Summary of the California Enacted 2021-22 Budget and Home- and Community-Based Services Spending Plan: Impact on Older Adults, People with Disabilities, and Their Caregivers

Overview

The 2021-22 budget includes significant investments to assist low- and middle-income Californians, strengthen the state’s infrastructure, and implement the Master Plan for Aging, among other priorities.¹ As outlined below, the budget also includes spending authority for the state’s proposed $4.6 billion Home- and Community-Based Services Spending Plan, in accordance with the federal American Rescue Plan Act of 2021 (ARPA).² Overall, the budget reflects total General Fund (GF) resources of $203.6 billion and anticipated expenditures of $196.4 billion, with the remainder held in reserves.¹

A New Era for Aging in California

This past year, California’s low-income older adults, people with disabilities and caregivers, as well as Black, Latinx, Indigenous, Asian and Pacific Islander, and LGBTQ populations have experienced tremendous hardships. Today’s challenges magnify underlying system issues that for years have impacted the aging population, including workforce shortages, lack of access to housing and services, and fragmented health care and long-term services and supports (LTSS) systems.

However, in this past year the state has shown that bold leadership, coupled with public/private partnership, can change this narrative. Grounded in principles of equity and inclusion, the Master Plan for Aging (Master Plan) is paving the way for broad-based system change across health care, LTSS, housing, and the workforce. The 2021-22 budget reflects unprecedented investments in the Master Plan. While there is still much work to do, the budget offers a very solid start to its 10-year implementation.

California’s 2021-22 Budget: Impact on Older Adults, People with Disabilities, and Family Caregivers

The enacted 2021-22 budget includes a range of new investments in line with the Master Plan, as outlined below. Several of these investments are supported through one-time funds and continued COVID-19 stimulus funding, all of which advance Master Plan implementation.¹

The enacted budget includes significant health care investments that expand access to Medi-Cal and telehealth, and implement California Advancing and Innovating Medi-Cal (CalAIM) and other provisions highlighted in Table 2 below.

The enacted budget includes investments to enhance LTSS system capacity, as reflected by the items outlined in Table 3 below.

The enacted budget includes investments to support consumers in accessing the information and support needed to navigate the health care and LTSS systems, as outlined in the Table 4.

Additionally, the budget includes $24.5 million GF for a comprehensive package of services to address Alzheimer’s disease, as reflected in Table 5.¹ Funding for the Alzheimer’s disease workforce development is included as part of the workforce development funding in Table 2. Additionally, funding for Alzheimer’s Day Care and Resource Centers is outlined in the Home- and Community- Based Services (HCBS) Spending Plan in Table 9.

The enacted budget enhances access to affordable housing and services for those experiencing homelessness, with new investments supported by a combination of federal and state dollars. Table 6 reflects the housing items that could directly impact older adults and people with disabilities.

The enacted budget invests in economic security and food access initiatives to assist California’s low-income older adults, people with disabilities, and others in obtaining income support and food assistance, as outlined in Table 7.

The enacted budget also focuses on equity, as well as efforts to inform responses for future emergencies and improve language access across the CHHS department and programs that serve older adults and people with disabilities, as reflected in Table 8.

California’s Proposed Home- and Community-Based Services Spending Plan

On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 (ARPA) to assist state and local governments with fiscal recovery from the COVID-19 pandemic. Among other provisions, ARPA includes a temporary 10 percent increase to states’ Federal Medical Assistance Percentage (FMAP) to provide additional support for Medicaid HCBS.²

The enhanced federal funding provides an opportunity to make meaningful investments in HCBS programs serving older adults, people with disabilities, and caregivers—as well as people with developmental disabilities, people with behavioral health needs, and those experiencing homelessness.

The 2021-22 Budget and the HCBS Spending Plan

On July 12, California submitted its proposed $4.6 billion Home and Community-Based Services Spending Plan (Spending Plan) to the federal government, which is currently under review by its Centers for Medicare & Medicaid Services (CMS). The Spending Plan is a combination of the $3 billion in enhanced federal match provided by ARPA through 2023-24, and $1.6 billion standard GF and FMAP for Medi- Cal covered services.⁸

The enacted budget establishes a Home- and Community-Based Services American Rescue Plan Fund (HCBS ARPA Fund), which will pay for Spending Plan items. The HCBS ARPA Fund includes the approximately $3 billion enhanced federal match provided by ARPA, allocated to the following:

• $1.5 billion to reduce and replace the General Fund cost of HCBS proposals included in the budget.
• $1.5 billion to fund HCBS augmentations identified by the Secretary of Health and Human Services Agency and the Department of Finance, in addition to proposals already included in the budget.⁹

California’s proposed Spending Plan includes investments seeking to build capacity and transform the system through workforce development, HCBS navigation, transition, enhanced HCBS capacity, and HCBS infrastructure and support. The following proposed investments include key areas that impact older adults, people with disabilities, and family caregivers. These are, again, in alignment with the Master Plan.^8†

A Closing Note on Advancing the Master Plan for Aging: Four Recommendations for Gubernatorial and Legislative Leadership and Stakeholder Engagement

The historic investments included in the 2021-22 budget and the proposed HCBS Spending Plan offer great potential to advance system transformation with a focus on equity. The Master Plan provides a structure to prioritize and guide use of these funds to be the most impactful and equitable. However, this will require strong and sustained state and legislative leadership as well as stakeholder engagement.

The following recommendations speak to the important role the California Legislature, the governor, and stakeholders play in advancing Master Plan implementation with a focus on equity in the years ahead.

1. Senior Advisor for Aging, Disability and Alzheimer’s: At the gubernatorial level, there is need for coordinated, engaged leadership addressing aging issues across multiple state agencies. The enacted budget includes resources for a Senior Advisor for Aging, Disability and Alzheimer’s. While this is a very small piece of the state’s $204 billion budget, it holds the potential to create long-term change for California’s older adults, people with disabilities, and family caregivers. Filling this position in the near future is imperative as it will play a key role in advancing Master Plan efforts.
2. Legislative Oversight and Leadership: The Legislature plays an important role in overseeing key policy initiatives of the Master Plan, and ensuring the state is held accountable for implementation. To this end, legislative oversight hearings on both the Master Plan and the HCBS Spending Plan are critical to identifying issues and ensuring successful implementation. Additionally, to build legislative leadership, the Legislature could establish an Aging and Disability Caucus with legislators committed to advancing system transformation.
3. Stakeholder Engagement and Coordinated Advocacy: To ensure an equitable approach to Master Plan implementation, it is important that the state hear from diverse voices representing older adults, people with disabilities, and family caregivers. Stakeholders could benefit from developing a coordinated voice through which to advocate for Master Plan priorities. Additionally, with multiple stakeholder groups serving across departments§, there is potential for overlapping/duplicative discussions and confusion about areas of responsibility. The Disability and Aging Community Living Advisory Committee (DACLAC) focuses on the tenets of community living, and includes representation across aging, disability, developmental disability, and behavioral health populations. As such, DACLAC is primed to serve as the leading stakeholder group providing input to help guide the state and Legislature with HCBS Spending Plan implementation.
4. Local Planning: Implementation of the Master Plan relies on strong local engagement and The California Advocacy Network is a statewide collaboration involving nearly 1,000 organizations including CBOs, aging and disability service and advocacy groups, and consumer and provider organizations. These local partners play a critical role in working with public and private partners to address local needs. These efforts should be leveraged to build out local-level plans, particularly in under-resourced and underserved communities, using the Master Plan’s Local Playbook as a template.

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