SECTIONS 4680-4684 - California Statutes

WELFARE AND INSTITUTIONS CODE

SECTION 4680-4684

4680. In order to assure the availability of a continuum of
community living facilities of good quality for persons with
developmental disabilities, and to ensure that persons placed out of
home are in the most appropriate, least restrictive living
arrangement, the department shall establish and maintain an equitable
system of payment to providers of such services. The system of
payment shall include provision for a rate to ensure that the
provider can meet the special needs of persons with developmental
disabilities and provide quality programs required by this article.

4681. By July 1, 1977, and each year thereafter, the department
shall establish rates, which shall be reviewed by the state council.
Such rates shall annually be proposed to the Legislature by March 1
and shall be operative on July 1 of each year, subject to the
appropriation of sufficient funds for such purpose in the Budget Act.
In reviewing the sufficiency of these rates that is required by
March 1, 1985, the department shall take into account the findings
and recommendations of the study conducted by the State Council on
Developmental Disabilities pursuant to Section 4541.
In establishing rates to be paid for out-of-home care, the
department shall include each of the cost elements in this section as
follows:
(a) Rates established for all facilities shall include an adequate
amount to care for "basic living needs" of a person with
developmental disabilities. "Basic living needs" are defined to
include housing (shelter, utilities, and furnishings), food, and
personal care. The amount required for basic living needs shall be
calculated each year as the average cost of an additional normal
child, of the ages of 12 to 17, inclusive, living at home. The amount
for basic living needs shall be adjusted depending on the size of
the out-of-home facility. These amounts shall be adjusted annually to
reflect cost-of-living changes. A redetermination of basic living
costs shall be undertaken every three years by the State Department
of Developmental Services, using the best available estimating
methods.
(b) Rates established for all facilities that provide direct
supervision for persons with developmental disabilities shall include
an amount for "direct supervision." The cost of "direct supervision"
shall reflect the ability of the persons in the facility to function
with minimal, moderate, or intensive supervision. Minimal
supervision means that a developmentally disabled person needs the
assistance of other persons with certain daily activities. Moderate
supervision means that a developmentally disabled person needs the
assistance of other persons with daily activities most of the time.
Intensive supervision means that all the personal and physical needs
of a developmentally disabled person are provided by other persons.
The individual program plan developed pursuant to Section 4646 shall
determine the amount of "direct supervision" required for each
individual. The cost of "direct supervision" is calculated as the
wage costs of care-giving staff depending on the needs of the person
with developmental disabilities. These rates shall be adjusted
annually to reflect wage changes and shall comply with all federal
regulations for hospitals and residential-care establishments under
provisions of the federal Fair Labor Standards Act.
(c) Rates established for all facilities that provide "special
services" for persons with developmental disabilities shall include
an amount to pay for these "special services" for each person
receiving special services. "Special services" include medical and
dental care and therapeutic, educational, training, or other services
required in the individual program plan of each person. Facilities
shall be paid for providing special services for each individual to
the extent that such services are specified in the person's
individual program plan and the facility is designated provider of
such special services. Rates of payment for special services shall be
the same as prevailing rates paid for similar services in the area.
(d) To the extent applicable, rates established for facilities
shall include a reasonable amount for "unallocated services." Such
costs shall be determined using generally accepted accounting
principles. "Unallocated services" means the indirect costs of
managing a facility and includes costs of managerial personnel,
facility operation, maintenance and repair, employee benefits, taxes,
interest, insurance, depreciation, and general and administrative
support. If a facility serves other persons in addition to
developmentally disabled persons, unallocated services expenses shall
be reimbursed under the provision of this section, only for the
proportion of the costs associated with the care of developmentally
disabled persons.
(e) Rates established for facilities shall include an amount to
reimburse facilities for the depreciation of "mandated capital
improvements and equipment" as established in the state's uniform
accounting manual. For purposes of this section, "mandated capital
improvements and equipment" are only those remodeling and equipment
costs incurred by a facility because an agency of government has
required such remodeling or equipment as a condition for the use of
the facility as a provider of out-of-home care to persons with
developmental disabilities.
(f) When applicable, rates established for proprietary facilities
shall include a reasonable "proprietary fee."
(g) Rates established for all facilities shall include as a
"factor" an amount to reflect differences in the cost of living for
different geographic areas in the state.
(h) Rates established for developmentally disabled persons who are
also mentally disordered may be fixed at a higher rate. The State
Department of Mental Health shall establish criteria upon which
higher rates may be fixed pursuant to this subdivision. The higher
rate for developmentally disabled persons who are also mentally
disordered may be paid when requested by the director of the regional
center and approved by the Director of Developmental Services.
This section shall apply to rates for facilities not participating
in the alternative residential care rate model originally authorized
in Item 4300-101-001 of the Budget Act of 1985, and as identified in
the department's report of April 1987 entitled Alternative
Residential Model (ARM).
(i) Except as provided in subdivision (j), this section shall
remain in effect only until January 1, 1991, and as of that date is
repealed, unless a later enacted statute, which is enacted before
January 1, 1991, deletes or extends that date.
(j) This section shall not be repealed until the State Department
of Developmental Services achieves statewide implementation of the
Alternative Residential Model.

4681.1. (a) The department shall adopt regulations that specify
rates for community care facilities serving persons with
developmental disabilities. The implementation of the regulations
shall be contingent upon an appropriation in the annual Budget Act
for this purpose. These rates shall be calculated on the basis of a
cost model designed by the department which ensures that aggregate
facility payments support the provision of services to each person in
accordance with his or her individual program plan and applicable
program requirements. The cost model shall reflect cost elements that
shall include, but are not limited to, all of the following:
(1) "Basic living needs" include utilities, furnishings, food,
supplies, incidental transportation, housekeeping, personal care
items, and other items necessary to ensure a quality environment for
persons with developmental disabilities. The amount identified for
the basic living needs element of the rate shall be calculated as the
average projected cost of these items in an economically and
efficiently operated community care facility.
(2) "Direct care" includes salaries, wages, benefits, and other
expenses necessary to supervise or support the person's functioning
in the areas of self-care and daily living skills, physical
coordination mobility, and behavioral self-control, choice making,
and integration. The amount identified for direct care shall be
calculated as the average projected cost of providing the level of
service required to meet each person's functional needs in an
economically and efficiently operated community care facility. The
direct care portion of the rate shall reflect specific service levels
defined by the department on the basis of relative resident need and
the individual program plan.
(3) "Special services" include specialized training, treatment,
supervision, or other services which a person's individual program
plan requires to be provided by the residential facility in addition
to the direct care provided under paragraph (2). The amount
identified for special services shall be calculated for each
individual based on the additional services specified in the person's
individual program plan and the prevailing rates paid for similar
services in the area. The special services portion of the rate shall
reflect a negotiated agreement between the facility and the regional
center in accordance with Section 4648.
(4) "Indirect costs" include managerial personnel, facility
operation, maintenance and repair, other nondirect care, employee
benefits, contracts, training, travel, licenses, taxes, interest,
insurance, depreciation, and general administrative expenses. The
amount identified for indirect costs shall be calculated as the
average projected cost for these expenses in an economically and
efficiently operated community care facility.
(5) "Property costs" include mortgages, leases, rent, taxes,
capital or leasehold improvements, depreciation, and other expenses
related to the physical structure. The amount identified for property
costs shall be based on the fair rental value of a model facility
which is adequately designed, constructed, and maintained to meet the
needs of persons with developmental disabilities. The amount
identified for property costs shall be calculated as the average
projected fair rental value of an economically and efficiently
operated community care facility.
(b) The cost model shall take into account factors which include,
but are not limited to, all of the following:
(1) Facility size, as defined by the department on the basis of
the number of facility beds licensed by the State Department of
Social Services and vendorized by the regional center.
(2) Specific geographic areas, as defined by the department on the
basis of cost of living and other pertinent economic indicators.
(3) Common levels of direct care, as defined by the department on
the basis of services specific to an identifiable group of persons as
determined through the individual program plan.
(4) Positive outcomes, as defined by the department on the basis
of increased integration, independence, and productivity at the
aggregate facility and individual consumer level.
(5) Owner-operated and staff-operated reimbursement which shall,
not differ for facilities that are required to comply with the same
program requirements.
(c) The rates established for individual community care facilities
serving persons with developmental disabilities shall reflect all of
the model cost elements and rate development factors described in
this section. The cost model design shall include a process for
updating the cost model elements that address variables, including,
but not limited to, all of the following:
(1) Economic trends in California.
(2) New state or federal program requirements.
(3) Changes in the state or federal minimum wage.
(4) Increases in fees, taxes, or other business costs.
(5) Increases in federal supplemental security income/state
supplementary program for the aged, blind, and disabled payments.
(d) Rates established for developmentally disabled persons who are
also dually diagnosed with a mental disorder may be fixed at a
higher rate. The department shall work with the State Department of
Mental Health to establish criteria upon which higher rates may be
fixed pursuant to this subdivision. The higher rate for
developmentally disabled persons who are also dually diagnosed with a
mental disorder may be paid when requested by the director of the
regional center and approved by the Director of Developmental
Services.
(e) By January 1, 2001, the department shall prepare proposed
regulations to implement the changes outlined in this section. The
department may use a private firm to assist in the development of
these changes and shall confer with consumers, providers, and other
interested parties concerning the proposed regulations. By May 15,
2001, and each year thereafter, the department shall provide the
Legislature with annual community care facility rates, including any
draft amendments to the regulations as required. By July 1, 2001, and
each year thereafter, contingent upon an appropriation in the annual
Budget Act for this purpose, the department shall adopt emergency
regulations which establish the annual rates for community care
facilities serving persons with developmental disabilities for each
fiscal year.
(f) During the first year of operation under the revised rate
model, individual facilities shall be held harmless for any reduction
in aggregate facility payments caused solely by the change in
reimbursement methodology.

4681.3. (a) Notwithstanding any other provision of this article,
for the 1996-97 fiscal year, the rate schedule authorized by the
department in operation June 30, 1996, shall be increased based upon
the amount appropriated in the Budget Act of 1996 for that purpose.
The increase shall be applied as a percentage, and the percentage
shall be the same for all providers.
(b) Notwithstanding any other provision of this article, for the
1997-98 fiscal year, the rate schedule authorized by the department
in operation on June 30, 1997, shall be increased based upon the
amount appropriated in the Budget Act of 1997 for that purpose. The
increase shall be applied as a percentage, and the percentage shall
be the same for all providers.
(c) Notwithstanding any other provision of this article, for the
1998-99 fiscal year, the rate schedule authorized by the department
in operation on June 30, 1998, shall be increased commencing July 1,
1998, based upon the amount appropriated in the Budget Act of 1998
for that purpose. The increase shall be applied as a percentage, and
the percentage shall be the same for all providers.
(d) Notwithstanding any other provision of this article, for the
1998-99 fiscal year, the rate schedule authorized by the department
in operation on December 31, 1998, shall be increased January 1,
1999, based upon the cost-of-living adjustments in the Supplemental
Security Income/State Supplementary Program for the Aged, Blind, and
Disabled appropriated in the Budget Act of 1998 for that purpose. The
increase shall be applied as a percentage and the percentage shall
be the same for all providers.
(e) Notwithstanding any other provision of this article, for the
1999-2000 fiscal year, the rate schedule authorized by the department
in operation on June 30, 1999, shall be increased July 1, 1999,
based upon the amount appropriated in the Budget Act of 1999 for that
purpose. The increase shall be applied as a percentage and the
percentage shall be the same for all providers.
(f) In addition, commencing January 1, 2000, any funds available
from cost-of-living adjustments in the Supplemental Security
Income/State Supplementary Payment (SSI/SSP) for the 1999-2000 fiscal
year shall be used to further increase the community care facility
rate. The increase shall be applied as a percentage, and the
percentage shall be the same for all providers.
(g) Notwithstanding any other provision of law or regulation, for
the 2006-07 fiscal year, the rate schedule in effect on June 30,
2006, shall be increased on July 1, 2006, by 3 percent, subject to
funds specifically appropriated for this increase in the Budget Act
of 2006. The increase shall be applied as a percentage and the
percentage shall be the same for all providers. Any subsequent
increase shall be governed by Sections 4681.5 and 4681.6.

4681.4. (a) Notwithstanding any other provision of this article,
for the 1998-99 fiscal year, the rate schedule increased pursuant to
subdivision (d) of Section 4681.3 shall be increased by an additional
amount on January 1, 1999, based upon the amount appropriated in the
Budget Act of 1998 for that purpose. The rate increase permitted by
this section shall be applied as a percentage, and the percentage
shall be the same for all providers.
(b) Notwithstanding any other provision of this article, for the
1999-2000 fiscal year, the rate schedule authorized by the department
in operation on December 31, 1999, shall be increased on January 1,
2000, based upon the amount appropriated in the Budget Act of 1999
for that purpose. The rate increase permitted by this section shall
be applied as a percentage and the percentage shall be the same for
all providers.
(c) In order to help reduce direct care staff turnover and improve
overall quality of care in Alternative Residential Model (ARM)
facilities, funds appropriated by the Budget Act of 1998 and the
Budget Act of 1999 to increase facility rates effective January 1,
1999, excluding any additional funds appropriated due to increases in
benefits under Article 5 (commencing with Section 12200) of Chapter
3 of Part 3 of Division 9, and January 1, 2000, respectively, shall
be used only for any of the following:
(1) Increasing direct care staff salaries, wages, and benefits.
(2) Providing coverage while direct care staff are in training
classes or taking a training or competency test pursuant to Section
4681.5.
(3) Other purposes approved by the director.
(d) ARM providers shall report to regional centers, in a format
and frequency determined by the department, information necessary for
the department to determine, through the regional center, compliance
with subdivision (c), including, but not limited to, direct care
staff salaries, wages, benefits, and staff turnover.
(e) The department shall adopt emergency regulations in order to
implement this section, which shall include, but are not limited to,
the following:
(1) A process for enforcing the requirements of subdivisions (c)
and (d).
(2) Consequences to an ARM provider for failing to comply with the
requirements of subdivisions (c) and (d), including a process for
obtaining approval from the director for the expenditure of funds for
other purposes, as permitted by paragraph (3) of subdivision (c).
(3) A process for adjudicating provider appeals.

4681.5. Notwithstanding any other provision of law or regulation,
no regional center may approve any service level for a residential
service provider, as defined in Section 56005 of Title 17 of the
California Code of Regulations, if the approval would result in an
increase in the rate to be paid to the provider that is greater than
the rate that is in effect on June 30, 2008, unless the regional
center demonstrates to the department that the approval is necessary
to protect the consumer's health or safety and the department has
granted prior written authorization.

4681.6. Notwithstanding any other provision of law or regulation,
commencing July 1, 2008:
(a) No regional center may pay an existing residential service
provider, for services where rates are determined through a
negotiation between the regional center and the provider, a rate
higher than the rate in effect on June 30, 2008, unless the increase
is required by a contract between the regional center and the vendor
that is in effect on June 30, 2008, or the regional center
demonstrates that the approval is necessary to protect the consumer's
health or safety and the department has granted prior written
authorization.
(b) No regional center may negotiate a rate with a new residential
service provider, for services where rates are determined through a
negotiation between the regional center and the provider, that is
higher than the regional center's median rate for the same service
code and unit of service, or the statewide median rate for the same
service code and unit of service, whichever is lower. The unit of
service designation must conform with an existing regional center
designation or, if none exists, a designation used to calculate the
statewide median rate for the same service. The regional center shall
annually certify to the department its median rate for each
negotiated rate service code, by designated unit of service. This
certification will be subject to verification through the department'
s biennial fiscal audit of the regional center.
(c) For purposes of this section, "residential service provider"
includes Adult Residential Facilities for Persons with Special Health
Care Needs, as described in Section 4684.50.
(d) This section shall not apply to those services for which rates
are determined by the State Department of Health Care Services, or
the State Department of Developmental Services, or are usual and
customary.

4682. Under no circumstances shall the rate of state payment to any
provider of out-of-home care exceed the average amount charged to
private clients residing in the same facility, nor shall the monthly
rate of state payment to any such facility, with the exception of a
licensed acute care or emergency hospital, exceed the average monthly
cost of services for all persons with developmental disabilities who
reside in state hospitals.

4683. It is the intent of the Legislature that rates of payment for
out-of-home care shall be established in such ways as to assure the
maximum utilization of all federal and other sources of funding, to
which persons with developmental disabilities are legally entitled,
prior to the commitment of state funds for such purposes.

4684. (a) Notwithstanding any other provision of law, the cost of
providing 24-hour out-of-home nonmedical care and supervision in
community care facilities licensed or approved pursuant to Chapter 3
(commencing with Section 1500) of Division 2 of the Health and Safety
Code shall be funded by the Aid to Families with Dependent
Children-Foster Care (AFDC-FC) program pursuant to Section 11464, for
children who are both AFDC-FC recipients and regional center
consumers.
(b) The cost of providing adoption assistance benefits, shall be
funded by the Adoption Assistance Program (AAP) under Section 16121,
for children who are both AAP recipients and regional center
consumers.
(c) (1) For regional center consumers who are recipients of
AFDC-FC benefits, regional centers shall purchase or secure the
services that are contained in the child's Individualized Family
Service Plan (IFSP) or Individual Program Plan (IPP), but which are
not allowable under federal or state AFDC-FC provisions.
(2) For regional center consumers who are recipients of AAP
benefits, regional centers shall purchase or secure the services that
are contained in the child's IFSP or IPP.
(3) For regional center consumers receiving services under
paragraph (1) or (2), these services shall be separately purchased or
secured by the regional center, pursuant to Sections 4646 to 4648,
inclusive, and Section 4685, and pursuant to Sections 95018 and 95020
of the Government Code. AFDC-FC and AAP benefits shall not be
counted toward the gross income calculated for the purposes of the
Family Cost Participation Program pursuant to Section 4783.
Recipients of AFDC-FC benefits shall not be subject to the Family
Cost Participation Program requirements.
(4) Regional centers shall accept referrals for evaluations of
AFDC-FC-eligible children and children receiving AAP benefits for the
purpose of determining eligibility for regional center services,
pursuant to Section 4642. Regional centers shall assist county
welfare and probation departments in identifying appropriate
placement resources for children who are recipients of AFDC-FC and
who are eligible for regional center services.
(d) (1) For purposes of this section, children who are recipients
of AFDC-FC and regional center services who are residing with a
relative or nonrelative extended family member pursuant to paragraph
(2) of subdivision (f) of Section 319 or Section 362.7, or a facility
defined in paragraph (5) or (6) of subdivision (a) of Section 1502
of the Health and Safety Code that is not vendored by the regional
center as a residential facility, shall not be prohibited from
receiving services defined in paragraph (38) of subdivision (a) of
Section 54302 of Title 22 of the California Code of Regulations.
(2) AFDC-FC and AAP benefits shall be for care and supervision, as
defined in subdivision (b) of Section 11460, and the regional
centers shall separately purchase or secure other services contained
in the child's IFSP or IPP pursuant to Section 4646 to 4648,
inclusive, Section 4685, and Sections 95018 and 95020 of the
Government Code. Notwithstanding any other provision of law or
regulation, the receipt of AFDC-FC or AAP benefits shall not be cause
to deny any other services that a child or family for which the
child or family is otherwise eligible pursuant to this division.
(e) This section shall apply to all recipients of AFDC-FC and AAP
benefits, including those with rates established prior to the
effective date of the act that adds this subdivision, pursuant to
Sections 11464 and 16121.
(f) Regulations adopted by the department pursuant to this section
shall be adopted as emergency regulations in accordance with Chapter
3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government Code, and for the purposes of that chapter,
including Section 11349.6 of the Government Code, the adoption of
these regulations is an emergency and shall be considered by the
Office of Administrative Law as necessary for the immediate
preservation of the public peace, health, safety, and general
welfare.