BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 36
                                                                  Page  1

          Date of Hearing:   July 6, 2011

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                   SB 36 (Simitian) - As Amended:  March 29, 2011 

          Policy Committee:                             HealthVote:15-4

          Urgency:     No                   State Mandated Local Program: 
          No     Reimbursable:              No

           SUMMARY  

          This bill allows counties who apply to participate in the County 
          Health Initiative Matching fund (CHIM) program to cover children 
          in families with incomes of up to 400% of the federal poverty 
          level (FPL), instead of 300% FPL as in current law. In addition, 
          this bill modifies CHIM eligibility to account for enrollment 
          freezes and other access issues created in the Healthy Families 
          Program (HFP) due to budget shortfalls.

           FISCAL EFFECT  

          1)Minor costs to the Managed Risk Medical Insurance Board 
            (MRMIB) to expand the administration of CHIM to support the 
            counties access to federal funding.  Any additional 
            administrative costs would be reimbursed by participating 
            counties.

          2)Premium expenditures through the CHIM special fund, 
            potentially in the hundreds of thousands of dollars (50% 
            federal/50% local) to extend coverage to additional children. 

           COMMENTS  

           1)Rationale  . This bill is sponsored by San Mateo County to allow 
            the receipt of additional federal funding, which would match 
            local funding for children's health care coverage. This bill 
            also addresses concerns about limited future eligibility in 
            the Healthy Families Program due to funding shortfalls, by 
            allowing CHIM programs to fund children who are denied 
            enrollment in HFP due to insufficient funds. 

           2)Children's Health Coverage Programs  . The Medi-Cal program and 








                                                                  SB 36
                                                                  Page  2

            HFP each provide health benefits to low-income children.  
            Family income eligibility for children in Medi-Cal is at or 
            below 200% FPL for infants to age one, 133% FPL for children 
            ages one through five, and 100% FPL for children ages six 
            through 18.  Children in families with incomes above these 
            amounts but below 250% FPL may be eligible for HFP.  

           3)The Children's Health Initiative Matching Fund Program  was 
            established by AB 495 (Diaz), Chapter 648, Statues of 2001, 
            which also established a CHIM special fund. The CHIM program 
            essentially allows counties to expand income eligibility for 
            HFP at county option, using local funds as the state match to 
            draw down federal funds.  To date, three counties (San 
            Francisco, Santa Clara, and San Mateo) have established CHIM 
            programs.   
                
            4)HFP Funding  . In 2009, the HFP had a shortfall of almost $200 
            million GF, and enrollees faced a waiting list for two months 
            as reductions were implemented and alternative funding sources 
            were located.  The federal Affordable Care Act required that 
            the state maintain "eligibility standards, methods and 
            procedures" in effect on March 23, 2010, as a condition of 
            continued Medicaid funding.  Thus, it is unlikely that the 
            board will be able to limit enrollment due to insufficient 
            funds.

           5)Pending State and Federal Changes  .  State legislative budget 
            committees recently approved the transfer of children enrolled 
            in HFP to the Medi-Cal program, and the eventual elimination 
            of HFP as a separate program.  Details of this transfer are 
            still pending, and the potential effect of this transfer on 
            the CHIM program is unknown at this time.  

            In addition, beginning in 2014, the federal Affordable Care 
            Act will provide subsidized health care coverage for all legal 
            residents with incomes under 400% of the FPL, through the 
            California Health Benefits Exchange.  


           Analysis Prepared by  :    Lisa Murawski / APPR. / (916) 319-2081