(a) The Legislature finds and declares all of the following: (1) The current service provider rate structure in the system administered by the State Department of Developmental Services lacks transparency, remains complex, is not tied to person-centered outcomes, and varies across providers who provide the same service in the same region. (2) In 2016, the Legislature funded a rate study to address the sustainability, quality, and transparency of community-based services for individuals with developmental disabilities. (3) The department, with the help of a consultant, completed the rate study in 2019 and subsequently submitted the studyâs findings and recommendations to the Legislature. Among other things, the study recommended all of the following: (A) Within each service category, rate models that include components that may be regularly updated. (B) Regional differentials to account for regional variance in the cost of living and doing business. (C) Enhanced rates for services delivered in other languages, including American Sign Language. (D) An optional add-on for direct service professional levels and wage differentials based on training and demonstrated competency. (E) The consolidation of certain service codes. (4) The rate studyâs fiscal impact analysis indicated that full implementation of these rate models would cost an additional one billion one hundred million dollars ($1,100,000,000) from the General Fund, or one billion eight hundred million dollars ($1,800,000,000) of total funds, in the 2019â20 fiscal year. (5) The recommendations from the rate study and the associated rate models have not been implemented, even as rate study findings informed supplemental rate increases for many service categories in the 2019â20 fiscal year and three additional service categories in the 2020â21 fiscal year. (6) For Medi-Cal eligible consumers, the department receives federal Medicaid reimbursements to support home- and community-based services provided to those consumers. (7) Direct service professionals employed by service providers are critical to the quality and provision of services and supports to individuals with intellectual and developmental disabilities. (8) A prevailing need and challenge within the developmental services system is moving from a compliance-based system to an outcomes-based system. Outcome measures must reinforce the systemâs core values of meeting individual needs based on person-centered planning. The implementation of rates, pursuant to this section, should support this person-centered transformation through consideration of incentive payments, alternative payment models, alternative service delivery, lessons learned from the COVID-19 pandemic period, person-centered and culturally and linguistically sensitive and competent approaches, training of direct service professionals, compliance with the federal home- and community-based services rule set to take effect on March 17, 2023, and methods for assessing and reporting outcomes. (9) To improve consumer outcomes and experiences and measure overall system performance, four goals should guide rate reform: (A) Consumer experience. (B) Equity. (C) Quality and outcomes. (D) System efficiencies. (b) Therefore, it is the intent of the Legislature to phase in funding and policies beginning in the 2021â22 fiscal year to implement rate reform, which shall include a quality incentive program, create an enhanced person-centered, outcomes-based system, and complete this transformation by July 1, 2025. (c) (1) (A) Commencing April 1, 2022, the department shall implement a rate increase for service providers that equals one-quarter of the difference between current rates and the fully funded rate model for each provider. (B) Commencing January 1, 2023, and continuing through December 31, 2024, the department shall adjust rates to equal one-half of the difference between rates in effect March 31, 2022, and the fully funded rate model for each provid
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