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Adult Day Health Services Budget Looks Familiar

The recent state budget proposal includes the expected cost of the Community-Based Adult Services program for next year: roughly $83 million.

That number is eerily close to last year’s budget estimate for the Keeping Adults Free from Institutions program, which was an alternative adult day services plan that the Legislature passed in June. The Legislature approved $85 million for the KAFI program, which was designed as a half-price replacement for the adult day health care program.

Gov. Jerry Brown (D) vetoed KAFI.

A lawsuit over the ADHC transition plan was settled in December 2011, and that settlement was approved last week by a federal judge. The CBAS program, born as part of that settlement, will replace the current ADHC program beginning March 1 when ADHC is eliminated as a Medi-Cal benefit.

Overall, California expects to spend about half of last year’s $171 million ADHC budget, according to Mark Helmar of the Department of Health Care Services. In part, that’s because only about half of current beneficiaries are expected to be eligible for CBAS, and also because beneficiaries will receive care from managed care providers, Helmar said.

“The state will realize savings in part because of the shift to managed care,” Helmar said. “That eliminated some of the fee-for-service costs.”

Helmar explained that the state spent $150 million on the ADHC transition itself, but more than $131 million of that went to an eight-month extension of ADHC benefits by DHCS, while the transition plans were being worked out.

So the transition itself — the administrative costs of working out a transition plan, sending out notices to beneficiaries, establishing a hotline and paying for health risk assessments for those 35,000 ADHC recipients — all comes to approximately $18 million, Helmar said.

That, of course, does not include legal fees.

It’s possible the estimated cost of the CBAS program could still rise or fall, depending on the number of people who qualify for the program, Helmar said. Those changes could appear in the May budget revision.

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