Introduction

HIV/AIDS in California: Epidemiologic Overview

HIV Care and Treatment Services

Medi-Cal

Expanding Access to Health Care

Managed Care Reform

Housing for People Living with HIV/AIDS

HIV Testing and Reporting

HIV Prevention Efforts

Work Entry and Re-Entry Issues for People Living with HIV/AIDS

Medicinal Marijuana

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Toward 2000: An HIV/AIDS
Policy Agenda for California

HIV Care and Treatment Services

The State of California funds many services and programs that are critical for people living with HIV/AIDS and those at risk for HIV infection. Taken together, these various programs are not only important to the health and well being of people living with HIV but also help to protect the health of all Californians. During Fiscal Year (FY) 1998-1999, California's budget includes over $135 million in state general funds for a variety of HIV/AIDS-specific programs (including care and treatment programs, prevention education efforts, and HIV antibody testing). Including state, federal, and some other limited sources, the State of California will administer a total of approximately $280 million for HIV/AIDS programs in FY 1998-1999 (this does not include federal dollars that are channeled directly to localities or community-based organizations).

Funding for HIV Care and Treatment Programs

A large portion of this overall funding for HIV/AIDS is used to support essential care and treatment services. Among these services is the AIDS Drug Assistance Program (ADAP), which makes pharmaceutical treatments accessible to those who otherwise could not afford them, early intervention sites, which provide critical health services for those newly diagnosed with HIV, and other important services that improve the health and quality of life for people living with HIV disease.

Importance of the Federal Ryan White Comprehensive AIDS Resources Emergency (CARE) Act

Most of the funding for HIV care-related services in California comes from federal sources. Other than Medicaid (which is described in detail in sections below), the Ryan White CARE Act is the largest source of federal funding for care and treatment services for people with HIV/AIDS in the nation. In FY 1999, California will receive over $210 million from all titles (i.e., the different sections) of the CARE Act. Specifically:

• Nine Title I epicenters in California will receive almost $102 million in CARE Act funding. Over 90% of reported AIDS cases in California are from these nine areas.
  
  
• Title II, which funds ADAP, thirty-four CARE consortia (which provide health care and support services to individuals residing in a local geographic area) and other state care programs will receive $95.9 million.
  
  
• Titles III and IV, which provide direct funding to community-based health centers for early intervention services and services for women, infants and youth, respectively, will provide over $9.3 million to programs located in California.
  
  
• Finally, through Title V, California will receive over $4.3 million for HIV-related dental and orthodontic care and training for health care professionals.

Federal legislation authorizing the Ryan White CARE Act expires on September 30, 2000. Given the importance of the Act for the state, state and local policy makers and community groups in California should play a leading role in the reauthorization process. In addition, California should continue to advocate annually for CARE funding increases during the federal appropriations process.

The AIDS Drug Assistance Program (ADAP)

Over the last several years, pharmaceutical therapies have become increasingly important in the treatment of HIV disease. One of the most critical programs for improving access to these drugs is ADAP. Funded through both state and federal sources, California's ADAP provides HIV-related prescription drugs to low-and moderate-income individuals who are not eligible for Medi-Cal and also lack adequate private health insurance. ADAP has become particularly important in recent years because the combination therapies for the treatment of HIV are extremely expensive, costing between $10,000 and $15,000 per person per year.

However, as the demand for these expensive treatments has increased, the burden on ADAP has also grown dramatically. Fortunately, former Governor Pete Wilson and the Legislature consistently recognized the importance of ADAP and worked with advocates to ensure appropriate state contributions to augment federal funds. Between FY 1993-1994 and FY 1998-1999, the total ADAP budget (from all sources) grew from $15.3 million to $122 million, with the state portion growing from $9.1 million to $51.6 million during the same time period (figure 1).

Figure 1: California ADAP Funding, FY 1993/1994 to FY 1998/1999

Without such funding increases, California would most likely have been forced to impose harsh restrictions--such as limiting enrollment or reducing the number of drugs covered--that would have been extremely detrimental to the health of many Californians living with HIV. Fortunately, this has not been the case. Total resources for the 1998 program were adequate to provide critical therapies to almost 20,000 enrollees throughout the state.

Ensuring the Availability of New and Existing Drug Therapies Through ADAP

Adequate funding is also critical to ensure that the ADAP formulary (the list of drugs covered by the program) is as comprehensive as possible. Pharmaceutical therapies for HIV disease are in an age of rapid innovation. With each new generation of drugs, important advances are made in therapeutic outcomes, ease of adherence to recommended dosing schedules, and reduction in unintended side effects.

For these reasons, it is important that newly approved HIV therapies be made available through the ADAP program as quickly as possible. In general, California has been committed to this goal and all 14 HIV antiretrovirals (i.e., drugs that directly suppress the activity and/or reproduction of HIV) approved by the Federal Food and Drug Administration are now included in California's ADAP formulary.

Ensuring the rapid addition of newly approved HIV drugs, while maintaining access to existing ones, is essential. In addition to drugs that work to directly alter the effects of HIV on the body, other treatments that address conditions or symptoms associated with HIV disease are crucial to the health status of Californians being treated for HIV/AIDS. In FY 1998-1999, policy makers in California approved ADAP funding levels necessary to significantly expand the state's ADAP formulary to include fifty such drugs. Continuing to update the ADAP formulary--and ensuring funding to do so--will be critical in the years ahead.

ADAP Centralization

In 1997 and 1998, in order to reduce costs and maximize the use of ADAP dollars, the state centralized the administration of the ADAP program. Previously, the program had been administered by forty-eight local health jurisdictions. It is now administered statewide by an independent entity, a pharmaceutical benefits management (PBM) company named Ramsell-PMD Corporations.

This change has been extremely effective and has helped save millions of dollars by allowing the state to purchase drugs in large quantities at lower prices. It has also greatly expanded consumer access to ADAP pharmacies throughout the state. FY 1999-2000 ADAP Budget: Including state and federal sources, as well as pharmaceutical rebates, the Governor's proposed FY 1999-2000 budget increases ADAP by $14.6 million, from $121.9 million to $136.6 million (Table 1).

This is good news and should ensure that California's ADAP is able to continue to serve all those who are eligible for the program. However, the budget actually includes a $4.1 million reduction in state contributions to ADAP. This is largely because of higher-than-expected federal contributions and a general slowing in state ADAP expenditures.

Table 1: California ADAP Funding: FY 1998-1999 and Proposed FY 1999-2000

Funding for Non-ADAP Care and Treatment Services

If state funds for ADAP are ultimately reduced (as proposed in the Governor's 1999-2000 budget), it is critical that the state reallocate these dollars to other HIV/AIDS programs, including those that provide HIV care and support services. Unfortunately, Governor Davis' proposed budget does not include such a reallocation of funds. Instead, the funds shifted out of ADAP are removed from the HIV/AIDS budget completely, effectively reducing state funding for HIV/AIDS-specific care and treatment programs by $4.1 million between FY 1998-1999 and FY 1999-2000.

Table 2: Proposed State General Funds for HIV/AIDS Care and Treatment Programs, FY 1995-1996 through FY 1999-2000 (in millions)*

*The programs included in this table are described in detail below except for Home and Community-Based Care, which provides nurse case management and home-based care to individuals living with AIDS and symptomatic HIV.
Source: California Department of Finance

This situation is problematic for several reasons. First and foremost, critical non-ADAP HIV care and support programs have not received notable increases in several years despite the fact that the number of people living with AIDS has grown by nearly 200% since 1993. Funding for many HIV programs has not even maintained pace with inflation, let alone growing caseloads. Second, this reduction in state funds for HIV care programs is dangerous because it could put millions of dollars in federal funds at risk. Title II of the Ryan White CARE Act contains a provision requiring states to invest resources at levels equal to those committed to HIV/AIDS in previous years. As a result, if state spending for HIV/AIDS in FY 1999-2000 is less than it is during the current year, the state is in jeopardy of losing nearly $96 million in State Title II funds.

The Legislature and Administration should ensure that HIV-related programs are funded at a level that guarantees that federal funds are not in danger of being eliminated. Some of the HIV care and treatment programs most in need of additional funding include:

• Early Intervention Programs (EIPs): EIPs offer health services to those in the early stages of HIV disease with the goal of prolonging life, health and productivity. These programs also provide health and behavior change education, with the goal of preventing further HIV infections. While the current EIPs serve 8,300 clients annually, thousands more low-income, uninsured HIV-infected individuals could benefit from these services if more funding were made available to expand the number of early intervention sites.
  
  
• Housing: The state should also use some of the ADAP dollars to fund HIV/AIDS-specific housing efforts. The state has not provided funds for HIV-specific housing since 1996 and this fact, combined with the dramatically increasing need for housing, has contributed to an emergency situation for people with HIV/AIDS in many parts of the state (more specifics on housing are included in the housing section).
  
  
• Diagnostic Testing: Beginning in FY 1997-1998, the state added $3.8 million to the budget for viral load testing, which measures the amount of virus in a patient's blood and provides critical information for treatment decision-making. Important additional diagnostic tests are in development and are likely to be incorporated into the current standard of care for HIV. State policy makers should work to ensure access to these tests for the uninsured by considering funding for new diagnostic tests.

Recommendations - HIV Care and Treatment Services

• The Governor and State Legislature should advocate aggressively for increases in federal funding for care and treatment through all Titles of the Ryan White CARE Act--including ADAP--and for timely reauthorization of the CARE Act.
  
  
• Funding for ADAP must ensure access to the program for all Californians who are currently eligible and should allow for continued expansion of the list of drugs available through ADAP. ADAP administration should continue to be centralized statewide.
  
  
• If state contributions to ADAP are reduced, as proposed in the Governor's FY 1999-2000 budget, the state should reallocate those dollars to other HIV programs, including early intervention programs, diagnostic testing and HIV-specific housing efforts.

Page last updated February 24 1999

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