BILL ANALYSIS �
SENATE COMMITTEE ON HEALTH
Senator Ed Hernandez, O.D., Chair
BILL NO: AB 1428
AUTHOR: Conway
AMENDED: June 26, 2013
HEARING DATE: August 21, 2013
CONSULTANT: Bain
SUBJECT : California Health Benefit Exchange: employees and
contractors.
SUMMARY : Requires the California Health Benefit Exchange board
criminal background check requirement for specified employees
and volunteers and vendors to be consistent with a specific
federal Centers for Medicare and Medicaid Services document or
further updates guidance or regulations. Requires fingerprint
images of specified individuals whose duties include access to
any information contained in the information systems and devices
of the California Health Benefit Exchange.
Existing law:
1.Establishes the California Health Benefit Exchange (known as
Covered California) in state government, which is governed by
a board composed of five members. Requires, under federal law,
Covered California to make available qualified health plans to
qualified individuals and qualified employers.
2.Requires Covered California to inform individuals of
eligibility requirements for the Medi-Cal program, the Healthy
Families Program, or any applicable state or local public
program. Requires Covered California to enroll individuals in
any such program, if, through screening of the application,
Covered California determines that such an individual is
eligible.
3.Requires the executive board of Covered California, consistent
with federal guidance applicable to state-based exchanges, to
submit to the Department of Justice (DOJ) fingerprint images
and related information required by DOJ of all employees,
prospective employees, contractors, subcontractors,
volunteers, or vendors, whose duties include or would include
access to confidential information, personal identifying
information, personal health information, federal tax
information, financial information, or any other information
as required by federal law or guidance applicable to
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state-based exchanges for the purposes of obtaining
information on:
a. The existence and content of a record of state
or federal convictions; and,
b. The existence and content of a record of state
or federal arrests for which DOJ establishes that the
person is free on bail or on his or her recognizance
pending trial or appeal.
This bill:
1.Requires fingerprint images for purposes of a criminal
background check of specified individuals whose duties include
access to any information contained in the information systems
and devices of Covered California, instead of existing law,
which requires a criminal background check of individuals
whose duties include or would include access to confidential
information, personal identifying information, personal health
information, federal tax information, financial information,
or any other information as required by federal law or
guidance applicable to state-based exchanges.
2.Deletes an existing reference to "federal guidance applicable
to state-based exchanges" and replaces it with a specific
reference to the federal Centers for Medicare and Medicaid
Services (CMS), Catalog of Minimum Acceptable Risk Standards
for Exchanges (MARS-E), Exchange Reference Architecture
Supplement version 1.0, issued on August 12, 2012, or further
updates, guidance, or regulations.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, negligible state costs.
PRIOR VOTES :
Assembly Health: 18- 0
Assembly Appropriations:17- 0
Assembly Floor: 77- 0
COMMENTS :
1.Author's statement. According to the author, this bill is a
clean-up measure to SB 509 (DeSaulnier and Emmerson), Chapter 10,
Statutes of 2013, that would fix a flaw requiring private health
plan staff to undergo fingerprint and background checks. This bill
is needed to ensure that Covered California complies with the
federal background check guidance, Minimum Acceptable Risk
Standards for Exchanges (MARS-E), without imposing an unnecessary
AB 1428 | Page
3
fingerprint burden on private health plan staff. In addition, this
bill ensures the fingerprint images and related information
submitted to the DOJ will only include that of specified
individuals whose duties include or would include access to any
personal information contained in the information systems and
devices of Covered California.
2.Background. Covered California will be providing coverage to
small employers and individuals, including individuals
eligible for federal health insurance premium and cost-sharing
subsidies. Since some of the individuals applying for coverage
will be applying for coverage subsidies that are means-tested
(for example, federal premium and cost-sharing subsidies for
coverage through Covered California are based on the
individual's income), staff for Covered California will have
access to information about where the individual works,
financial (income, wage data) and personal identifying
information (Social Security Number, name, age, address,
dependents) about individuals seeking coverage.
SB 509 requires the Covered California board to submit to DOJ
fingerprint images and related information of employees,
prospective employees, contractors, subcontractors,
volunteers, or vendors whose duties include or would include
access to specified information for the purposes of obtaining
prescribed criminal history information.
SB 509 was signed into law on June 17, 2013 as an urgency
statute so Covered California could begin hiring call center
employees. As SB 509 moved through the legislative process,
its provisions did not mention the MARS-E but instead
referenced "federal guidance applicable to state-based
exchanges." Covered California's board determined compliance
with the MARS-E was important, but because SB 509's proponents
did not want to delay call center hiring, SB 509 moved forward
with an agreement that clarifying language, including specific
reference to the MARS-E, would follow in this bill.
Covered California indicates the requirement for a fingerprint
check against federal and state arrest and comes from the
federal (MARS-E) Personnel Screening Requirements. MARS-E
requires organizations to screen individuals prior to
authorizing access to information systems, and rescreen
individuals periodically, consistent with the
criticality/sensitivity rating of the position. To meet these
AB 1428 | Page 4
MARS-E requirements, Covered California must perform a
criminal history check for all persons prior to employment
and, require appropriate personnel to obtain and hold a
moderate-risk security clearance as defined in the federal
personnel security/suitability handbook.
3.Prior legislation.
a. SB 900 (Alquist), Chapter 659, Statutes of 2010,
establishes Covered California as an independent public
entity within state government, and requires Covered
California to be governed by a board composed of the
Secretary of California Health and Human Services Agency,
or his or her designee, and four other members appointed by
the Governor and the Legislature who meet specified
criteria.
b. AB 1602 (John A. P�rez), Chapter 655, Statutes of 2010,
specifies the powers and duties of Covered California
relative to determining eligibility for enrollment in
Covered California, and requires Covered Coverage to
arrange for coverage through Qualified Health Plans.
c. AB 2343 (Torres), Chapter 256, Statutes of 2012 requires
that, when state or federal summary criminal history
information is furnished, the authorized agency,
organization, or individual furnish a copy of the
information to the person to whom the information relates
if the information is a basis for an adverse employment,
licensing, or certification decision.
4.Support. The California Association of Health Plans (CAHP)
writes in support that this bill contains important technical
amendments to the recently passed SB 509 (DeSaulnier and
Emmerson) including adding a specific reference to federal law
and limiting the fingerprinting and background check
requirements of that bill to individuals who have access to
the Covered California computer system for eligibility and
enrollment.
5.Drafting issue. This bill is intended to avoid imposing an
unnecessary burden on health plan staff by limiting the
fingerprinting and criminal background check requirements to
individuals who have access to confidential information,
personal identifying information, personal health information,
federal tax information, financial information, or any other
information as required by federal law or guidance applicable
to state-based exchanges. However, as drafted, this bill
broadens the scope of the background check requirement by
AB 1428 | Page
5
requiring individuals with access to "any information"
contained in information systems and devices of Covered
California be subject to the background check requirement.
Staff recommends the author clarify this provision of this
bill.
SUPPORT AND OPPOSITION :
Support: California Association of Health Plans
Oppose: None received.
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