BILL ANALYSIS                                                                                                                                                                                                    




                    Appropriations Committee Fiscal Summary
          
                                           2 (Burton)
          
          Hearing Date:  5/29/03          Amended: 3/18/03       
          Consultant:  George Cate            Policy Vote: INS 6-3  
          H&HS 9-3                 
          ____________________________________________________________ 
          ___
          BILL SUMMARY: SB 2 creates the State Health Purchasing  
          Program (SHPP) that shall be managed by the Managed Risk  
          Medical Insurance Board (MRMIB).  This bill also requires  
          employers, with an unspecified number of employees, to  
          provide health care coverage to employees and dependents,  
          as specified, by purchasing coverage from any health plan,  
          providing coverage through a self-funded employer-sponsored  
          plan, or by paying a fee to SHPP, which would use a  
          purchasing pool to provide coverage.

          In addition, this measure authorizes an employer to require  
          an eligible employee to pay up to 20 percent of the cost of  
          the coverage.  The bill requires the Employment Development  
          Department (EDD) to collect the fee and employee  
          contributions, and deposit them into the newly created  
          State Health Purchasing Fund.  The bill also continuously  
          appropriates money in the Fund to MRMIB for SHPP.   
          Furthermore, this bill authorizes MRMIB to coordinate SHPP  
          coverage with the Medi-Cal program and Healthy Families  
          Program, and requires MRMIB to establish copayments and  
          deductibles for enrollees.
                              Fiscal Impact (in thousands)
           
          Major Provisions       2003-04            2004-05               2005-06   
           Fund  
          
          MRMIB & EDD                  Indeterminate costs  General*
          Medi-Cal          Indeterminate savings           General &
                                                              Federal**
          HFP               Indeterminate savings           General &
                                                              Federal***
          Employers &       Indeterminate costs        Private
            Employees

                * Potential General Fund exposure for start-up costs
               **Medi-Cal is approximately 50% General Fund & 50% federal  
          funds










              ***HFP is approximately 33% General Fund & 67% federal funds

          STAFF COMMENTS:  SUSPENSE FILE
          Estimates for the costs and savings associated with this  
          measure are indeterminate at this time.  There would be  
          significant start-up costs for MRMIB, EDD and the  
          Department of Health Services (DHS), some of which may have  
          to be borne by the General Fund.  Once SHPP is up and  
          running there should be substantial savings to both the  
          Medi-Cal program and HFP.

          PROPOSED AMENDMENTS would reduce this bill to legislative  
          intent to ensure that all working Californians and their  
          families are provided health care coverage.