consider the potential rewards of increased efficiency and consumer satisfaction in realigning enrollment responsibilities.

Counties Should Position Themselves as 'Providers of Choice'

Growth in patient demand, rising costs, dwindling government funding and a more clinically compromised population are the hallmarks of California’s county health care safety net systems.  From Siskiyou County to Los Angeles County, California’s counties have demonstrated resiliency by serving more residents with fewer resources.

Health reform and the state’s 1115 Medicaid demonstration waiver have the potential to heighten these challenges if counties are not proactive in making improvements to their delivery systems.  Both provisions will increase the demand for services and health care professionals.

The Association of American Medical Colleges estimates that by 2020, the United States will face a shortage of approximately 45,000 primary care physicians and 46,000 surgeons and medical specialists.  Since there may never be a sufficient number of clinicians to meet demand, states and counties should invest in innovative information technology solutions that spur expanded capacity, improved access, enhanced quality and demonstrated efficiency.

What looms over all county health care systems is the tangible fear that indigent care funding will be drastically reduced while millions of uninsured Californians continue to seek care from our systems. Under health reform, hospital disproportionate share funding will decrease and state realignment funds are likely to be reduced significantly to help fund health insurance for the newly insured.  Uninsured patients who have relied on county systems by default will be offered a choice under health reform via Medi-Cal or the California Health Benefits Exchange.  Funding will follow their health care choice.

We can and should be their choice of provider. These are, after all, many of our patients.

Almost four years ago, San Francisco launched its Healthy San Francisco program, which provides comprehensive access to health care to almost 55,000 uninsured adults through a network of public and private providers.  Our experience indicates that county safety net systems can help mitigate some of the health care challenges by establishing primary care homes, investing in information technology, increasing coordination of care and improving customer service to.

By making these investments now, county delivery systems can position themselves as “providers of choice,” help preserve public funding and ensure better health outcomes.

Counties Should Think Strategically, Plan Ahead

As policymakers balance today’s pressing budget burdens by shifting fiscal responsibilities to local governments combined with the new opportunities presented by the Affordable Care Act, they must avoid the temptation to implement quick health care fixes. Instead, they must invest in California’s health for the long-term.

Challenges and opportunities are exemplified by the decision now facing county policymakers: whether and how to implement Low Income Health Programs (LIHPs)  as allowed by California’s 1115 Medicaid Waiver, which went into effect last November.

Under the waiver, counties have the opportunity to draw down federal funds starting this year to improve and expand health care for certain low-income adults. The population targeted by the waiver is primarily composed of low-income adults who are not currently eligible for Medi-Cal, but will become eligible under Medicaid expansion in 2014. This population largely overlaps with the population to whom counties are charged with providing “subsistence medical care” under the Welfare & Institutions Code.

Counties must think strategically about designing LIHPs that maximize federal revenue to the county, while ensuring investment in the health care safety net — not only for the next few years, but for 2014 and beyond. The waiver presents an opportunity for counties to establish programs that will be attractive to low-income consumers after 2014, when many of those low-income consumers will have a choice of health care plans through expanded Medi-Cal.

Counties that draw down new federal dollars to offer consumers the same old health care program risk losing the federal investment in their safety net if those consumers are dissatisfied and leave to seek care elsewhere when their choices are expanded in a few years.

California will continue to need a health care safety net after 2014, to ensure that those who are not eligible for new programs or who slip through the cracks still have a last-resort option to receive basic medical care.  California’s counties have been charged with providing this last-resort safety net for more than 100 years. They are the logical entity to continue to provide it.

But counties that fail to plan for their role beyond 2014 risk losing important revenues that can fund their health care infrastructure and leaving their low-income residents without the important medical services they need.

Resist Urge to Start From Scratch

California is very well-positioned in comparison to many other states to embark on health care reform in large part because of the experience counties bring to the table in administering eligibility and enrollment for an array of health and human service assistance programs

More than 8.6 million Californians currently receive access to Medi-Cal, CalFresh (food stamps) and CalWORKs benefits through a large-scale, automated system that supports mail-in and online applications, paired with in-person customer service when needed. The system was thoughtfully designed and executed under a successful partnership between counties and the state.

California will succeed if it builds upon what works and stays true to the no-wrong-door approach the federal Affordable Care Act envisions. That includes the ability for people to apply in person, online, by mail or by phone. Coordination across eligibility and enrollment entities, robust information technology support, and preserving the face-to-face interaction many people need will all be vital to ensuring this broad vision is realized.

One significant move counties have recently made to accommodate more people — particularly in this time of increased demand for assistance due to the recession — is creating a statewide online portal to help individuals apply online regardless of their county of residence. The site connects people to applications for Medi-Cal, the County Medical Services Program, CalFresh and CalWORKs benefits in California. California has embraced the automation shift while also recognizing the need to maintain a level of human contact for families with complex situations or a need to speak in person with a knowledgeable eligibility worker.

California can avoid pitfalls and problems by avoiding the urge to start from scratch in implementing health care reform and instead taking the least-risky and most cost-effective path, — building on the systems that already exist.

As a key partner in efforts to ensure maximum enrollment into health coverage programs on day one, county social services agencies are uniquely positioned to provide our essential on-the-ground perspective. And it’s this perspective that has allowed counties to serve the diverse populations across the state. We know what works in Alpine County may not work in Los Angeles County, and we also know that what is developed for 2014 needs to work for residents across the economic spectrum, not just the lowest-income families.

County social services agencies intend to continue to play an important role in health coverage for our residents in the coming years — both before and after 2014.

Opportunities, Challenges for Mental Health System

Gov. Jerry Brown believes that government-funded services are more efficiently and effectively delivered where they are “closer to the people.”  Building on a state-county “realignment” of health, mental health and social services in 1992, he has proposed another significant restructuring of how California delivers mental health, public safety and social services to its population.

By most accounts, the 1992 mental health realignment allowed and, in fact, incentivized counties to move people away from state hospitals and other institutional settings, and into more appropriate, less restrictive community-based settings.  If done right, the new proposed realignment would complete the successful transition from the state to counties of all programmatic and fiscal responsibility for community-based mental health programs.

From a county mental health perspective, there are pros and cons to such a realignment, depending on, for example:

  • How sufficient and reliable the funding source is, particularly for the federal entitlement programs;
  • Properly aligned risks, responsibilities and incentives;
  • Meaningful state oversight and a system to measure outcomes;  and
  • Collaboration.

These are not small issues, and there are still major unanswered questions related to them at this writing.  From a purely programmatic perspective, however, realigning full responsibility specifically for the Medi-Cal Specialty Mental Health  and Early and Periodic Screening, Diagnosis and Treatment programs to counties, as proposed,  makes sense — if done right.

County mental health plans — under contract with the state — already operate Medi-Cal “”specialty mental health”” programs under a federally approved Medicaid 1915(b) “freedom of choice” waiver and two state plan amendments. As such, they are currently responsible for assuring statewide access to medically necessary emergency, hospital, post-hospital stabilization, case management and rehabilitative mental health services for all eligible Medi-Cal beneficiaries, and for providing the federal certified public expenditure for these mental health services.

Realigning these mental health and other public safety and human services programs entirely to counties with a new and sufficient dedicated revenue source would almost certainly lead to significant and much-needed administrative efficiencies at both the state and local levels.

However, if this proposal is to accomplish the goals envisioned by the governor and shared by counties, the governor and Legislature must work closely and collaboratively with counties to address the issues outlined above.  We look forward to the opportunity to make sure that together, we do it right.