California Legislature Passes Bill to Protect California Children's Services, But State Still Seeking Overhaul


Larene Pare says California Children's Services has helped her coordinate care for her daughter Niara. - FILE PHOTO / BERT JOHNSON
  • file photo / bert johnson
  • Larene Pare says California Children's Services has helped her coordinate care for her daughter Niara.
California lawmakers have approved legislation that would temporarily protect a longstanding public health program that serves children with chronic, life-threatening, and disabling conditions — a program that state health officials have recently sought to dismantle. The California Department of Health Care Services (DHCS) has for months faced significant backlash over its proposal to overhaul California Children's Services (CCS) by moving children out of the state program and into managed healthcare plans.

That transition would have meant that low-income children with very serious conditions would no longer have had a state program coordinating their care — which can often be very expensive and require multiple specialized services — and instead would have had health insurance organizations overseeing their healthcare and treatment plans. Critics of the DHCS plan, including a coalition of children's hospitals and local county health officials, had argued that this reorganization could have fatal consequences by limiting the services medically fragile kids receive. Health advocates have feared that, under the DHCS proposal, patients who currently rely on a statewide system of doctors would have struggled to access specialty providers outside of the managed healthcare plans' more limited networks. 

Now, lawmakers have passed legislation that would preserve CCS in its current form until January 2017. Assembly Bill 187, sponsored by Assemblymember Rob Bonta (D-Oakland), states that California cannot move CCS children into managed healthcare plans until 2017 — with the exception of a few counties that have voluntarily made this transition — effectively maintaining the status quo for the next year. The Assembly and Senate both unanimously supported the bill, and the groups that have vocally opposed the DHCS plan to restructure CCS are now urging Governor Jerry Brown to sign the legislation into law.

State health officials, however, told the Express today that even if AB 187 becomes law, DHCS still intends to move forward with efforts to transition children into managed care — starting in 2017. Although news reports this week said AB 187 would delay the state's plan, quoting CCS families praising the legislation, DHCS said the bill would not impact its existing proposal (called the "Whole Child Model") and that it is continuing to roll out the changes on the timeline it announced earlier this year. 

Some quick background on the program: CCS currently serves 190,000 children under the age of 21 who suffer from a range of chronic and serious conditions (such as cystic fibrosis, hemophilia, heart disease, and cancer). The children must also be financially eligible (if families are low-income or if out-of-pocket medical expenses are exorbitant relative to a family's income). CCS further provides therapy services to all children with certain qualifying conditions, regardless of income.

DHCS' plans to overhaul CCS and move children into managed care plans first sparked controversy in 2014. Since then, the state has said that it has taken critics' concerns into consideration and in June of this year proposed a more modest plan that would involve counties transitioning to managed care models for CCS in phases over the next four years. If the governor does not sign AB 187 into law, the state would technically have the authority to start moving children into managed care plans as early as January 2016 under current law (although some opponents say a major overhaul of that nature would also require separate legislative approval). 

In the state's June proposal to revamp CCS, however, health officials suggested transitioning about two-dozen counties from CCS to a managed care model starting in 2017 and then in 2019 potentially directing the remaining counties to follow suit. DHCS said today that it is on track with this timeline. In an email, DHCS spokesperson Norman Williams said that starting in 2017, CCS-eligible children in twenty counties — roughly 31,000 kids — will transition to the managed care model. "The child would be under the umbrella of a single managed care health plan that would coordinate their care," he said, noting that the selected counties include 17 percent of all current CCS children in the state. (Alameda and Contra Costa counties are not included in this group). The one-year extension of CCS in its current form through AB 187 "will not impact the state’s work to prepare for this transition of a small part of the CCS population," he added.

But health advocates who have opposed DHCS's plan said AB 187 sends a clear message that the state needs to go back to the drawing board and devise a plan that CCS families, hospitals, and other advocates will support — or otherwise keep the main structures of CCS intact. And given legislators' decision to at least temporarily preserve the program, advocates said they hoped that state officials would not move forward with any major changes to the program until they've done much more significant analysis and community outreach over the next year — and get buy-in from lawmakers.

The extension of the program until 2017 would give the state the opportunity to work with county health officials and other advocates to create an alternative plan to reform CCS that would not compromise children's care or erode the current system of services for the state's sickest kids, advocates said. Critics of the state's initiative have argued that there are ways CCS could improve its current operations to be more efficient and effective for families, but that having managed health plans take over these patients would be too risky. 

"Let's continue the discussion and see if we can come to some agreement amongst all the players," said Ann-Louise Kuhns, president of the California Children’s Hospital Association, which has opposed DHCS' plans. And considering that so many families depend on the program and have expressed concerns about a managed care model, she added, "We could really use more time, and we could really use a process that allows for more input from across the state." Kuhns also argued that DHCS' plan to transition CCS kids into managed care requires legislation. 

But Williams, the state spokesperson, disagreed, writing in email that legislation is not required to make the transition in 2017 with the first round of counties.