BILL ANALYSIS Senate Appropriations Committee Fiscal Summary Senator Christine Kehoe, Chair 2352 (J. Perez) Hearing Date: 8/2/2010 Amended: 7/15/2010 Consultant: Katie Johnson Policy Vote: Health 6-0 _________________________________________________________________ ____ BILL SUMMARY: AB 2352 would require that a Medi-Cal beneficiary remain eligible for Medi-Cal coverage of antirejection medication for up to two years following an organ transplant, unless he or she becomes eligible for other insurance that would cover the medication, including Medicare. _________________________________________________________________ ____ Fiscal Impact (in thousands) Major Provisions 2010-11 2011-12 2012-13 Fund Medication costs $190 $400 $400General _________________________________________________________________ ____ STAFF COMMENTS: This bill meets the criteria for referral to the Suspense File. Medi-Cal currently pays for antirejection medication for one-year after a transplant. This bill would require that a Medi-Cal beneficiary remain eligible for Medi-Cal coverage of antirejection medication for up to two years following an organ transplant. Medi-Cal coverage would cease if the individual were to become eligible for either Medicare or other private health insurance that would cover the medication. Since this bill would increase the time a beneficiary may claim Medi-Cal coverage, it would increase costs to the Medi-Cal program. Antirejection medication costs Medi-Cal approximately $20,000 annually. Approximately 1,450 individuals receive organ transplants through Medi-Cal fee-for-service coverage annually. If 1 percent of individuals who had received an organ transplant were to utilize services for the extra year, 15 individuals, as provided for under this bill, the annual cost would be $300,000. From 2005-2007, there were 45 individuals, or the 15 individuals per year, who had a lapse in Medi-Cal coverage during months 13 - 24 post-transplant. Since 26 percent of Medi-Cal seniors and persons with disabilities, the categories under which an individual receiving an organ transplant would fall, are in Medi-Cal managed care, it would be reasonable that the number of people with lapsed coverage would be substantially lower for Medi-Cal managed care than for fee-for-service. If 15 individuals equals 74 percent of Medi-Cal enrollees, then 5 individuals equals 26 percent of total enrollees and represents the individuals in managed care who would likely use this bill. Total costs then could be expected to be approximately $400,000 annually. There could be cost avoidance to the extent that the provision of antirejection medication for an additional year would prevent hospitalization for transplant rejection and another transplant. This expansion of Medi-Cal benefits is not a mandatory or state option under federal Medicaid law. Therefore, federal matching funds would not be available to match costs related to this bill. The costs incurred by Medi-Cal would be 100 percent General Fund. The Department of Health Care Services (DHCS) would be permitted to implement or interpret these provisions by means of all-county letters, provider bulletins, or similar instructions without taking any other regulatory action.