BILL ANALYSIS Ó SB 1081 Page 1 Date of Hearing: August 8, 2012 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair SB 1081 (Fuller) - As Amended: June 20, 2012 Policy Committee: HealthVote:19-0 Urgency: Yes State Mandated Local Program: No Reimbursable: No SUMMARY This bill adds Non-Designated Public Hospitals (NDPHs) to the list of eligible entities authorized to operate a Low-Income Health Program (LIHP), if the hospital is located in a county that does not have a designated public hospital and the county does not intend to operate a local LIHP. This bill also requires the Department of Health Care Services (DHCS) to seek federal approval, and makes implementation of the bill contingent on receipt of federal approval. FISCAL EFFECT 1)Minor administrative costs to DHCS to seek federal approval for this change and review applications from hospitals to operate LIHPs. These administrative costs are funded by 50% federal funds, 50% local funds from participating entities. Given the short time frame and unique circumstances, only one county (Tulare County) is expected to apply pursuant to this bill. 2)If an NDPH operated a LIHP pursuant to this bill, local funds for health care services would also be matched by new federal funds. According to the District Hospital Leadership Forum, the sponsor of this bill, this could result in an estimated increase in federal funds in Tulare County of $2.7 million. COMMENTS 1)Rationale . According to the author, this bill is needed to allow a public district hospital to become a LIHP contractor, in counties that do not operate hospitals and are not SB 1081 Page 2 interested in becoming LIHP contractors. 2)Background . California's "Bridge to Reform" Section 1115 federal waiver set up the LIHP, which allows local public entities to access federal matching funds to provide a Medi-Cal-like set of benefits at local option and costs. Currently, 13 counties, as well as a consortium of 34 counties, are operating LIHPs. A number of applications from other eligible entities are pending. Some counties, including Tulare and Santa Barbara, have decided not to pursue a LIHP. LIHPs are designed to provide health care benefits to individuals who will become eligible for Medi-Cal or for subsidized private coverage in 2014. 3)Urgency . This bill states an urgency clause is necessary in order to improve access to health care services for patients in underserved areas at the earliest possible time. LIHPs are only expected to operate through 2013. An urgency bill would allow a hospital to apply to operate a LIHP and potentially begin operation this year. Analysis Prepared by : Lisa Murawski / APPR. / (916) 319-2081