BILL ANALYSIS Ó
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THIRD READING
Bill No: SB 1081
Author: Fuller (R)
Amended: 4/10/12
Vote: 27 - Urgency
SENATE HEALTH COMMITTEE : 8-0, 3/28/12
AYES: Hernandez, Harman, Alquist, Anderson, Blakeslee, De
León, Rubio, Wolk
NO VOTE RECORDED: DeSaulnier
SENATE APPROPRIATIONS COMMITTEE : 7-0, 4/30/12
AYES: Kehoe, Walters, Alquist, Dutton, Lieu, Price,
Steinberg
SUBJECT : Public health care: Medi-Cal: demonstration
projects
SOURCE : District Hospital Leadership Forum
DIGEST : This bill allows a non-designated public
hospital (hospitals owned by a local health care district)
to operate an approved Low Income Health Program (LIHP) if
it is located in a county that does not have a designated
public hospital and does not intend to operate an LIHP.
ANALYSIS :
Existing law:
1. Establishes the Medi-Cal program, which is administered
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by the Department of Health Care Services (DHCS), under
which qualified low-income individuals receive health
care services.
2. Requires DHCS, pursuant to federal approval of a
demonstration project, to authorize local LIHPs to
provide health care services to eligible low-income
individuals under certain circumstances. LIHPs are
established at local option, and are authorized to cover
individuals up to 200 percent of the federal poverty
level (FPL) (200 percent of the FPL is at or below
$22,340 for an individual in 2012).
3. Defines the entities authorized to operate an approved
LIHP as follows: a county, a city and county, a
consortium of counties serving a region of more than one
county, or a health authority.
This bill:
1. Expands the entities authorized to operate an LIHP by
allowing a non-designated public hospital to operate an
approved LIHP if it is located in a county that does not
have a designated public hospital and does not intend to
operate an LIHP.
2. Defines "non-designated public hospital" using the
definition in existing Medic-Cal law.
3. Clarifies how a county that does not intend to operate
an LIHP makes specified decision and under what time
frame.
Background
In 2010, the Legislature passed and Governor Schwarzenegger
signed into law AB 342 (John A. Pérez), Chapter 723,
Statutes of 2010, and SB 208 (Steinberg), Chapter 714,
Statutes of 2010, a two-bill package to implement a new
federal demonstration project entitled California's "Bridge
to Reform." AB 342 authorized the LIHPs (originally called
Coverage Expansion and Enrollment Demonstration) that built
upon the Health Care Coverage Initiatives (HCCIs)
established under the 2005 demonstration project. Under the
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2005 waiver, a total of $180 million in federal funds were
allotted annually to the county-based HCCIs in years three,
four, and five of the 2005 waiver (September 1, 2007
through August 31, 2010) to provide coverage to
medically-indigent adults who are not eligible for other
public programs.
AB 342 extended the 10 "legacy" HCCIs funded under the 2005
demonstration project, and authorized the expansion of the
HCCIs statewide using an early implementation option
created by the federal health care reform bill (the Patient
Protection and Affordable Care Act or ACA). The ACA
requires states, by January 1, 2014, to cover adults under
age 65 and with family incomes up to 138 percent of the FPL
(at or below $15,414 in 2012) in their Medicaid program.
Under the ACA, states have the option of drawing down
federal funds for early implementation of this provision.
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Unknown, but likely minor, state costs. All state costs
to be fully reimbursed by participating non-designated
public hospitals.
Additional local government reimbursements up to $2.7
million (federal funds).
SUPPORT : (Verified 5/1/12)
District Hospital Leadership Forum (source)
Alameda Hospital
Antelope Valley Hospital
Coalinga Regional Medical Center
Hazel Hawkins Memorial Hospital
Hi-Desert Memorial Health Care District
Lompoc Valley Medical Center
Marin General Hospital
Palomar Health
Salinas Valley Memorial Healthcare System
San Benito Health Care District
San Bernardino Mountains Community Hospital District
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Association of California Healthcare Districts
Kaweah Delta Health Care District
Tri-City Medical Center
Western Center on Law & Poverty
ARGUMENTS IN SUPPORT : This bill is sponsored by the
District Hospital Leadership Forum (DHLF), which represents
California's health care district-operated acute-care
hospitals, to allow a public district hospital to become an
LIHP contractor in counties that are both without a county
hospital and are not interested in becoming an LIHP
contractor. DHLF states that while public district
hospitals can negotiate with an LIHP contractor to
participate in an LIHP provider network, they cannot become
an LIHP contractor under the implementing legislation.
DHLF states this restricts the flow of these federal
dollars to California and limits access to care for
uninsured Californians in counties that are without a
county hospital and that are not interested in becoming an
LIHP contractor. DHLF concludes that allowing district
hospitals to act as an LIHP contractor will result in
expanded coverage to more areas in California without a
cost to the state General Fund
CTW:do 5/2/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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