BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
1269 (Brownley)
Hearing Date: 8/27/2009 Amended: 4/14/2009
Consultant: Katie Johnson Policy Vote: Health 8-3
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BILL SUMMARY: AB 1269 would make various eligibility changes to
the California Working Disabled Program (CWD).
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Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11 2011-12 Fund
Increase CWD caseload $0 $20 - $30 $300 -
$350 General/
benefits Federal
*October 1, 2008 - December 31, 2010 FMAP = 38%GF / 62%FF
January 1, 2011 - ongoing FMAP = 50%GF / 50%FF
FMAP = Federal Medical Assistance Percentage-the percent of
total costs paid by the federal government.
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STAFF COMMENTS: SUSPENSE FILE. AS PROPOSED TO BE AMENDED.
Existing law established the California Working Disabled Program
(CWD) in 2000 and, in 2008, the Budget Act made the program
permanent. CWD provides Medi-Cal health benefits to working
disabled individuals with a net family income of up to 250
percent of the federal poverty level (FPL), or $25,525 for an
individual. CWD enrollees pay monthly premiums of $20 - $375
depending on the enrollee's countable income.
This bill would permit CWD enrollees who were temporarily
unemployed to retain Medi-Cal coverage for up to 26 weeks
provided the enrollee continued to pay premiums during this
period. Currently, CWD enrollees whose employment was terminated
due to good cause may retain Medi-Cal coverage for up to two
months.
Additionally, this bill would make several changes to the
determination of CWD eligibility. It would add the following
types of income to those exempted when determining CWD
eligibility: 1) retained earned income held in a separately
identifiable account, and 2) social security disability income
that would convert to social security retirement income upon the
retirement of an individual. This bill would require DHCS to
submit a state plan amendment (SPA) to the Centers for Medicare
and Medicaid (CMS) specifically for the second exemption and
would provide that the exemption would go into effect only if
the SPA was approved.
This bill would require that all resources in the form of
employer or individual retirement arrangements that are
currently exempt for CWD eligibility determination would be
exempt when determining a CWD enrollee's eligibility for any
other Medi-Cal program for which the enrollee may eligible
provided the eligibility is based on age, blindness, or
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AB 1269 (Brownley)
disability. This bill would require DHCS to seek a SPA for this
provision and that this provision would be implemented only if
the SPA were approved by CMS.
This bill would provide that an individual's countable income
would be used to determine the amount of his or her monthly
premium and would require that disability income and converted
retirement income made exempt for purposes of CWD eligibility
determination be considered countable income for purposes of
determining the premium amount.
This bill would eliminate the determination of a sliding premium
scale, and would instead require that each individual pay 5
percent of his or her individual countable income as a premium.
$20 would be the minimum monthly premium and $250 would be the
maximum. This bill would be effective no later than March 1,
2010.
Since this bill would change the eligibility determination for
CWD, it would necessitate changes at county eligibility offices.
To the extent that these changes create costs to local
jurisdictions, the state would be required to reimburse those
expenses. Those expenses are estimated to be minor and
absorbable. Additionally, since this bill would expand the pool
of eligible Californians, CWD would expect an increase in
caseload. Current enrollment in CWD is approximately 4,500
individuals. Although CWD enrollees pay premiums to participate
in the program, the premiums do not offset the entire cost of
the program. Thus, to the extent individuals choose to
participate in CWD and, if unemployed, continue Medi-Cal
coverage, DHCS would be required to pay for corresponding
benefits.
If enrollment were to increase at 5 individuals per month, the
cost would be approximately $20,000 - $30,000 in FY 2009-10,
$300,000 - $350,000 in FY 2011-12, and $400,000 - $500,000
ongoing in total funds to provide for benefits. Additionally,
there would be one-time, likely minor and absorbable costs to
incorporate the eligibility changes into the Medi-Cal claims
computer system and to train county eligibility workers.
Medi-Cal costs are generally shared equally between the federal
government (FF) and state general fund (GF). However, as a
result of the passage of the American Reinvestment and Recovery
Act (ARRA) in February of 2009, the Federal Medical Assistance
Percentage (FMAP) increased from 50 percent to 61.59 percent.
Thus, retroactively from October 1, 2008 through December 31,
2010, the federal government would pay for approximately 62
percent and the state general fund would pay for 38 percent of
benefit-related Medi-Cal expenditures. After December 31, 2010,
the FMAP reduces to 50 percent FF, 50 percent GF.
The author's proposed amendments would delay this bill's
implementation until ARRA enhanced FMAP provisions sunset, which
would likely be January 1, 2011, so as to not jeopardize ARRA
funds. The federal Centers for Medicare and Medicaid Services
(CMS), the Medicaid regulating body, could construe this bill to
limit eligibility for CWD. In return for receiving ARRA funds,
ARRA prohibits states from negatively impacting Medi-Cal
eligibility.