S-1364

AN ACT Relating to establishment and financing of a community-based long-term care and support services system for functionally disabled persons; adding a new chapter to Title 70 RCW; prescribing penalties; making an appropriation; providing an effective date; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. SHORT TITLE. This chapter may be known and cited as the omnibus community-based long-term care secured benefit act.

NEW SECTION. Sec. 2. PURPOSE AND INTENT. It is the purpose and intent of the legislature, through this chapter, to organize and encourage the development of community-based long-term care and support services through an integrated, comprehensive system that promotes human dignity and recognizes the individuality of all functionally disabled persons. This system shall be available, accessible, and responsive to all citizens based upon an assessment of their functional disabilities, and shall include adequate local flexibility to assure that eligible people in need of care, based on their functional disabilities, receive the least restrictive services. The legislature recognizes that families, volunteers, and community organizations are absolutely essential for delivery of effective and efficient community-based long-term care and support services and it is a purpose of this chapter to support and strengthen that private and public service infrastructure.

It is further the intent of the legislature to provide continuity of care and integration of services.

NEW SECTION. Sec. 3. DEFINITIONS. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Administrative entity" means an agency of state or local government or a private nonprofit organization that has entered into an agreement with the department to administer any part of the program.

(2) "Committee" means the community-based long-term care policy advisory committee established pursuant to section 6 of this act.

(3) "Community-based long-term care and support services" means services and support provided to program beneficiaries in accordance with section 9 of this act.

(4) "Department" means the department of community development.

(5) "Federal poverty level" means the annual poverty guidelines determined annually by the United States department of health and human services, or its successor agency.

(6) "Functionally disabled person" means a person who, because of a recognized chronic physical or mental condition or disease: (a) Needs care, including medical care, support, supervision, or monitoring to perform activities of daily living or instrumental activities of daily living; or (b) needs support to ameliorate or compensate for the effect of the chronic physical or mental condition or disease.

(7) "Habilitation service" means services to assist persons in acquiring and maintaining life skills and to raise, maintain, or support their levels of physical, mental, social, and vocational functioning. "Habilitation services" shall not include major rehabilitative services to assist persons in regaining previously existing bodily functions and life skills.

(8) "Program" means the community-based long-term care program established by this chapter.

(9) "Program beneficiary" means a person who has been determined to be functionally disabled and eligible to receive services through the program.

PART I

ADMINISTRATION OF THE COMMUNITY-BASED

LONG-TERM CARE SECURED BENEFIT PROGRAM

NEW SECTION. Sec. 4. INTENT REGARDING PROGRAM ADMINISTRATION. It is the intent of the legislature that administration of the program include active participation by program beneficiaries, their families, and communities in public discussions, service planning, decision making, and service delivery. Administrative entities shall encourage creativity and innovation in the development and implementation of services. Information systems shall be developed to assess program outcomes and to assure state-wide adherence to baseline levels of service availability and quality. A simplified, independent inspection, monitoring and correction function shall be established within the system.

NEW SECTION. Sec. 5. POWERS OF DEPARTMENT. (1) The department shall have the following powers and duties:

(a) To oversee, encourage, and support the development of a community-based long-term care and support system that provides coordinated care and support for functionally disabled persons, strengthening existing community, family, and volunteer resources to the greatest extent possible, in which functionally disabled persons and resources are directed toward the least restrictive and least costly service appropriate for each such person;

(b) To manage the current expense account and reserve account of the secured benefit fund established by section 19 of this act;

(c) To develop and adopt rules establishing minimum standards to ensure the health, safety, and protection of beneficiaries, and to develop uniform standards for assessments of the functionally disabled, for the delivery of program services, administer program activities, and to determine the scope of community-based long-term care and support services covered by the program in accordance with section 9 of this act.

(i) In determining the scope of services, the department shall maintain the financial integrity of the secured benefit fund;

(ii) The department shall define the scope of transportation services that can be funded by the program in accordance with section 9 of this act;

(d) To administer and adjust the sliding fee scale as necessary, in accordance with section 10 of this act;

(e) To develop payment and cost control mechanisms for community-based long-term care and support services ensuring compliance with federal requirements;

(f) To design and administer a long-term care information system in accordance with section 15 of this act;

(g) To encourage community development of mechanisms to assure coordination with the acute health care services system, the vocational rehabilitation services system, and the long-term care worker education and training system; and

(h) To delegate its authority, when deemed appropriate by the department, to other public or private entities.

(2) The department may contract with third parties for services necessary to carry out its responsibilities and duties to the extent not prohibited by RCW 41.06.380.

NEW SECTION. Sec. 6. ESTABLISHMENT OF POLICY ADVISORY COMMITTEE. (1) The community-based long-term care policy advisory committee is hereby established. The committee shall be composed of thirteen members appointed by the department. At least seven of the members shall be functionally disabled persons or their advocates, who shall not be paid long-term care services providers. The remaining members of the committee shall consist of two members representing the public, two members representing the nursing facility operators, and two members representing other long-term care providers.

(2) The committee shall:

(a) Advise the department regarding planning and administration of the program; and

(b) Review and comment upon department programs, state policies, programs, and actions that affect program beneficiaries, with the intent of assuring maximum coordination with health care services, long-term care and support services, and local long-term care organizations that provide community-based services focusing on program beneficiaries' needs.

(3) The committee shall meet at least quarterly. Committee members shall be reimbursed for travel expenses pursuant to RCW 43.03.050 and 43.03.060.

NEW SECTION. Sec. 7. QUALITY ASSURANCE. (1) The department is responsible for quality assurance activities relating to licensing, monitoring, and enforcement of performance standards applicable to administrative entities and community-based long-term care and support service providers. In its quality assurance activities, the department shall emphasize review of service outcomes, rather than the manner in which services are administered.

(2) Quality assurance activities shall include but not be limited to:

(a) Establishment of licensure and certification requirements for administrative entities, community-based long-term care and support service providers, and their employees, to the extent such requirements are not otherwise required by law;

(b) Enforcement of all licensure and certification requirements for administrative entities, community-based long-term care and support service providers, and their employees, including license and certification issuance, renewal, denial, or revocation;

(c) Monitoring and investigation of performance by administrative entities and community-based long-term care and support service providers, and their employees, including the establishment of mechanisms to receive and respond to reports of abuse, neglect, malpractice, misfeasance, and contractual violations by such entities and providers;

(d) Imposition of sanctions against administrative entities, community-based long-term care and support service providers, and their employees, for abuse, neglect, malpractice, misfeasance, and contractual violations, which shall include withholding or requiring the withholding of payment, terminating or requiring the termination of contracts, injunctive remedies, civil penalties, receivership, and referral for prosecution; and

(e) Retrospective monitoring of data gathered through the information system established by section 15 of this act.

(3) The department shall provide for an independent office of the inspector general to assist in carrying out the quality assurance powers and duties established in this section, which office shall report directly to the department and which shall annually report to the legislature on the quality of community-based long-term care and support services provided to functionally disabled persons.

(4) By petition to the department, a program beneficiary may initiate, or intervene in, any proceeding in which the department is taking an enforcement action against an administrative entity or community-based long-term care provider serving the program beneficiary.

PART II

COMMUNITY-BASED LONG TERM CARE SERVICES

NEW SECTION. Sec. 8. INTENT REGARDING SERVICES. It is the intent of sections 9 through 11 of this act relating to community-based long-term care and support services that such services be defined by local communities as those noninstitutional services that are primarily habilitative which would allow program beneficiaries to live and otherwise function in their community as independently as practicable. Although these services do not include nursing homes, state institutions, or health care facilities, it is necessary that these functions be coordinated with the community-based long-term care system. It is recognized that uniform systems of assessment and case management are essential for monitoring equity and quality in service delivery, measuring outcomes, and assuring the most effective use of public and private expenditures. It is recognized that availability of services does not guarantee their use, and that aggressive targeting and outreach by local communities, and culturally and linguistically accessible and appropriate services, are necessary to assure that services are available to the most dispossessed in our communities.

NEW SECTION. Sec. 9. COMMUNITY-BASED LONG-TERM CARE AND SUPPORT SERVICES. (1) Community-based long-term care and support services shall include at least the following services:

(a) Public education;

(b) Telephone information and assistance, including screening and possible referral for case management assessment;

(d) Case management, which shall include:

(i) A multidimensional assessment of the functionally disabled person's health and long-term care needs. No cost-sharing shall be imposed for this modality;

(iii) Reassessment and service termination;

(e) Personal and household assistance services to assist individuals with activities of daily living and instrumental activities of daily living;

(f) Respite care and family support services necessary to maintain the program beneficiary in his or her family home;

(g) Nursing services;

(h) Day care and day health care for functionally disabled persons;

(i) Mental health day treatment and other mental health counseling;

(j) Habilitation services; and

(k) Transportation services, to the extent that the administrative entity can demonstrate positive planning by the community through the use of a local option tax or other method to provide paratransit or specialized transportation services to program beneficiaries.

(2) Each functionally disabled person's participation in a functional assessment performed by an entity designated by the department pursuant to section 5 of this act shall be a precondition to receipt of all community-based long-term care services.

(3) Services performed by the following institutions shall not be considered to be community-based services subject to the requirements of this chapter:

(a) Nursing homes licensed pursuant to chapter 18.51 RCW;

(b) State institutions for developmentally disabled persons, defined as residential habilitation centers in chapter 71A.20 RCW; and

(c) State institutions for mentally ill persons, including but not limited to Eastern State Hospital and Western State Hospital.

(4) In determining whether services not explicitly included pursuant to subsection (1) of this section or excluded pursuant to subsection (3) of this section can be offered through the program, the department shall consider the following criteria:

(a) Protection of the financial integrity of the community-based services program;

(b) The extent to which the service is consistent with the intent and purposes of this chapter;

(d) The needs of individual local communities;

(e) The effectiveness and efficiency of the service; and

(f) The extent of local community and volunteer participation in providing the service.

NEW SECTION. Sec. 10. PROGRAM BENEFICIARY COST-SHARING. (1) The department shall establish a sliding fee scale to determine a program beneficiary's contribution to the cost of community-based long-term care and support services provided to him or her through the program. The sliding fee scale shall be designed to generate a minimum of twenty percent of operating costs of the new system.

(2) The sliding fee scale shall:

(a) Base the level of a program beneficiary's contribution on that individual's gross household income, giving appropriate consideration to family size. In determining gross household income, the income of an applicant's spouse shall be considered available to the applicant, and the income of a minor applicant's parents shall be considered available to that minor. The department shall define "income" and other relevant criteria by rule;

(b) Provide that for program beneficiaries with gross household income below one hundred fifty percent of the federal poverty level, cost-sharing shall not have the effect of discouraging appropriate use of necessary community-based long-term care and support services;

(3) To affect community-based long-term care and support service utilization, the department may establish copayments or deductibles which:

(a) May be imposed in lieu of the sliding fee scale for program beneficiaries requiring small amounts of community-based long-term care and support services; and

(b) Shall not have the effect of discouraging appropriate use of necessary community-based long-term care and support services for program beneficiaries with gross household incomes below one hundred fifty percent of the federal poverty level.

NEW SECTION. Sec. 11. RIGHT TO REFUSE SERVICES. Nothing contained in this chapter shall be construed to require a program beneficiary to accept services, except to the extent provided otherwise by chapters 71.05, 11.88, and 11.92 RCW.

PART III

IMPLEMENTING THE NEW COMMUNITY-BASED

LONG-TERM CARE SYSTEM

NEW SECTION. Sec. 12. INTENT RELATING TO IMPLEMENTATION. It is the intent of the legislature that state-wide community-based long-term care and support services be modeled through locally developed and administered projects that will test various administrative structures. The director may enter into agreements with local governments, private agencies, or other public groups to develop additional community-based long-term care and support services to be provided through medicaid and other expansions using revenue from the secured benefit fund to serve unmet needs.

NEW SECTION. Sec. 13. ADMINISTRATIVE MODEL PROJECTS. (1) The director shall provide resources to those entities referenced in section 12 of this act for community-based long-term care pilot projects.

(2) Agreements to operate pilot projects shall be competitively bid and shall satisfy the following criteria:

(a) Build upon support available to each program beneficiary from the individual's family, community, local business, and local community-based long-term care providers;

(b) Existing local advisory councils, such as councils on aging, developmental disabilities, and mental health established under state or federal law, and multicultural and multi-ethnic groups will be involved in the proposed long-term care delivery project;

(c) Services to minimize the effects of degenerative and debilitating conditions that result in a loss of independence will be offered. Such a plan might include a mechanism to support people who are at risk of rapid deterioration without support;

(d) Encourage local community development of mechanisms that will be used to coordinate services with the acute health care and vocational rehabilitation systems;

(e) Transportation needs will be assessed and addressed;

(f) Identify mechanisms that will be used to control nursing costs;

(g) Provide case management services that include:

(i) A multidimensional assessment of the functionally disabled person's health and long-term care needs. No cost-sharing shall be imposed for this modality;

(ii) Development of a comprehensive care plan negotiated by the program beneficiary, the beneficiary's family or guardian, and the local long-term care organization providing community-based services, which meets minimum standards established by the department, and which is subject to an appeal mechanism that provides an opportunity for informal review prior to a fair hearing;

(iii) Initiation, coordination, and monitoring of all long-term care services needed by a program beneficiary, including those services not funded by the program;

(iv) Involvement of each program beneficiary's family and other support systems; and

(v) Reassessment and service termination;

(h) Include mechanisms to ensure access to culturally and linguistically appropriate services by minority and limited English speaking populations.

(3) The department shall, to the greatest extent possible, contract for a diversity of case management models. At least one of the models shall utilize a case management model in which the case manager authorizes and manages services within budgeted funds.

(4) Contracts with administrative model project entities shall include remedies for failure to comply with the terms of the contract, including intermediate remedies in addition to termination of a contract.

(5) There shall be four pilot administrative model projects, located as follows:

(a) Two projects in eastern Washington, one to be located in an urban setting and one to be located in a rural setting;

(b) Two projects in Western Washington, one to be located in an urban setting and one to be located in a rural setting.

NEW SECTION. Sec. 14. EVALUATION OF ADMINISTRATIVE MODEL PROJECTS. The department shall develop criteria to evaluate the success and failure of the administrative model projects established pursuant to section 13 of this act in meeting the intent and purposes of this chapter. The department shall contract with an independent entity to evaluate:

(1) The administrative model projects using the criteria developed pursuant to this section; and

(2) The actions taken by the department to implement this chapter giving consideration to this chapter's intent and purposes.

A report detailing the results of the evaluation shall be submitted to the governor and appropriate committees of the legislature no later than three years following initiation of the administrative model projects.

NEW SECTION. Sec. 15. INFORMATION SYSTEM. The department shall design and administer a long-term care information system. In designing the information system, the department shall pursue the following objectives:

(1) Use of a single common identifier for each functionally disabled person using long-term care services;

(2) Ability to track each functionally disabled person's use of long-term care services;

(3) Protection of confidentiality for functionally disabled persons using long-term care services; and

(4) Access to nonconfidential information relating to available long-term care services, training information for caregivers, and service utilization and cost data for planners and policymakers.

NEW SECTION. Sec. 16. ADMINISTRATION OF LONG-TERM CARE SERVICES PENDING STATE-WIDE IMPLEMENTATION OF PROGRAM. Pending merger of current categorical long-term care systems into the program, other than in the model administrative sites, current long-term care services administration shall continue. During this period, subject to department approval, agencies administering community-based long-term care and support services may make administrative changes consistent with the intent and purposes of this chapter and as otherwise authorized by law.

PART IV

FINANCING COMMUNITY-BASED

LONG-TERM CARE SERVICES

NEW SECTION. Sec. 17. INTENT RELATING TO FINANCING. Recognizing that financial stability is essential to success of a comprehensive long-term care system and that current and future demands are exceeding available financial resources, a dedicated fund comprised of state general funds, matching federal funds, public insurance funds, and sliding fee contributions by program beneficiaries shall be established. The legislature recognizes that development and implementation of the program will involve significant cooperation and partnership between Washington state and the federal government. It is the intent of the legislature that a minimum of fifty percent of annual revenues generated by public insurance be held in an ongoing trust account that will accrue principal and interest until at least the year 2010 and then be expended only for services eligible under this chapter.

NEW SECTION. Sec. 18. FEDERAL/STATE RELATIONSHIP. The department shall identify federal requirements and ensure that those requirements are met so as to allow federal funds currently used for community-based long-term care and support services to be deposited into the secured benefit fund and expended as provided in this chapter. If, during implementation of services pursuant to section 13 of this act, federal medicaid waivers are necessary, the department shall seek such waivers.

NEW SECTION. Sec. 19. FINANCING. (1) The secured benefit fund is created in the state treasury. All receipts from sources specified in this section shall be deposited in the fund. Moneys in the fund may be spent only after appropriation and may be used only for carrying out the purposes of this chapter.

(2) The secured benefit fund shall consist of:

(a) The insurance contributions specified in this section for any calendar year that begins on or after January 1, 1992, and payable by each employer as defined in RCW 50.04.080, and each individual registered with the department of revenue under Title 82 RCW;

(b) Legislative appropriations for general fund-state spending for community-based long-term care and support services;

(c) Federal funds received by the state as payment for community-based long-term care and support services, including but not limited to the medicare program, Title XVIII of the federal social security act, and the medicaid program, Title XIX of the federal social security act; and

(d) Program beneficiary cost-sharing as provided in section 10 of this act.

(3) Moneys in the secured benefit fund shall constitute the entire budget for program services. The state investment board shall invest the funds pursuant to chapter 43.33A RCW.

(4)(a) Insurance contributions under subsection (2)(a) of this section shall become due and be paid under rules adopted by the commissioner of the employment security department. Contributions shall be collected on a semi-annual basis, with the first period consisting of the six calendar months ending June 30, and the second period consisting of the six calendar months ending December 31, of each calendar year. Up to one-half of the contribution may be deducted from the remuneration of individuals in the employ of the employer. Any deduction greater than one-half from individuals is in violation of this section and is unlawful, and is subject to penalty under Title 50 RCW for an unlawful deduction.

(b) For employers described in RCW 50.44.010 and 50.44.030 who have properly elected to make payments in lieu of contributions, employers who are required to make payments in lieu of contributions, and employers paying contributions under RCW 50.44.035, the contributions shall be paid according to rules adopted by the commissioner.

(c) The insurance contribution of individuals only registered with the department of revenue under Title 82 RCW shall be determined according to rules adopted by the commissioner of the employment security department. The rules shall include provisions that: (i) Require contributions on remuneration that is comparable to the wages subject to contributions under subsection (5) of this section; and (ii) if the individual's remuneration is subject to contribution under more than one subsection of this section, the total remuneration subject to contribution shall not exceed forty thousand dollars annually, as specified in subsection (5) of this section.

(5)(a) The amount of wages subject to insurance contributions under subsection (2)(a) of this section shall be forty thousand dollars annually, except that no contribution shall be paid on wages of any individual earning wages of less than one thousand five hundred dollars per calendar quarter. The contribution rate applicable to wages paid shall be 0.55 percent.

(b) "Wages" under this subsection shall include all remuneration for contribution purposes as defined under RCW 50.04.320.

(6) In the payment of any insurance contribution under this section, a fractional part of a cent shall be disregarded unless it amounts to one-half cent or more, in which case it shall be increased to one cent.

(7) Late reports or contributions, and penalties and interest shall be determined and administered as provided under Title 50 RCW. In administering this section, the commissioner of the employment security department shall have the same authority as is provided for administering and enforcing the collection of contributions under Title 50 RCW.

NEW SECTION. Sec. 20. PRIVATE LONG-TERM CARE INSURANCE. The private long-term care insurance commission is hereby established. The commission shall be composed of seven members who shall be appointed by the insurance commissioner. Commission members shall be reimbursed for travel expenses pursuant to RCW 43.03.050 and 43.03.060.

(2) The commission shall review and make recommendations regarding the role of long-term care insurance in the new system. The commission shall report its recommendations to the department, the insurance commissioner, and appropriate committees of the legislature on or before December 1, 1992.

NEW SECTION. Sec. 21. SEVERABILITY. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 22. EFFECTIVE DATE. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect July 1, 1991.

NEW SECTION. Sec. 23. CAPTIONS NOT LAW. Part and section headings as used in this chapter do not constitute any part of the law.

NEW SECTION. Sec. 24. Sections 1 through 23 of this act shall constitute a new chapter in Title 70 RCW.

NEW SECTION. Sec. 25. The sum of one million dollars, or as much thereof as may be necessary, is appropriated for the biennium ending June 30, 1993, from the general fund to the department of community development for the purposes of section 13 of this act.