AB 2138

AB2138:v97#DOCUMENT

Bill Start

CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

Assembly Bill

No. 2138

An act to add Sections 14045.195 and 14184.2051 to the Welfare and Institutions Code, relating to Medi-Cal.

LEGISLATIVE COUNSEL'S DIGEST

AB 2138, as amended, Krell. Medi-Cal: enhanced care management: peer support specialists.

Existing law establishes the Medi-Cal program, which is administered by the State Department of Health Care Services and under which qualified low-income individuals receive health care services. The Medi-Cal program is in part governed by, and funded pursuant to, federal Medicaid program provisions.

Existing law requires the department to implement an enhanced care management (ECM) benefit designed to address the clinical and nonclinical needs on a whole-person-care basis for certain target populations of Medi-Cal beneficiaries enrolled in Medi-Cal managed care plans. Under existing law, target populations include, among others, high utilizers with frequent hospital admissions, short-term skilled nursing facility stays, or emergency room visits, and individuals experiencing homelessness.

Existing law authorizes a county, or an agency representing a county, to develop a peer support specialist certification program, subject to departmental approval. Under existing law, these specialists are individuals, at least 18 years of age, who self-identify as having lived experience with the process of recovery from mental illness, substance use disorder, or both, as specified. Existing law requires the department to seek any federal waivers that it deems necessary to establish a demonstration or pilot project for the provision of peer support services in counties that agree to participate.

This bill would require the department to require, as a condition of providing ECM, that each ECM provider any ECM provider, whose caseload of members meets certain criteria, maintain an interdisciplinary care team that includes at least one peer support specialist or trainee, as defined, who is integrated into ECM service delivery and available to support ECM members. The bill would set forth the functions of a peer support specialist or trainee for ECM purposes.

The bill would authorize require the department to allow an ECM provider to satisfy the requirement through any combination of staffing models, as specified. The bill would require the department to ensure that Medi-Cal managed care plan contracts, policies, and guidance reflect the requirement and to establish monitoring and compliance mechanisms to ensure that ECM providers implement the requirement. The bill would require the department to recognize virtual, telephonic, and technology-enabled peer support service delivery as meeting the integration requirement. Under the bill, an ECM provider subject to these provisions would have until January 1, 2028, to achieve full compliance, as specified.

The bill would prohibit the department, a county, a Medi-Cal managed care plan, or a Medi-Cal provider, as applicable, from disqualifying a peer support specialist solely or primarily on the basis of a criminal background check, fingerprint-based background check, or similar screening that is a condition of employment, contracting, certification, credentialing, enrollment, or participation in providing peer support services.

Under the bill, this restriction would be implemented to the extent not in conflict with federal law, and the restriction would not prohibit background checks under specified circumstances. The bill would also authorize consideration of an individual’s criminal record as part of their overall fitness for the position of peer support specialist. specialist if the criminal record has a nexus to that position or its duties. The bill would condition implementation of these provisions on receipt of any necessary federal approvals and the availability of federal financial participation.

Digest Key

Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO

Bill Text

The people of the State of California do enact as follows:

SECTION 1.

(a) The Legislature finds and declares all of the following:

(1) California’s Medi-Cal population includes a significant number of individuals with complex physical health conditions, serious mental illness, substance use disorders, justice involvement, and histories of homelessness or housing instability who benefit from intensive, relationship-based care coordination and support.

(2) The enhanced care management (ECM) benefit established under the California Advancing and Innovating Medi-Cal (CalAIM) initiative is intended to provide whole-person, interdisciplinary care management that addresses clinical and nonclinical needs, reduces avoidable emergency department use and hospitalization, improves continuity of care, and supports stability in housing and community living.

(3) Peer support specialists—individuals with lived experience of mental health conditions, substance use disorders, homelessness, disability, or justice involvement who use that experience to support others—are an evidence-informed component of a high-functioning behavioral health and recovery-oriented system of care.

(4) Peer support services improve engagement, trust, and retention in care; help individuals navigate complex systems; promote hope and recovery; and support improved outcomes, including reduced crisis utilization and increased connection to treatment, housing, and community supports.

(5) Despite the demonstrated value of peers, access to peer support within ECM is inconsistent and limited by workforce shortages, contracting practices, and exclusionary screening requirements that can disqualify individuals because of prior justice involvement—precisely the lived experience that can make peer services effective for many ECM members.

(b) (1) It is the intent of the Legislature to strengthen ECM by ensuring that peer support specialists are integrated as a standard member of the ECM interdisciplinary care team, and to remove unnecessary barriers that prevent qualified peers from serving Medi-Cal members.

(2) It is further the intent of the Legislature that peer support specialist participation in ECM be expanded in a manner consistent with federal Medicaid requirements and without reducing member access to clinically appropriate screening, safety standards, or settings-based requirements that are mandated by federal law.

SEC. 2.

Section 14045.195 is added to the Welfare and Institutions Code, immediately following Section 14045.19, to read:

14045.195.

(a) Notwithstanding any other law, the department, a county, a Medi-Cal managed care plan, or a Medi-Cal provider, as applicable, shall not disqualify a peer support specialist solely or primarily on the basis of a criminal background check, fingerprint-based background check, or similar screening that is a condition of employment, contracting, certification, credentialing, enrollment, or participation in providing peer support services pursuant to this article. However, an individual’s criminal record may be considered as part of their overall fitness for the position of peer support specialist. specialist if the criminal record has a nexus to that position or its duties.

(b) (1) Subdivision (a) shall be implemented to the extent not in conflict with Section 455.434 of Title 42 of the Code of Federal Regulations or any other federal law applicable to the background checks or screenings described in subdivision (a).

(2) Subdivision (a) shall be implemented in accordance with Section 14043.38.

(c) Implementation of subdivision (a) shall not prohibit any of the following:

(1) Compliance with a background check, clearance, or disqualification standards expressly required by federal law as a condition of receiving federal financial participation for a specific service, setting, or program.

(2) Compliance with background check requirements that are specifically applicable to a distinct service setting where the peer will work, including, but not limited to, schools or facilities where state or federal law mandates those background checks for all staff.

(3) The applicable supervisory entity adopting and applying job-related, individualized safety and suitability policies that do not categorically exclude individuals based on arrest records or convictions and that consider evidence of rehabilitation, time elapsed, and relevance to the duties of peer support, consistent with state and federal nondiscrimination laws.

(d) This section shall be implemented only to the extent that the department obtains any necessary federal approvals and that federal financial participation is available and is not otherwise jeopardized. The department shall seek any necessary federal approvals to implement this section.

SEC. 3.

Section 14184.2051 is added to the Welfare and Institutions Code, immediately following Section 14184.205, to read:

14184.2051.

(a) For purposes of this section, the following definitions apply:

(1) “Enhanced care management” or “ECM” has the same meaning as set forth in Section 14184.205.

(2) “ECM provider” means an entity, provider, or organization contracted, delegated, or otherwise authorized by a Medi-Cal managed care plan to furnish ECM services.

(3) “Peer support specialist” has the same meaning as set forth in Section 14045.12.

(4) “Trainee” means an individual who is working toward peer support specialist certification under Article 1.4 (commencing with Section 14045.10) and who is scheduled to receive that certification within six months after being hired.

(4)

(5) “Interdisciplinary care team” means the set of staff, contractors, and team members responsible for delivering ECM, including care management, care coordination, member engagement, and connection to clinical and community supports.

(b) (1) The department shall require, as a condition of providing ECM under Section 14184.205, that each ECM provider any ECM provider described in paragraph (2) maintain an interdisciplinary care team that includes at least one peer support specialist or trainee who is integrated into ECM service delivery and available to support ECM members.

(2) Paragraph (1) applies to an ECM provider that serves at least 50 members, and for which individuals within the ECM “adults with serious mental illness or substance use disorder” population of focus constitute 25 percent or more of the provider’s active ECM caseload during the most recently completed calendar quarter.

(c) The peer support specialist or trainee required under subdivision (b) shall be utilized in a manner that includes, but is not limited to, one or more of the following functions, consistent with the peer’s scope of practice and training:

(1) Conducting outreach to, and engagement of, ECM members, including members who are difficult to engage or have experienced repeated crises.

(2) Supporting member self-advocacy, recovery goals, and navigation of behavioral health, substance use disorder, housing, and social services systems.

(3) Assisting with care planning, warm handoffs, transition support following inpatient or crisis episodes, and linkage to community-based supports.

(4) Providing culturally responsive, trauma-informed, relationship-based support grounded in lived experience.

(d) The department may shall allow an ECM provider to satisfy the requirement described in subdivision (b) through any combination of staffing models, including employment, contracting, shared staffing arrangements, or partnerships with community-based organizations, so long as the peer support specialist or trainee is accessible to ECM members served by the provider and is meaningfully integrated into ECM operations. The peer support specialist or trainee shall be counted toward any staff-to-patient ratio requirements.

(e) The department shall ensure that Medi-Cal managed care plan contracts, policies, and guidance reflect the requirement described in subdivision (b), and shall establish monitoring and compliance mechanisms to ensure that ECM providers implement the requirement.

(f) For purposes of satisfying the requirement under subdivision (b), a peer support specialist or trainee need not be physically colocated with a care team or member. The department shall recognize virtual, telephonic, and technology-enabled peer support service delivery as meeting the integration requirement under this section.(g) An ECM provider subject to the requirements of this section shall have until January 1, 2028, to achieve full compliance. During the 2027 calendar year, the department and Medi-Cal managed care plans shall not reduce, withhold, or recoup ECM payments to a provider solely on the basis of noncompliance with subdivision (b), if the provider submits to the department a written implementation plan no later than July 1, 2027, describing its approach to achieving compliance, including its staffing or contracting strategy and projected timeline.

(f)

(h) This section shall not be construed as limiting the department’s authority to establish clinical, quality, documentation, or supervision standards for ECM, or as limiting an ECM provider’s obligation to comply with applicable state and federal laws.