BILL ANALYSIS ------------------------------------------------------------ |SENATE RULES COMMITTEE | AB 1269| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ THIRD READING Bill No: AB 1269 Author: Brownley (D) Amended: 9/1/09 in Senate Vote: 21 SENATE HEALTH COMMITTEE : 8-3, 7/8/09 AYES: Alquist, Cedillo, DeSaulnier, Leno, Maldonado, Negrete McLeod, Pavley, Wolk NOES: Strickland, Aanestad, Cox SENATE APPROPRIATIONS COMMITTEE : 8-5, 8/27/09 AYES: Kehoe, Corbett, Hancock, Leno, Oropeza, Price, Wolk, Yee NOES: Cox, Denham, Runner, Walters, Wyland ASSEMBLY FLOOR : 50-29, 6/2/09 - See last page for vote SUBJECT : Medi-Cal eligibility: California Working Disabled Program SOURCE : Author DIGEST : This bill expands the Medi-Cal California Working Disabled Program (CWD) by allowing additional resource exemptions when determining initial and continued eligibility for the program. The exempted resources would include Social Security disability benefits and income, as well as retained earned income which is held in a separate account, provided that federal financial participation is available. This bill also allows 26 weeks of continued CONTINUED AB 1269 Page 2 eligibility for the Medi-Cal program when a disabled participant is temporarily unemployed, provided they continue to make premium payments. In addition, this bill replaces the current sliding scale for premiums with a monthly premium set at five percent of the individual's countable income subject to a $20 minimum and a $250 maximum. This bill delays implementation until the federal American Recovery and Reinvestment Act of 2009 (ARRA) enhanced Federal Medical Assistance Percentage provisions sunset, which will likely be January 1, 2011, so as to not jeopardize ARRA funds. The federal Centers for Medicare and Medicaid Services, 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. This bill specifies that if any provision of this bill, or its application, is held invalid by a final judicial determination, it shall cease to be implemented. A determination of invalidity shall not affect other provisions or applications of this section that can be given effect without the implementation of the invalid provision or application. ANALYSIS : Existing law established the 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, or $25,525 for an individual. CWD enrollees pay monthly premiums of $20-$375 depending on the enrollee's countable income. This bill permits 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 makes several changes to the determination of CWD eligibility. It adds 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 CONTINUED AB 1269 Page 3 retirement income upon the retirement of an individual. This bill requires the Department of Health Care Services (DHCS) to submit a state plan amendment to the Centers for Medicare and Medicaid specifically for the second exemption and would provide that the exemption would go into effect only if the state plan amendment was approved. This bill requires 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 disability. This bill requires DHCS to seek a state plan amendment for this provision and that this provision would be implemented only if the state plan amendment were approved by the Centers for Medicare and Medicaid. This bill provides that an individual's countable income would be used to determine the amount of his/her monthly premium and requires 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 eliminates the determination of a sliding premium scale, and instead requires that each individual pay five percent of his/her individual countable income as a premium. The minimum monthly premium would be $20 and $250 would be the maximum. This bill specifies that if any provision of this bill, or its application, is held invalid by a final judicial determination, it shall cease to be implemented. A determination of invalidity shall not affect other provisions or applications of this section that can be given effect without the implementation of the invalid provision or application. Prior Legislation AB 1183 (Assembly Budget Committee), Chapter 758, Statutes of 2008, made the CWD program permanent by deleting the CONTINUED AB 1269 Page 4 September 1, 2008 sunset date. AB 851 (Brownley), 2007-08 Session, which was similar to this bill, was held on the Senate Appropriations suspense file. AB 1113 (Brownley), 2007-08 Session, which was similar to this bill, was vetoed by Governor Schwarzenegger. In his veto message, the Governor stated: "While I strongly support the California 250 Percent Working Disabled Program and appreciate its role in promoting work among persons who are aged and disabled, I cannot support this bill. This bill contains a drafting error that would result in unequal treatment of similarly situated aged persons, in direct conflict with federal Medicaid law. Given my strong support of services for persons with disabilities to allow them to safely remain at home and lead productive and independent lives, I am directing the DHCS to pursue legislation to continue and improve this important program." AB 155 (Migden), Chapter 820, Statutes of 1999, established the CWD program. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: Yes According to the Senate Appropriations Committee: 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 - the percent of total costs paid by the federal government CONTINUED AB 1269 Page 5 SUPPORT : (Verified 9/1/09) Abilicorp AIDS Project Los Angeles American Federation of State, County and Municipal Employees Association of California State Employees with Disabilities California Communities United Institute California Foundation for Independent Living Centers California Medical Association California Primary Care Association Disability Rights California Easter Seals of Southern California Health Access National Multiple Sclerosis Society Pacific Clinics Project Return Peer Support Network Resources for Independent Living San Francisco AIDS Foundation Southern California HIV Advocacy Coalition World Institute on Disability ARGUMENTS IN SUPPORT : Supporters argue that this bill will encourage people to enter the labor force and the CWD program, because if they become unemployed they could continue to receive their coverage. They argue that many individuals are afraid to enter the labor force for fear of losing their affordable Medi-Cal coverage. Supporters argue that the other eligibility changes will allow more people with disabilities to become more independent and productive while ensuring that they have access to critical health services. Supporters note that it makes fiscal sense to encourage disabled people to work and contribute to the cost of health coverage. ASSEMBLY FLOOR : AYES: Ammiano, Arambula, Beall, Blumenfield, Brownley, Buchanan, Caballero, Charles Calderon, Carter, Chesbro, Cook, Coto, Davis, De La Torre, De Leon, Eng, Evans, Feuer, Fong, Fuentes, Furutani, Galgiani, Hall, Hayashi, Hernandez, Hill, Huffman, Jones, Krekorian, Lieu, Bonnie Lowenthal, Ma, Mendoza, Monning, Nava, John A. Perez, V. CONTINUED AB 1269 Page 6 Manuel Perez, Portantino, Price, Ruskin, Salas, Saldana, Skinner, Solorio, Swanson, Torlakson, Torres, Torrico, Yamada, Bass NOES: Adams, Anderson, Bill Berryhill, Tom Berryhill, Blakeslee, Conway, DeVore, Duvall, Emmerson, Fletcher, Fuller, Gaines, Garrick, Gilmore, Hagman, Harkey, Huber, Jeffries, Knight, Logue, Miller, Nestande, Niello, Nielsen, Silva, Smyth, Audra Strickland, Tran, Villines NO VOTE RECORDED: Block DLW:mw 9/1/09 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED