AB 856

This bill allows the Department of Health Services to contract with a county or

long-term care district to operate a care management organization outside the

geographic area of that county or long-term care district and specifies a different

disposition of property and assets upon dissolution of a long-term care district. The

bill also allows a long-term care district or a governmental entity that has a contract

to operate a care management organization to create a nonstock, nonprofit

corporation or a service insurance corporation and to assign certain contracts,

permits, and certifications to the corporation with approval of DHS and the Office

of the Commissioner of Insurance.

Currently, a care management organization, under a contract with DHS,

enrolls individuals in the Family Care program and administers the Family Care

benefit, which provides financial assistance for long-term care to a frail elder or a

person with a physical or developmental disability. DHS may contract with a county,

a long-term care district, a governing body of a tribe or band or the Great Lakes

Inter-Tribal Council, a joint association of those entities, or a private organization

to be a care management organization. A county, tribe or band, or a combination of

counties or tribes or bands may create a long-term care district, which is a special

purpose district that is a local unit of government. Currently, the jurisdiction of a

long-term care district is the geographic area of the county or counties that created

the district or the geographic area of the reservation of, or land held in trust for, any

tribe or band that created the district. This bill allows DHS to contract with a county

or long-term care district to operate a care management organization outside the

geographic area of that county or long-term care district. The bill specifies that DHS

may award contracts to one or more certified entities to operate a care management

organization within a county or geographic area. If DHS awards a contract to a

long-term care district to operate a care management organization outside the

geographic area of the counties that created the long-term care district, the bill

allows any county that is newly served by that care management organization to join

the existing long-term care district under certain circumstances at the discretion of

the long-term care district's board. The bill also specifies that upon dissolution of

a long-term care district the property and the assets of the corporation transfer to

DHS instead of the entity that created the long-term care district.

The bill also allows a long-term care district or a governmental entity that has

a contract to operate a care management organization to create a nonstock, nonprofit

corporation or a service insurance corporation. Before creating the corporation that

provides the Family Care benefit, the long-term care district or governmental entity

must submit the proposed articles of incorporation to DHS for review and approval.

With approval of DHS and OCI, the long-term care district or governmental entity

may then assign to the corporation the district's assets and liabilities, a contract with

DHS to operate a care management organization, a permit issued by OCI to operate