BILL ANALYSIS                                                                                                                                                                                                    






                                 SENATE HEALTH
                               COMMITTEE ANALYSIS
                        Senator Elaine K. Alquist, Chair


          BILL NO:       SB 438                                       
          S
          AUTHOR:        Yee                                          
          B
          AMENDED:       April 23, 2009                              
          HEARING DATE:  April 29, 2009                               
          4
          CONSULTANT:                                                 
          3
          Dunstan/cjt                                                 
          8              
                                        
                                     SUBJECT
                                         
                        Medi-Cal: accelerated enrollment

                                     SUMMARY  

          Requires the Department of Health Care Services (DHCS), to  
          seek federal approval for an option to accelerate Medi-Cal  
          enrollment for children and pregnant women who apply for  
          Medi-Cal at a county welfare office.  Transfers Healthy  
          Families program eligibility determination to county  
          welfare offices.


                             CHANGES TO EXISTING LAW  

          Existing federal law:
          Establishes the Medicaid program which provides  
          comprehensive health coverage to low-income eligible  
          individuals and families, including children; the aged,  
          blind, and disabled; and pregnant women, through a program  
          that reimburses states for the Medicaid programs in the  
          individual states.  Existing federal law establishes the  
          Children's Health Insurance Program (CHIP) which provides  
          matching funds for state health insurance programs.  

          Provides specific guidance for determining eligibility for  
          Medicaid and CHIP while preserving flexibility for states  
          to administer according to the needs of the state.
                                                         Continued---



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          Existing state law:
          Establishes the state's Medicaid program known as Medi-Cal,  
          administered by DHCS, which provides comprehensive health  
          benefits to low-income children; their parents or caretaker  
          relatives; pregnant women; elderly, blind or disabled  
          persons; nursing home residents; and refugees who meet  
          specified eligibility criteria.

          Authorizes DHCS to establish an accelerated enrollment for  
          children making enrollment changes between Healthy Families  
          and Medi-Cal, for children enrolling in Medi-Cal through  
          the Child Health and Disability Program, children who apply  
          for free lunches through the National School Lunch program  
          and for children enrolling through the single point of  
          entry, a centralized administrative entity. 

          Establishes the Healthy Families program to provide  
          low-cost insurance, including health, dental and vision  
          coverage to children who do not have health insurance, do  
          not qualify for free Medi-Cal and are in families at or  
          below 250 percent of the federal poverty level.

          Provides that the Managed Risk Medical Insurance Board  
          (MRMIB) administers Healthy Families.  

          This bill:
          Requires MRMIB to transfer eligibility determination to  
          counties beginning January 1, 2011 and requires MRMIB and  
          stakeholders to consult regarding the procedure for  
          transferring eligibility determinations.

          Authorizes MRMIB to continue to contract with a private  
          entity for other administrative activities.

          Requires DHCS to exercise the option for accelerated  
          enrollment for pregnant women and children who apply for  
          Medi-Cal at a county welfare office, provided that federal  
          financial participation is available.

          Directs DHCS to seek federal approval for any state plan  
          amendments required to implement this bill.

          Allows DHCS to implement this bill through all-county  
          letters initially and then adopt regulations for any  
          subsequent actions.




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          Directs a county, if it determines that a pregnant woman or  
          a child appears eligible for Medi-Cal, to grant them  
          accelerated enrollment into Medi-Cal.

          Requires counties to perform a complete eligibility  
          determination and, if the pregnant woman or child is found  
          to be ineligible, report that to DHCS so that benefits can  
          be discontinued.


                                  FISCAL IMPACT 

          Unknown.

                            BACKGROUND AND DISCUSSION  

          According to the author, this bill seeks to expand access  
          to health care services by streamlining enrollment in the  
          state's Medi-Cal program. The author argues that this bill  
          will accelerate and simplify enrollment by allowing the  
          county welfare office to immediately enroll children who  
          appear to meet the eligibility requirements. The author  
          points out that accelerated enrollment is allowed through  
          the state's single point of entry, the Child Health and  
          Disability Program and between the Healthy Families and  
          Medi-Cal programs. Ironically, the traditional point of  
          entry for many applying for Medi-Cal is the one place where  
          they cannot get the accelerated enrollment, the county  
          welfare office.

          Uninsured children
          There are approximately 700,000 children in California who  
          are not covered by health insurance, according to  
          researchers.  Many of these uninsured children come from  
          low-income working families.  As a result of the lack of  
          insurance, they are less likely to visit a doctor, less  
          likely to receive preventive services, and may delay  
          seeking necessary care. Often when they seek care, they  
          have more serious conditions and require more extensive and  
          costly treatment.

          According to the UCLA Center for Health Policy Research, of  
          the nearly 700,000 children who are uninsured, over half  
          are eligible for two of California's public health  
          insurance programs; approximately 200,000 for Medi-Cal and  




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          180,000 for Healthy Families.  Another 150,000 are eligible  
          for local children's programs, although these are not  
          offered in all counties.  Approximately the same number are  
          not eligible for either of the state programs because of  
          income or immigration status.

          Studies have reported that when parents of uninsured  
          children who are potentially eligible for Medi-Cal were  
          asked why their children were not enrolled, only eight  
          percent reported being unsure about their children's  
          eligibility as the reason for not applying, and less than  
          one percent did not know the program existed.  However,  
          parents of about one in eight uninsured eligible children  
          objected to some characteristics of the program,  
          particularly the onerous paperwork.  

          Consequences of being uninsured
          Again, according to a report by the UCLA Center for Health  
          Policy Research, uninsured children reported slightly lower  
          health status than those enrolled in Medi-Cal or Healthy  
          Families.  Over three-fourths of insured children or their  
          parents reported their health as "excellent" or "very  
          good," while less than half of uninsured children reported  
          the same.  Uninsured children were also more than three  
          times as likely to report their health status as "fair" or  
          "poor" than those with job-based coverage.  Nearly half of  
          the uninsured reported no usual source of care and were  
          only half as likely as those with Medi-Cal to list a  
          doctor's office or health maintenance organization as their  
          usual source of care and only one-third as likely as those  
          with job-based coverage or individually purchased private  
          insurance.  Over 50 percent of the uninsured cited lack of  
          insurance or cost as a reason for not having a usual source  
          of care, compared to about 33 percent of those with  
          Medi-Cal or other public coverage and less than one percent  
          of those with job-based or individually purchased coverage.  

          

          Previous efforts to ease program requirements 

          The state has implemented a number of eligibility  
          streamlining changes for children that this bill would  
          build on.  For example, the Child Health and Disability  
          Prevention Program (CHDP) "Gateway" provides access for  
          uninsured children to the Medi-Cal or the Healthy Families  




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          program through an automated pre-enrollment process.  

          Another effort to streamline enrollment that the state has  
          embarked on is "Express Enrollment."  This concept was  
          established after it was noted that many children eligible  
          for, but not enrolled in, health insurance programs, were  
          participating in existing public programs such as School  
          Lunches, Food Stamps, and Women, Infants, and Children  
          (WIC).  Under the state's Express Enrollment program, the  
          application for the school lunch program is used, when the  
          parent or guardian consents, for determining Medi-Cal  
          eligibility.  If the child is eligible for free lunches,  
          the application is forwarded to the county, and a  
          determination is made regarding eligibility for no-cost  
          Medi-Cal.  If the child is eligible only for reduced-cost  
          lunches, no Medi-Cal determination is made.  

          Related legislation
          SB 1 (Steinberg), among its other provisions, would have  
          established presumptive eligibility for children in  
          families applying for Medi-Cal at county eligibility  
          offices.  This bill is in Senate Health Committee.

          Prior legislation
          SB 1459 (Yee) of 2008, among its other provisions, would  
          have established presumptive eligibility for children in  
          families applying for Medi-Cal at county eligibility  
          offices.  This bill was held in Senate Appropriations  
          Committee.
          
          SB 32 (Steinberg) of 2008 among its other provisions, would  
          have established presumptive eligibility for children in  
          families applying for Medi-Cal at county eligibility  
          offices.  SB 32 was held in the Assembly.

          AB 1 (Laird) of 2008 among its other provisions, would have  
          established presumptive eligibility for children in  
          families applying for Medi-Cal at county eligibility  
          offices.  AB 1 was held in the Assembly.
          
          SB 437 (Escutia), Chapter 328, Statutes of 2006,  
          established the Healthy Families Presumptive Eligibility  
          Program and would have required the DHCS to implement a  
          process for self-certification of assets and income for  
          various eligibility categories under the Medi-Cal program. 





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          AB 624 (Monta?ez) of 2005  would have required the DHS and  
          the MRMIB to, by July 1, 2007, include an application  
          process to be used at the option of the person applying on  
          the child's behalf, to simultaneously pre-enroll and apply  
          for enrollment into the Healthy Families or Medi-Cal  
          programs.  This bill was vetoed by Governor Schwarzenegger.

          Arguments in support
          The California Nurses Association, the bill's sponsor,  
          states that two-thirds of the children in California that  
          are uninsured are eligible for one of the state's public  
          programs.  They argue that SB 438 will close those ranks by  
          allowing counties to grant accelerated enrollment of  
          children and pregnant women into Medi-Cal.  They also point  
          out that full eligibility determinations will still be done  
          to ensure if benefits will be continued.  The Western  
          Center on Law and Poverty (WCLP) points out that there is  
          currently a strange anomaly whereby if a child applies  
          through the state's single point of entry, they can get  
          Medi-Cal in a few days.  However, if that same child  
          applies through a county welfare office and provides the  
          same information, the process is slower.  WCLP argues that  
          the current screen done by the single point of entry is  
          incomplete because it looks at eligibility for only a few  
          of the many eligibility categories of Medi-Cal.  WCLP  
          states that counties are best equipped to accurately make  
          Medi-Cal determinations, apply the program's many complex  
          eligibility rules, and sort through the program's varying  
          income level and rules.  

          County Welfare Directors of California argues that this  
          bill will create equity for children and pregnant women  
          whose applications for Medi-Cal are filed directly with the  
          county human services departments rather than mailed in  
          through the single point of entry.  They point out that  
          this process is already in use by other entities than  
          counties.

                                        
                                     COMMENTS
           
          1.  The author is proposing an amendment to eliminate  
          provisions of the bill related to Healthy Families.  As  
          currently drafted the bill would require the Managed Risk  
          Medical Insurance Board to shift eligibility determinations  
          for Healthy Families to the county welfare offices.  The  




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          author proposes to amend the bill by deleting those  
          provisions.

          Proposed amendment
          Page 3, delete lines 4 through 25. 
           SEC. 2. Section 12693.766 is added to the Insurance Code,  
          to read: 12693.766. 
          (a) Notwithstanding any other provision of this part, on or  
          before July 1, 2010, the board, in consultation with the  
          State Department of Health Care Services, shall begin the  
          transfer of initial and ongoing eligibility determinations  
          for the program to the county departments. The counties  
          shall assume full responsibility for the eligibility  
          determinations for the program by January 1, 2011. 
          (b) The board and the department shall consult with  
          stakeholders, including counties and advocates for program  
          clients, in the development of procedures for transferring  
          the responsibility for determinations to the county level. 
          (c) Upon transfer of program eligibility determinations to  
          the county level, the collection of family contributions  
          and participating health plan selection may continue to be  
          contracted to a private entity. In order to maximize  
          efficiency, it is the intent of the Legislature that plan  
          selection and collection of contributions be incorporated,  
          to the extent possible, into the Medi-Cal managed care  
          enrollment broker contract administered by the State  
          Department of Health Care Services. 
           
          Technical amendment
          Page 9, beginning line 20
          (f) Upon the receipt of an application for a child directly  
          from the parent  pregnant woman  or from another source on  
          behalf of the child, or  an application  for a pregnant woman  
          directly from the pregnant woman  parent  or another source  
          on behalf of the pregnant woman, the county shall determine  
          whether the child or pregnant woman appears eligible for  
          Medi-Cal benefits and, if so, grant accelerated enrollment  
          to the child or pregnant woman.  Upon the granting of  
          accelerated enrollment for a child or pregnant woman, the  
          county shall determine whether the child or pregnant woman  
          is eligible for Medi-Cal benefits. If the county determines  
          that the child or pregnant woman does not meet the  
          eligibility requirements for participation in the Medi-Cal  
          program, the county shall report this finding to the  
          Medical Eligibility Data System so that accelerated  
          enrollment coverage benefits are discontinued.  If the  




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          county determines that the child is eligible for the  
          Medi-Cal program with a share of cost, the county shall  
          enroll the child in the Medi-Cal program and forward the  
          application to the Managed Risk Medical Insurance Board for  
          an evaluation of the child's eligibility for the Healthy  
          Families Program.


                                    POSITIONS  


          Support:   California Nurses Association (sponsor)
                 County Welfare Directors of California
                 Western Center on Law and Poverty

                 Previous version of bill
                 American Federation of State, County and Municipal  
            Employees
                 California Medical Association
                 California Primary Care Association 
                 California Psychological Association

          
          Oppose:     None received


                                   -- END --