BILL ANALYSIS Ó
SB 1 X1
Page 1
Date of Hearing: June 11, 2013
ASSEMBLY COMMITTEE ON HEALTH
Richard Pan, Chair
SB 1 X1 (Ed Hernandez) - As Amended: June 4, 2013
SENATE VOTE : 24-7
SUBJECT : Medi-Cal: eligibility.
SUMMARY : Enacts statutory changes necessary to implement the
Medicaid (Medi-Cal in California) and the California Children's
Health Insurance (CHIP) coverage expansion, eligibility,
simplified enrollment, and retention provisions of the Patient
Protection and Affordable Care Act of 2010 as amended by the
Health Care and Education Reconciliation Act of 2010 (ACA).
Specifically, this bill :
I. Expands Medi-Cal coverage as follows :
1)Effective January 1, 2014, expands eligibility for Medi-Cal
coverage to adults who are under age 65, not pregnant, and not
otherwise currently eligible for Medi-Cal coverage, up to 133%
of the federal poverty level (FPL) plus a 5% income disregard
and provides full-scope Medi-Cal benefits and as supplemented
under 2) below.
2)Requires the Department of Health Care Services (DHCS) to
obtain approval from the U.S. Secretary of Health and Human
Services (HHS) to establish a benchmark benefit package that
includes the same benefits, services, and coverage that are
provided to all other full-scope Medi-Cal enrollees
supplemented by any benefits, services, and coverage included
in the essential health benefits (EHBs) package adopted by the
state applicable to small and individual group insurance
markets and approved by the Secretary of HHS for the
population eligible for Covered California through the
California Health Benefit Exchange (Exchange) and any
successor EHB package adopted by the state for the expansion
population.
3)Requires the transition of persons currently enrolled in a
Low-Income Health Program (LIHP) under California's Bridge to
Reform Section 1115(b) waiver to the new Medi-Cal expansion
program in accordance with the state transition plan that was
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approved by the federal Centers for Medicare and Medicaid
Services (CMS).
a) Requires a person enrolled in a LIHP to be
simultaneously notified by DHCS, at least 60 days prior to
January 1, 2104, of all of the following:
i) Which health plan includes his or her current
medical home provider;
ii) That the LIHP enrollee will be assigned to a plan
that includes his or her medical home effective January
1, 2014, unless he or she chooses to change plans and no
additional action is required if he or she wants to keep
his or her medical home; and,
iii) If his or her medical home is not contracted with
any of the available Medi-Cal managed care plans (MCPs),
he or she will receive informing materials and if a plan
is not selected within 30 days, he or she will be
automatically assigned to a plan.
b) Requires, in counties where there is no MCP, LIHP
enrollees to be notified that they will be transitioned to
Fee-For-Service (FFS) Medi-Cal as of January 1, 2014,
informed as to whether their LIHP medical home provider is
a Medi-Cal FFS provider, provided instructions on how to
access services, given a list of Medi-Cal FFS providers by
area of practice and with contact information, and provided
any other information required to be sent to new enrollees.
c) Requires DHCS to consult with stakeholders, as
specified, in developing the notices required and notices
to be sent to LIHP enrollees at the time of their 2013
redetermination and again at least 90 days prior to the
transition to ensure that no person loses coverage.
4)Commencing January 1, 2014, provides, to the extent federal
financial participation (FFP) is available, an adolescent who
is in foster care on his or her 18th birthday to be deemed
eligible without interruption and without requiring a new
application, and requires the following:
a) DHCS to develop procedures to identify and enroll
individuals under age 26 who meet the criteria as former
foster care youth, including those who lost coverage as
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result of attaining the age of 21. DHCS to work with
counties to identify and conduct outreach to former foster
care adolescents who lost coverage as result of attaining
the age of 21;
b) DHCS to develop and implement a simplified
redetermination form and require return of the form only if
information known to DHCS is no longer accurate or is
materially incomplete;
c) DHCS to seek federal approval to institute a renewal
process that allows a former foster youth covered under
this section to remain on FFS Medi-Cal after a
redetermination form is returned as undeliverable and the
county is otherwise unable to establish contact, until
contact is reestablished;
d) Termination of eligibility only after a determination
that the individual is no longer eligible and all due
process requirements have been met; and,
e) DHCS to provide Medi-Cal benefits to individuals under
age 26, who were in foster care and enrolled in Medicaid in
any state.
5)Establishes a premium assistance program for legal immigrants
who would otherwise be eligible for Medi-Cal coverage under
the expansion for childless adults, but for the five-year
eligibility limitations and are eligible for advanced premium
tax credit.
a) Requires DHCS to pay the person's insurance premium,
minus the premium tax credit and the cost-sharing expenses,
as specified.
b) Provides for state-only funded benefits if the person is
unable to enroll in the Exchange.
c) Provides that the person is to be eligible for services
that he or she would have been eligible for under the
Medi-Cal program to the extent they are not provided
through the Exchange.
d) Requires DHCS to inform and assist such individuals with
enrolling in coverage in the Exchange, with premium
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assistance, cost-sharing, and benefits in a way that
ensures seamless transition.
II. Effective January 1, 2014, provides pregnancy coverage as
follows :
1)Revises the period of coverage for pregnant women in the
Access for Infants and Mothers (AIM) program from 60 days
after the end of the pregnancy to the end of the month in
which the 60th day occurs, in order to align eligibility with
open enrollment in Covered California.
2)Provides coverage to children born of women in the AIM program
up to age two.
3)Provides that pregnant women who are currently eligible for
pregnancy-related and postpartum services in the Medi-Cal
program are to be eligible for full-scope Medi-Cal services
provided to other eligible adults.
III. Converts income eligibility to a Modified Adjusted Gross
Income (MAGI)-based standard, effective January 1, 2014, as
follows :
1)Requires DHCS to convert existing Medi-Cal, CHIP, and AIM
income eligibility standards to a MAGI-based income
equivalency level for parents of dependent children, caretaker
relatives, children, and pregnant women.
2)Defines caretaker relative as a relative of a dependent child
by blood, adoption, or marriage with whom the child is living,
who assumes primary responsibility for the child's care, and
is one of a specified list of relatives such as parent,
stepparent, grandparent, sibling, cousin, aunt or uncle, or
the spouse or registered domestic partner of one of the listed
relatives.
3)Provides that the maximum eligibility level is not to be less
than the dollar amount that is equivalent to the income level,
expressed as a percent of FPL for each eligibility group, plus
all applicable income disregards, exclusions, and deductions
in effect on March 23, 2010, to ensure that any population
eligible for Medi-Cal, AIM, or the Healthy Families Program
does not lose coverage.
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4)Provides that any individual whose income eligibility is
determined by means of the MAGI-based standard is not to be
subject to a limitation on assets or resources.
5)Repeals the provisions establishing eligibility for the
Section 1931(b) program that sets the maximum income at 100%
FPL, authorizes additional income disregards and deductions,
and requires that Medi-Cal eligibility for these families is
based on establishing "deprivation" of a child, as defined.
6)Applies a standardized 5% income disregard for determining
income eligibility for any individual, whose income
eligibility is determined by means of the MAGI-based standard,
in effect setting the 133% FPL standard at 138%, and sets this
as the minimum income eligibility level.
7)Requires DHCS to adopt procedures that take into account
future changes in income and family size in order to grant or
maintain eligibility for those who may become ineligible or
would be ineligible if the determination was based solely on
the current income and family size at the point at which
eligibility is being determined, as follows:
a) Requires, for currently eligible individuals, financial
eligibility to be based on projected annual household
income for the remainder of the current calendar year if an
income calculation based on the current monthly income
would result in an ineligible income level;
b) Requires, for new applicants, financial eligibility to
be based on projected annual household income and family
size for that year if a determination made solely on
current monthly income and family size would result in a
determination of income ineligibility; and,
c) Requires DHCS to implement a method to account for
reasonably predictable decreases in income and increase in
family size, based on a history of predictable income
fluctuations or other clear indicia of future decrease in
income and increase in family size. Prohibits the
assumption of potential future increases in income or
decreases in family size to make the individual ineligible
in the current month.
8)For purposes of determining eligibility using the MAGI-bases
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standard, requires individuals less than 19 years of age, or
in the case of full-time students, individuals up to age 21 be
included in the household.
IV. Simplifies applications and the redetermination process,
effective January 1, 2014, as follows :
1)Repeals the requirement that adults file mandatory semiannual
status reports regardless of whether there have been any
changes in income, family size, or other factors that affect
continued eligibility for the MAGI-based categories and
eliminates the requirement that a notice of action include the
requirement to file this status report.
2)Codifies and revises existing regulations that define
residency by repealing the requirement that a determination of
residency is not to be granted unless the evidence supports
intent to remain indefinitely. Authorizes new emergency
regulations, and requires that residency is established as
follows:
a) For an individual 21 years of age or older or under 21
years of age who is capable of indicating intent and is
emancipated or married, an attestation that he or she lives
in the state and either intends to reside in the state or
has entered the state with a job commitment or to seek
employment. Specifies that the individual is not required
to have a fixed address or to be currently employed;
b) An individual under 21 years of age who does not qualify
under a) above and is not eligible for Medi-Cal as a foster
child, or by virtue of a linkage to other public programs,
state residency is established if the child lives in the
state, no fixed address is required, or the child resides
with a parent, parents, or caretaker relative who meet the
requirements of a) above; or,
c) For individuals, including those under age 21, who are
incapable of stating intent or who are living in an
institution, requires that the state of residency be
determined by intent to reside, where the parents or
guardians reside, whether they are receiving specified
financial assistance or other applicable circumstances.
3)Revises provisions relating to an individual who maintains a
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residence outside the state for at least two months and is
terminated due to failure to provide required documentation of
continued residence in California and who reapplies, to
require the person to be reinstated upon a showing of
residence in the state and that no permanent residence has
been established in another state, provided other eligibility
criteria are met.
4)Revises, reenacts, and recasts provisions relating to proof of
state residency and requires state residency to be verified
electronically using information from specified state
databases such as the Franchise Tax Board or the Department of
Motor Vehicles. If DHCS is unable to verify state residency
using these sources, residency is to be established as
follows:
a) For an individual 21 years of age or older who is
capable of indicating intent;
i) Specified documentation, such as recent rent or
mortgage receipts; a current California driver's license;
evidence of employment or that the person is seeking
employment in the state; evidence that the person's
children are enrolled in a school in the state; or, a
declaration of intent to reside under penalty of perjury,
but is without a fixed address; and,
ii) A declaration under penalty of perjury that the
person doesn't own or lease a principal residence outside
the state and is not receiving public assistance outside
the state.
b) Further allows specified verification for an individual
over 21 and incapable of stating intent and living in an
institution or is under 21 and living in an institution,
consistent with federal regulations, such as declarations
under penalty of perjury from parents, caretaker relative,
guardians or other specified persons that he or she is a
resident or that the person was a resident at the time of
institutionalization, as appropriate.
c) For an individual under 21 years of age who is capable
of indicating intent and is emancipated or married,
residency is to be established under 4) a) above.
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5)Repeals, reenacts, and recasts provisions relating to the
annual redetermination of eligibility and a redetermination
triggered by a change in circumstances that may affect
eligibility and applies uniform rules to all individuals who
are eligible for Medi-Cal based on MAGI to do the following:
a) Provide that all Medi-Cal enrollees whose eligibility is
MAGI-based are to have their eligibility redetermined every
12 months, unless otherwise provided;
b) Require the county to gather available relevant
information in the beneficiary's file, including but not
limited to files opened or closed in the past 90 days for
Medi-Cal, the CalWorks, or CalFresh, and if based on this
information, the county is able to make a redetermination
of eligibility to do so, notify the individual what
information has been relied on and that if any information
is inaccurate, he/she is required to notify the county, but
is not otherwise required to respond; and, include any
other related information such as if the individual is in a
different Medi-Cal program;
c) In the case of a change of circumstances that requires a
redetermination, but does not affect eligibility, no notice
is to be sent unless otherwise required;
d) In the case of an annual eligibility redetermination, if
the county is unable to determine eligibility pursuant to
a) above, requires the beneficiary to be sent an annual
renewal form that is prepopulated with the information
already available and identifies any additional required
information, inform the person that it must be completed
and returned within 60 days, in person, by mail, (in either
case it must be signed), by telephone, internet, or other
commonly available electronic means, and how to obtain more
information;
i) Requires the county to try to contact the person
during the 60 days to collect information;
ii) If the person has not responded within the 60 days,
the person's eligibility is to be terminated following a
timely notice; or,
iii) If the person responds, but the information is
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insufficient, requires the county to follow current
procedures that apply when a redetermination is triggered
by the receipt of new information by attempting to reach
the person in order to obtain the missing information and
if unsuccessful to send a form that states what
information is still needed, allows the person 20 days to
respond and provides an additional 10 days to obtain the
missing information before termination of eligibility.
e) Requires the renewal form required pursuant to d) above
to be developed in consultation with the counties,
representatives of eligibility workers, and consumers.
f) Revises existing law to allow change of circumstances
information to be provided through any modes of submission
allowed under federal law, including internet, telephone,
mail, in person, and other commonly available electronic
means, including signatures by electronic, telephonic,
and/or hand written transmitted by electronic means, as
authorized by DHCS, and including forms required to be
signed under penalty of perjury.
g) Revises the period in which a person's eligibility may
be reinstated from 30 days to 90 days if the person submits
a signed and completed form or otherwise provides the
needed information.
6)Revises provisions that allow a county to use contact
information received from a person's MCP as part of its
required efforts to maintain the most current contact
information to require the county to attempt to contact the
person to confirm accuracy instead of requiring a consent form
developed by DHCS developed to be on file and authorizes DHCS
to adopt emergency regulations.
7)Requires DHCS to develop prepopulated renewal forms, in
consultation with specified stakeholders, to also be used for
persons whose eligibility is not MAGI-based by January 1,
2015, and allows counties to use existing renewal forms until
then.
8)Clarifies that blindness and disability are to be considered
continuing until a determination is made otherwise, as
specified.
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9)Provides that if a person is found ineligible for Medi-Cal,
after a redetermination, the electronic account is to be
transferred to another insurance affordability program
(Covered California) via secure electronic interface.
10)Requires DHCS to provide assistance to any applicant or
beneficiary, who requests help with an application or with the
redetermination process, requires assistance to be available
in person, over the telephone, and online in a manner that is
accessible to individuals with disabilities or with limited
English proficiency. Requires DHCS to adopt emergency
regulations no later than July 1, 2015, to implement this
provision, deems the first adoption and one readoption an
emergency, and conditions implementation on the availability
of FFP.
V. Establishes eligibility protocols and call center
operations, effective October 1, 2013, as follows :
1)Provides that DHCS is to retain or delegate the authority to
perform Medi-Cal determinations, as specified.
2)Allows DHCS and the Exchange to electronically determine
eligibility for Medi-Cal of an applicant who applies using an
electronic or paper application processed by the California
Healthcare Eligibility, Enrollment, and Retention System
(CalHEERS) and is completed after an assessment and
verification of potential eligibility, using only the
information initially provided online or through the written
application and using the MAGI-based income standard, without
further staff review to verify the accuracy.
3)Except for applications pursuant to 2) above, the county of
residence is to be responsible for determinations and ongoing
case management for the Medi-Cal program.
4)Authorizes the Exchange to provide information regarding the
available MCP selection options to applicants determined
eligible for Medi-Cal based on the MAGI-based income standard;
allows those applicants to choose an MCP; and, authorizes the
recording of the plan selection into CalHEERS for reporting to
DHCS.
5)Authorizes implementation by all-county or all-plan letters or
other similar instructions in lieu of taking regulatory
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action, requires reports to the Legislature, conditions
implementation on federal approval and provides that it is to
be effective from October 1, 2013 until July 1, 2015.
6)Requires a workflow transfer protocol to be established so
that persons who call the customer center operated by the
Exchange to apply for an insurance affordability program are
only asked those questions essential to reliably ascertain
potential eligibility for Medi-Cal and to determine an
appropriate point of referral. Requires after the transfer
workflow process:
a) If it appears that one or more members of the household
are eligible for Medi-Cal on a MAGI-based income standard,
the Exchange refer the person to the county of residence or
other county resource for completion of the application
and, subject to income limitations, review, and approval of
DHCS, also refer the caller if the household appears to
include someone who is pregnant, potentially disabled, over
age 65, or in need of long-term care services;
b) The county to proceed with the assessment and perform
any required eligibility determinations and the Exchange to
transmit all information relative to the application to the
county of residence or other appropriate county resource
via secure electronic interface without undue delay;
c) If the Exchange determines that the household appears to
include only individual(s) not potentially eligible for
Medi-Cal benefits, the Exchange is to proceed with the
eligibility determination; and,
d) Begin coverage immediately upon determination if it
subsequently turns out that a member of the household is
eligible for Medi-Cal using MAGI-based income standard,
with the county of residence responsible for final
confirmation.
7)Unless otherwise provided, establishes the county of residence
as responsible for eligibility determinations and ongoing case
management for the Medi-Cal program.
8)Requires DHCS, the Exchange, and each county consortia to
enter into an interagency agreement specifying operational
parameters and performance standards, in consultation with
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specified interested stakeholders and requires, prior to
October 1, 2014, DHCS to review, in consultation with
specified stakeholders, the efficacy of the enrollment
procedures established by this bill.
9)Provides, only during the initial open enrollment period
established by the Exchange and in no event after June 30,
2014, if after applying the transfer protocol, the Exchange
determines that the household is a mixed household of persons
potentially eligible for MAGI-based Medi-Cal and those who are
potentially ineligible for Medi-Cal, a process for an initial
determination of the Med-Cal eligibility and a final
confirmation by the county of residence, which is to send out
notices without imposing any additional burdens on the
applicant.
VI. Includes general provisions as follows :
1)Makes legislative findings and declarations that the U.S. is
the only industrialized country without a universal health
insurance system; that 46 million Americans under age 65 do
not have health insurance; that 7.1 million nonelderly
Californian's were uninsured in 2009, amounting to 21.1% of
nonelderly and up nearly 2% from 2007; that the ACA was signed
into law on March 23, 2010, is the culmination of decades of
movement towards health care reform, and is the most
fundamental legislative transformation of the U.S. health care
system in 40 years; and, that as a result of enactment between
89% and 92% of Californians under 65 years of age will have
health coverage and between 1.2 and 1.6 million individuals
will be newly enrolled in Medi-Cal. States it is the intent
of the Legislature to ensure full implementation of the ACA,
including the Medi-Cal expansion for individuals with incomes
below 133% of the FPL, so that millions of uninsured
Californians can receive health care coverage.
2)Requires DHCS, in collaboration with the Exchange, the
counties, consumer advocates, and the Statewide Automated
Welfare System consortia, to develop and prepare one or more
reports that are issued at least quarterly and are made
publicly available within 30 days following the end of each
quarter, for the purpose of informing the California Health
and Human Services Agency (CHHSA), the Exchange, the
Legislature, and the public about the enrollment process for
all insurance affordability programs.
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3)Revises current law to require, instead of authorize, all
insurance affordability programs, to accept self-attestation,
instead of requiring production of documentation for age, date
of birth, family size, household income, state residency,
pregnancy, and any other applicable criteria permitted under
the ACA.
4)Authorizes an individual applying for an insurance
affordability program to be accompanied, assisted, and
represented in the application and renewal process by
individuals or organizations of his or her choice. Provides
that that specified persons may apply or renew on behalf of an
individual who is unable to apply or renew on their own
behalf. Authorizes a person who wishes to challenge an
eligibility decision to be represented by herself, himself,
legal counsel, or other specified spokespersons of his or her
choice, provides that this section is effective October 1,
2013, and may be implemented by emergency regulations.
5)Specifies, in furtherance of the intent of the Legislature to
protect individual privacy and the integrity of the Medi-Cal
program and other insurance affordability programs by
restricting the disclosure of personal identifying information
to prevent theft, fraud, and abuse where an applicant or
enrollee appoints an authorized representative (AR), the
following is to be effective October 1, 2013, or when all
necessary federal approvals have been obtained:
a) DHCS, in consultation with the Exchange, is to implement
policies and prescribe forms, notices, and other safeguards
and to adopt emergency regulations, as specified;
b) A requirement for an AR to be effective, a completed
authorization form must be obtained electronically,
telephonically or handwritten, with authorization to
specify the scope of the authority, what notices are to be
sent to the AR, and that it is effective until canceled or
modified, or the AR is otherwise replaced;
c) Requires that an AR can be canceled or modified at any
time for any reason by the program or the enrollee;
d) The definition of AR and other relevant terms;
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e) A requirement that employees or contractors of providers
so disclose this relationship;
f) Authorizations for an AR at state fair hearings, even if
one has not been designated under these provisions; and,
g) Authorizes providers, staff members, or volunteers of
organizations to be an AR, as long as there is a signed
written agreement to adhere to specified federal
requirements and a determination that the AR is acting in
the person's best interest.
EXISTING LAW :
1)Establishes, under state and federal law, the Medicaid program
(Medi-Cal in California) as a joint federal and state program
offering a variety of health and long-term services to
low-income women and children, low-income residents of
long-term care facilities, seniors, and people with
disabilities.
2)Establishes, under federal law, CHIP to provide health
coverage to children in families that are low-income, but with
incomes too high to qualify for Medicaid.
3)Provides under state and pre-ACA federal law that in order to
qualify for full-scope Medi-Cal without a share of cost, a
pregnant woman must have family income below 100% of the FPL,
have assets below the allowable level, meet qualifying
immigration status requirements, and must either have another
dependent child in the home or be in the third trimester.
4)Provides pregnancy-related services to women with family
income below 200% FPL, defined as services required to assure
the health of the pregnant woman and the fetus. There is no
share of cost and no assets limits for this program.
5)Establishes the AIM program to provide prenatal care, labor,
and delivery coverage for pregnant women with family income
between 200% and 300% of the FPL and for children less than
two years of age who were born of a pregnancy covered under
AIM.
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6)Provides that citizen and legal immigrant children in foster
care are eligible for full scope Medi-Cal benefits regardless
of income or assets and upon attaining age 18, remain eligible
for full-scope, no share of cost Medi-Cal with no income or
assets requirements as former foster care children until age
21.
7)Establishes a process for the redetermination of an
individual's eligibility for Medi-Cal annually, and whenever
the county receives notice of a change in circumstances that
may affect eligibility.
8)Effective January 1, 2014, requires an individual to have the
option to apply for state subsidy programs, which includes the
state Medicaid program, the state CHIP, enrollment in a
qualified health plan (QHP) through a state exchange and a
Basic Health Plan, if there is one, either in person, by mail,
online, by telephone, or other commonly available electronic
means.
9)Effective January 1, 2014, requires development of a single,
accessible, standardized application for the state subsidy
programs to be used by all eligibility entities and
establishes a process for developing and testing the
application.
10)Creates the Exchange, as an independent state entity governed
by a five-member Board, to be a marketplace for Californians
to purchase affordable, quality health care coverage, claim
available tax credits and cost-sharing subsidies, and one way
to meet the personal responsibility requirements of the ACA.
FISCAL EFFECT : According to the Senate Appropriations
Committee:
1)The Mandatory Expansion . By simplifying the process for
determining eligibility for Medi-Cal and enrolling program
participants, this bill will increase enrollment in the
program. The Legislative Analyst's Office (LAO) projects that
the total costs due to increased enrollment of people already
eligible for the program will be about $620 million in 2014-15
($290 million General Fund (GF) at traditional cost sharing),
rising to about $1.1 billion in 2020-21 ($460 million GF).
Note that these costs will occur due to changes mandated by
federal law.
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2)The Optional Expansion . By expanding Medi-Cal eligibility to
all childless adults under age 65 with household income below
138% of FPL, this bill substantially increases the eligible
population, increasing program costs. Under the ACA, FFP will
be substantially higher than current practice-starting at 100%
and declining to 90% by 2020 and thereafter.
a) State Medi-Cal health care costs . The LAO projects
that, under reasonable assumptions, about 1.8 million
additional people will be eligible for Medi-Cal under this
bill and that about 65% of eligible persons will enroll in
the program. In 2014-15, total projected costs for medical
services under the optional expansion are projected to be
about $3.5 billion per year, entirely funded by the federal
government. In 2020-21, the total costs for medical
services under the optional expansion are projected to be
$6 billion per year, including about $605 million per year
in GF costs (based on the ultimate 90% federal matching
rate for the optional expansion population).
b) State Medi-Cal administrative costs . In addition to the
direct costs to provide medical services to the expansion
population, there will be administrative costs to make
eligibility determinations and enroll beneficiaries in
Medi-Cal. Due to the changes to eligibility and enrollment
processes under this bill, per capita administrative costs
associated with the expansion population may be lower than
current per capita administrative costs. Administrative
costs are subject to the standard 50% federal matching
rate. By 2020-21, state GF administrative costs are likely
to be in the low tens of millions per year.
c) State savings in other health care programs and in
corrections . The LAO also indicates that the state will
see substantial savings in other state health-subsidy
programs, such as the Genetically Handicapped Persons
Program, the Breast and Cervical Cancer Treatment Program,
and other programs. As Medi-Cal eligibility increases,
some participants in these state programs will be eligible
for full scope health benefits from Medi-Cal and may no
longer need services from these specialized programs.
There is a good deal of uncertainty about the impact of the
Medi-Cal expansion on these programs, but the LAO indicates
that state savings could be in the low hundreds of millions
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per year. In addition, the state could experience GF
savings up to $60 million per year due to the shift of
certain outpatient medical costs for inmates to Medi-Cal
under the expansion.
d) County health care savings . Under current law, county
governments are responsible for providing certain health
care services to medically indigent adults who do not
qualify for other public health care programs. Under the
proposed expansion of Medi-Cal, a portion of that
population would transition from county responsibility to
the Medi-Cal program. While there is a great deal of
uncertainty regarding how many people would transition from
county-provided health care coverage to Medi-Cal and the
cost savings to the counties, the LAO indicates that the
counties are likely to realize cost savings in the range of
$800 million to $1.2 billion per year. It is important to
note that under this bill, all county savings would be
retained by the counties and would not be shared with the
state.
3)Policies that will impact enrollment and costs . In addition
to the general uncertainty in projecting future Medi-Cal
enrollment levels and health care costs, there are certain
policy issues addressed by this bill that are likely to have
impacts on enrollment levels or per capita costs. The fiscal
impacts of these policy choices are not fully known at this
time. Key policy choices made in this bill include:
a) The benefit package provided to the expansion
population. Federal law provides some flexibility to the
state to design a benefit package for the expansion
population (although the benefit package must provide the
EHBs required under the ACA).
This bill requires DHCS to seek federal approval to provide
the same benefit package to the expansion population as is
provided under the current Medi-Cal population, as well as
providing coverage required under the EHB package. In
addition, this bill requires the existing Medi-Cal
population to also receive the same essential health
benefit benchmark coverage. In general, the existing
Medi-Cal benefit package is broader than the EHB benchmark
plan the state has selected (the Kaiser Small Group plan),
particularly in coverage of long-term services and
supports. However, the Kaiser plan provides some
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additional benefits such as some acupuncture services and
more generous substance abuse benefits.
The fiscal projections above assume that the expansion
population receives the existing Medi-Cal benefit package.
There may be additional costs, for both the existing
Medi-Cal eligible population and the expansion population,
by requiring both populations to receive benefits
equivalent to the Kaiser benchmark plan.
b) Self-attestation by applicants . Federal law and
regulations allow states to accept self-attestation by
applicants of certain information, such as age, date of
birth, household income, and state residency (not
immigration status). This bill requires DHCS to accept
self-attestation of this information. By allowing
applicants to self-attest (rather than requiring them to
provide documentation) this provision simplifies the
application process and is likely to increase enrollment.
c) Full scope pregnancy-related coverage . Under current
state law, pregnant women with incomes up to 200% of FPL
are eligible for Medi-Cal. Some of these beneficiaries are
eligible for full-scope benefits during pregnancy, while
other beneficiaries are only entitled to pregnancy-related
benefits, depending on a variety of eligibility factors.
Draft federal regulations indicate that Medicaid programs
must provide full scope benefits to pregnant women, unless
the federal government specifically authorizes states to
limit such benefits. This bill requires that all pregnant
women enrolled in Medi-Cal (up to 200% of FPL) are to be
provided with full scope benefits, unless approval is
granted by the federal government to provide lesser
benefits. (The author indicates that the intent of this
bill is to require full-scope benefits to be provided to
all pregnant women enrolled in Medi-Cal.)
d) Elimination of the existing deprivation requirement .
Under current state law, the Medi-Cal program covers
children and caretaker relatives who are "deprived" of full
parental support (i.e. one parent is absent, deceased,
disabled, unemployed, or underemployed). Federal law allows
states to eliminate this requirement and this bill does so.
It is not clear whether eliminating this requirement would
actually increase the number of eligible individuals for
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the program.
e) Projection of annual income . Federal guidance to date
indicates that projected annual income (rather than an
applicant's current monthly income) can be used to
determine income eligibility. This bill requires DHCS to
allow applicants to use projected annual income to
determine income eligibility. The counties (who currently
perform eligibility determinations) have indicated that
they already allow some projection of income when making
eligibility determinations, so it is not clear whether this
would actually increase overall enrollment in Medi-Cal.
COMMENTS :
1)PURPOSE OF THIS BILL . On January 24, 2013, Governor Brown
issued a proclamation to convene the Legislature in
Extraordinary Session to consider and act upon legislation
necessary to implement the ACA in: a) the areas of
California's private health insurance market, rules and
regulations governing the individual and small group market;
b) California's Medi-Cal program and changes necessary to
implement federal law; and, c) options that allow low-cost
health coverage through Covered California, California's
Exchange, to be provided to individuals who have income up to
200% of the FPL. This bill, along with AB 1 X1 (John A.
Perez), address the second of the three areas identified in
the Governor's proclamation, that is to adopt the provisions
of the ACA related to changes in Medi-Cal.
Specifically, this bill adopts the state option of expanding
Medi-Cal coverage to non-disabled citizens and qualified
resident childless adults, between the ages of 19 and 65 who
are not currently eligible for other full-scope Medi-Cal
programs and provides a full scope benefit package, as
allowable under federal law. This category is limited to
those with income under 138% of the FPL and the person must
meet other citizenship and immigration status requirements.
This bill also enacts the ACA requirement that the state
Medicaid program extend coverage to former foster youth until
age 26, without regard to income or assets. The ACA
establishes a new simplified income standard for families,
children, and the new expansion population based on the
MAGI-standard as defined under the Internal Revenue Code
(IRC). It does not apply to seniors or person with
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disabilities. This bill includes provisions necessary to
convert to the new MAGI methodology and income standard.
Finally this bill includes a number of provisions that
implement the goal of the ACA, reducing the number of
uninsured by streamlining and simplifying eligibility
determinations and increasing reliance on electronically
available data.
The author puts forth a number of policy and fiscal reasons in
support of the adoption of state options as would be enacted
by this bill. For instance, the expansion of Medi-Cal
coverage for adults not currently eligible would improve the
health status of the newly eligible Medi-Cal recipients;
provide significantly enhanced federal funding for California;
provide enhanced funding for safety-net health care providers
to serve the 3.1 to 4 million remaining uninsured; reduce
health care providers' uncompensated care costs; and, prevent
lower income individuals from being without access to
affordable health care coverage when higher income individuals
have access to tax credits that reduce premium and
cost-sharing costs in Covered California.
2)BACKGROUND . Starting in calendar year 2014, the ACA replaces
many of the complex categorical groupings and limitations in
the Medicaid program and provides eligibility to all
nondisabled, non-pregnant individuals between the ages of 19
and 65 with family income at or below 133% FPL, provided that
the individual meets certain non-financial eligibility
criteria, such as citizenship. Also beginning in 2014, the
ACA requires MAGI to be used in determining eligibility for
this new Medi-Cal population, as well as for families,
children, and caretaker relatives and for subsidized coverage
through Covered California. The MAGI is based on the federal
IRC. The ACA generally adopts MAGI as a way to count
household income and eliminates the existing variety of income
disregards and deductions currently used by states. In
addition, there are no resource or assets limits under MAGI.
Using MAGI methods, household income will be the sum of the
income of every individual who is in the household, minus a
standard income disregard of five percentage points of the FPL
for the applicable household size. The MAGI rule also aligns
family size under Medicaid rules with the IRC's MAGI
definition. As a result, there are a small number of
situations in which the transition from current rules to MAGI
rules will result in different household compositions than
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under the old rules.
According to a model of California insurance markets known as
the California Simulation of Insurance Markets, 5.6 million
Californians were without health insurance in 2012 or 16% of
the population under age 65. A recent study estimates that
when California implements the Medi-Cal provisions, more than
1.4 million of these individuals will be newly eligible, of
which between 750,000 and 910,000 are expected to be enrolled
at any point in time by 2019. This study, "Medi-Cal Expansion
under the Affordable Care Act: Significant Increase in
Coverage with Minimal Cost to the State," published by UC
Berkeley Center for Labor Research and Education and UCLA
Center for Health Policy Research in January 2013, also finds
that about 2.5 million Californians are already eligible for
Medi-Cal but not enrolled, and between 240,000 and 510,000 of
them are expected to be enrolled at any point in time by 2019
as a result of implementing the ACA.
3)Transition to MAGI . Effective January 1, 2014, states will
use the MAGI-based methodology for determining the income of
an individual and the individual's household, as applicable,
for purposes of eligibility for Medicaid or CHIP where a
determination of income is required. Pursuant to the ACA, CMS
issued regulations that consolidated eligibility groups
currently included in multiple statutory provisions into three
simplified groups and established a new group for the
low-income adult expansion group. The consolidated groups
are: a) Parents and Other Caretaker Relatives; b) Pregnant
Women; and, c) Children under 19. According to CMS, to
promote coordination and avoid gaps or overlaps in coverage,
the new methodology is aligned with the one that will be used
to determine eligibility for the premium tax credits and cost
sharing reductions available to certain individuals purchasing
coverage on the Exchanges starting in 2014. Under the ACA,
MAGI-based income methodologies will not apply to
determinations of Medicaid eligibility for elderly and
disabled populations. As interpreted by CMS regulations, the
new MAGI-based methodology includes certain unique income
counting and household composition rules.
Currently, states' methodologies for determining Medicaid and
CHIP income eligibility vary widely, primarily due to
differences in the application of income disregards. To
determine eligibility, the state first determines an
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individual's (or family's) gross income using a combination of
state and federal rules on household or family composition,
and then applies deductions, or disregards, which are income
amounts that are not considered countable, such as childcare
expenses. These income deductions or disregards can vary by
state, type of income, and by eligibility group. The
resulting net income is then compared to an income eligibility
threshold (referred to as the net income standard), expressed
as a percentage of the FPL to determine whether the individual
is income-eligible for Medicaid or CHIP. By converting to the
MAGI rules and collapsing most existing eligibility into three
broad categories, this methodology has an impact on how
household income is counted. For example, a stepparent with
no financial obligation for a child is not counted in the
household income under existing rules, but may be under MAGI.
States are required to apply conversion methodologies for two
purposes. One is for the purpose of determining the state's
applicable Federal Medical Assistance Percentages for each
population, including for newly eligible individuals. The
second is the conversion of net income standards under
existing programs in order to implement the simplified
MAGI-based equivalent eligibility income level, under which
the minimum eligibility level will be set at 138% FPL for
children, parents, and caretaker relatives, and the highest
will be based on eligibility standards in effect on March 23,
2010, or December 31, 2013. CMS has two options for states,
either a standardized methodology developed by CMS or a state
may propose an alternative and demonstrate to CMS how it meets
the statutory objectives.
In order to test various methodologies, CMS consulted with
states and selected 10 pilot states to test the feasibility of
potential conversion methodologies. CMS developed a national
model to simulate Medicaid eligibility for use in the
recommended standardized MAGI conversion methodology using a
data set known as Survey of Income and Program Participation
(SIPP). States that choose this methodology may use the SIPP
data or state data. CMS is calculating this for each state.
The second option is for a state to propose an alternative
method because of unusual income disregards or income
standards. These states must do their own calculations and
seek approval from CMS.
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States were required to review the CMS converted MAGI-based
standards during April and make corrections by May 31, 2013.
States using their own data are required to submit a MAGI
conversion plan no later than April 30, 2013, and are supposed
to be notified of approval or disapproval by June 15, 2013.
DHCS has declined to make the CMS conversion information
public.
4) ENROLLMENT AND SIMPLIFICATION . Effective January 1,
2014, the ACA envisions a streamlined, simplified, and
seamless enrollment system that employs minimal use of
paper documentation and relies on modern technology to the
greatest extent possible for all the state subsidy
programs. For example, CMS states in the Preamble to the
March 23, 2012 Rules and Regulations, as follows: whether
conducted by a public or private entity, it is anticipated
that eligibility determinations using MAGI-based standards
will be highly automated, utilizing business rules
developed by the State Medicaid agency. In the most
simplified cases, which can be determined without human
intervention or discretion, we are clarifying that
automated systems can generate Medicaid eligibility
determinations, without suspending the case and waiting for
an eligibility worker to finalize the determinations.
Except for certain specified information such as citizenship
and immigration status, the CMS Regulations allow states to
accept attestation of needed information. CMS further
states that this applies to both financial and
non-financial verification and that if self-attestation is
not accepted, states must access available electronic
databases prior to requiring additional information or
documentation in verifying all factors of eligibility.
With regard to forms, the HHS Secretary is required to
develop a single streamlined application. A state may
develop its own single, streamlined form, but it must be
approved by the HHS Secretary and meet the HHS
Secretary-established standards. The ACA also requires
that an individual determined to be ineligible for the
Medicaid program or the state's CHIP program is to be
screened for eligibility for enrollment in the Exchange and
if applicable, premium assistance without being required to
submit an additional or separate application. Supplemental
forms may only be required for individuals whose
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eligibility cannot be determined through the application of
the MAGI standard. States are required to establish
procedures that enable individuals to enroll and renew
through an Internet website and to consent to enrollment or
reenrollment through an electronic signature. States are
also required to ensure that the Medicaid program, the CHIP
program, and the Exchange utilize a secure electronic
interface sufficient to allow for a determination of
eligibility for coverage or enrollment, as appropriate.
CMS has directed states to analyze current verification
procedures to determine the policy and systems
modifications that will be needed in order for the state to
achieve this streamlined verification process. There are a
number of key steps that California has already undertaken,
but in other cases new systems or revisions to existing
processes will be necessary to ensure that the spirit and
intent of the ACA are carried out.
a) AB 1296 (Bonilla), Chapter 641, Statutes of 2011 . AB
1296 codified many of the requirements of the ACA with
regard to a streamlined, simplified, and coordinated
eligibility system. For instance it selected the option
for a state developed single application over the option of
using one developed by the HHS Secretary. AB 1296
established a stakeholder process as a forum to review and
discuss many of the options and implementation issues and
challenges that are created by the ACA with regard to these
issues. AB 1296 further advanced the intent of the ACA by
requiring that only the information necessary for the
eligibility determination could be required and only from
the person who was applying for coverage. AB 1296 also
required that forms be in simple user-friendly language,
and accessible to limited English proficient applicants, as
well as others requiring accommodations for accessibility.
AB 1296 laid out a process for streamlining the application
and enrollment process by requiring the entity that made
the eligibility determination to grant eligibility
immediately, to allow prepopulation of forms using
information from available data sources and a simplified
process for verification, and an opportunity for the
applicant to correct information, resolve discrepancies, or
to supply additional information as necessary.
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b) CalHEERS Project . CalHEERS is a procurement conducted
jointly by the Exchange, DHCS, and Managed Risk Medical
Insurance Board to build the Information Technology system
to support the consumer application and enrollment process
at the Exchange. Following extensive review and
stakeholder comment and input, Accenture was hired through
a solicitation process for the design, development, and
deployment of CalHEERS. The portal will offer eligibility
determinations for both Medi-Cal and federally subsidized
Covered California coverage through the Exchange. It will
allow enrollment through multiple access points including
mail, phone, and in-person applications. It is guided by a
"no wrong door" policy that is intended to ensure the
maximum number of Californians obtain coverage appropriate
to their needs. Eligibility and enrollment functions will
be released in September of 2013. The CalHEERS business
functions include interfacing with the Medi-Cal eligibility
data system. It will also have the capacity to be a secure
interface with federal and state databases in order to
obtain and verify information necessary to determine
eligibility.
c) MAGI-based eligibility verification . Although states
are allowed to accept self-attestation of the individual's
information for all factors of eligibility (except
citizenship and immigrations status), CalHEERS is only
currently being programmed to accept it for the Exchange
and not for Medi-Cal eligibility. To the extent that
information related to Medicaid or CHIP eligibility is
available through an electronic data services hub
established by the Secretary of HHS, states must use it to
do so. Federal regulations detail other sources that
should be used to verify wages and earnings such as the
Internal Revenue Service, agencies that administer state
unemployment compensation laws, and information related to
eligibility or enrollment from the Supplemental Nutrition
Assistance Program (SNAP). If information provided on the
application or renewal form is reasonably compatible with
information obtained through these data sources,
eligibility is required to be determined without requesting
any additional information from the individual. Income
information is considered reasonably compatible if both are
above, at, or below the applicable income threshold. If
the information is not reasonably compatible, states have
the option to obtain a statement for the person which
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reasonably explains the discrepancy or provide a reasonable
amount of time for the person to produce documentation or
other information. When relying on paper documentation,
states are required to consider the administrative costs
associated with establishing and using data sources as
compared with the administrative costs of relying on paper.
d) Income Fluctuations . Under the ACA, Medicaid
eligibility remains based on monthly income at the time of
application, while eligibility for premium tax credits for
Exchange coverage is based on annual income. However, the
CMS guidance has been interpreted to provide states new
options to assess continuing Medicaid eligibility based on
projected annual income or by taking into account
anticipated changes in income, which would minimize
coverage gaps and transitions between Medicaid and Exchange
coverage due to small income fluctuations. Actual changes
in income must be reported by applicants and enrollees and
acted upon by the state or designated entity.
5) Renewal and redetermination . The ACA goal of reducing
the number of uninsured by creating continuum of coverage
options for individuals with family incomes up to 400% FPL
and the increased reliance on electronically available data
has implications for how states process renewals and
redeterminations. For instance, unless the individual
provides information regarding a change in circumstances,
renewal for individuals whose eligibility is based on MAGI
can be no more frequently than once every 12 months. Since
the individual is obligated to report changes in
circumstances, this requires the elimination of semiannual
reporting for adults in California. The state agency must
have procedures in place to ensure that beneficiaries make
timely and accurate reports of any change in circumstances
and that enable beneficiaries to report these changes
online, by phone, in person, or through other electronic
means. For non-MAGI groups, such as those who are blind or
disabled, the rule retains the existing provision that
eligibility be re-determined at least every 12 months, but
allows states to assume that blindness and disability
continue until there is a determination otherwise.
For MAGI groups, state agencies will first seek to renew
eligibility by evaluating information from the individual's
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electronic account or from other more current reliable data
sources. If the available information is sufficient to
determine continued Medicaid eligibility, the state is
required to renew coverage based on that information and
send an appropriate notice without requiring the individual
to sign and return the notice. Enrollees must correct any
inaccurate information in the notice online, in person, by
telephone, or by mail. If it cannot be determined that the
individual remains eligible based on available information,
the individual must be provided with a pre-populated form
containing the information relevant to renewal that is
available to the agency and a reasonable period of time of
at least 30 days to provide the necessary information and
correct any inaccuracies online, in person, by telephone,
or by mail. The state has the option to allow
self-attestation and then use information available through
electronic data sources for verification. The state cannot
require an in-person interview as part of the
redetermination process. AB 1296 adopted many of these
requirements and this bill makes additional conforming
changes.
This bill also implements the provisions that are designed to
reduce multiple unnecessary applications by allowing a
reconsideration period for individuals who are terminated
due to failure to submit a renewal form or information. In
such a case, if the individual subsequently submits within
90 days after the date of termination, the state is
required to redetermine the individual's eligibility
without requiring a new application.
6)SUPPORT . Supporters, such as Western Center on Law and
Poverty (Western Center), state that this bill is truly a
historic piece of legislation which will transform the
Medi-Cal program by covering all low-income Californians and
modernizing and simplifying the eligibility rules to realize
the "no wrong door visions" of the ACA. According to Western
Center, many complain that Medi-Cal administration and
eligibility determinations are too cumbersome and complicated
and states in support that this bill would achieve a more
modern, efficient, and streamlined program, as well as align
the Medi-Cal rules with the rules in the Exchange. Western
Center also points out in support that this bill provides the
same scope of benefits to the adult expansion population as to
the existing population and also adds the 10 categories of
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EHBs. The County Welfare Directors Association of California
(CWDA) also in support states that this bill moves California
closer to the promise of affordable, accessible coverage by
implementing a new federal income standard based on tax
filings, eliminating the asset test for parents, children, and
the newly eligible population, eliminating mid-year status
reports, and providing a structure for those enrolled in LIHPs
to transition seamlessly into ongoing Medi-Cal coverage. CWDA
points out in support, that many of these simplifications have
been long sought by county human services departments and that
reducing the burden for clients and the amount of time county
staff must spend, as well as increasing the use of information
electronically will help ensure quick and accurate eligibility
determinations. The California Labor Federation states that
this bill will enact a central component of the ACA to
complement the establishment of the state Exchange by
expanding Medi-Cal to ensure that the lowest-income
Californians have access to subsidized coverage. The
California Labor Federation further argues in support that not
only will individuals and families benefit, but the expansion
has the possibility of improving public health by increasing
access to preventive care and reducing the use of emergency
rooms and charity care. These supporters and others also
point to the fact that this bill will bring in an estimated
$2.1 to $3.5 billion in federal funds due to the 100% federal
funding for the newly eligible. Health Access California,
also in support, points to an analysis conducted by the
University of California that found that most of the costs
associated with the Medi-Cal expansion and program changes
would be off-set by increased GF revenues and other savings.
Californians for Safety and Justice write in support that this
bill will have a positive impact on the justice system and
reduce the likelihood of recidivism. These supporters point
to data to show that the high rate of chronic medical
conditions, mental illness, and substance abuse prevalent in
jail and prison populations and left unaddressed contributes
to the cycle of crime, making those with low rates of health
insurance more likely to be repeat offenders.
Other supporters such as the California Pan-Ethnic Health
Network, the California Black Health Network (CBHN), the
Greenling Institute, and the National Health Law Program also
support this bill because of the scope of benefits it provides
to the expansion population, to pregnant women, and to former
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foster youth up to age 26. These supporters also point out
that over 60% of the newly eligible are people of color and
over one third have limited English proficiency, therefore
this bill will improve health outcomes for the lowest-income
residents, including communities of color. In addition, CBHN
points to the stubbornly high rate of maternal mortality and
infant mortality rates of African American women and their
infants and the hope that this comprehensive coverage will
address these disparities.
7)RELATED LEGISLATION .
a) AB 1 X1 is substantially similar to this bill. AB 1 X1
is pending in the Senate Health Committee.
b) AB 2 X1 (Pan), Chapter 1, Statutes of 2013-14 First
Extraordinary Session, establishes health insurance market
reforms contained in the ACA specific to individual
purchasers, such as prohibiting insurers from denying
coverage based on preexisting conditions; and, makes
conforming changes to small employer health insurance laws
resulting from final federal regulations.
c) SB 2 X1 (Ed Hernandez) Chapter 2 of 2013-14 First
Extraordinary Session, applies the individual insurance
market reforms of the ACA to health care service plans
(health plans) regulated by the Department of Managed
Health Care and updates the small group market laws for
health plans to be consistent with final federal
regulations.
d) SB 3 X1 (Ed Hernandez), establishes a bridge plan option
that allows low-cost health care coverage to be provided to
individuals within the Exchange. SB 3 X1 is pending in the
Assembly Health Committee.
e) SB 28 (Ed Hernandez and Steinberg) implements various
provisions of the ACA regarding Medi-Cal eligibility and
program simplification including the use of the MAGI and
expansion of eligibility in the Medi-Cal program. SB 28 is
pending in the Assembly Health Committee.
f) AB 50 (Pan) implements various provisions of the ACA
related to allowing hospitals to make a preliminary
determination of Medi-Cal eligibility, allows forms for
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renewal to be prepopulated with existing available
information and requires the process for Medi-Cal enrollees
to choose a plan to be coordinated with the Exchange. AB
50 is pending in the Senate Health Committee.
8)PREVIOUS LEGISLATION .
a) AB 43 (Monning) of the 2011-12 Session would have
expanded Medi-Cal coverage to persons with income that does
not exceed 133% FPL, effective January 1, 2014 and would
have required a transition plan for persons enrolled in a
LIHP. AB 43 died on the Senate Inactive File.
b) SB 677 (Ed Hernandez) of the 2011-12 Session would have
required DHCS to implement the provisions of the ACA
relating to eligibility and benefits in the Medi-Cal
program. SB 677 died on the Assembly Inactive File.
c) SB 1487 (Ed Hernandez) of the 2011-2012 Session would
have required DHCS to extend Medi-Cal eligibility to youth
who were formerly in foster care and who are under 26 years
of age, subject to FFP being available, and to the extent
required by federal law. SB 1487 would have also made
legislative findings and declarations regarding the ACA,
stated legislative intent to ensure full implementation of
the ACA, and to enact into state law any provision of the
ACA that may be struck down by the U.S. Supreme Court. SB
1487 was held on the Senate Appropriations Committee
Suspense file.
d) AB 1066 (John A. Pérez), Chapter 86, Statutes of 2011,
enacts technical and conforming statutory changes necessary
to conform to the Special Terms and Conditions required by
CMS in the approval of the Bridge to Reform Demonstration,
including changing the name of the LIHP from Coverage
Expansion and Enrollment Projects to the Medi-Cal Coverage
Expansion and Health Care Coverage Initiative.
e) AB 342 (John A. Pérez), Chapter 723, Statutes of 2010,
enacted the LIHP and Coverage Expansion and Enrollment
Projects to provide health care benefits to uninsured
adults up to 200% of the FPL, at county option through a
Medi-Cal waiver demonstration project.
f) AB 1296, the Health Care Eligibility, Enrollment, and
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Retention Act, requires CHHSA, in consultation with other
state departments and stakeholders, to undertake a planning
process to develop plans and procedures regarding these
provisions relating to enrollment in state health programs
and federal law. AB 1296 also requires that an individual
would have the option to apply for state health programs
through a variety of means.
g) AB 1595 (Jones) of 2010 would have required DHCS to
expand Medi-Cal eligibility to individuals with family
income up to 133% of FPL without regard to family status by
January 1, 2014. AB 1595 died on Suspense in the Assembly
Appropriations Committee.
h) AB 1602 (John A. Pérez), Chapter 655, Statutes of 2010,
establishes the Exchange as an independent public entity to
purchase health insurance on behalf of Californians with
incomes of between 100% and 400% FPL and employees of small
businesses. Clarifies the powers and duties of the Board
governing the Exchange relative to the administration of
the Exchange, determining eligibility and enrollment in the
Exchange, and arranging for coverage under qualified
carriers.
i) SB 900 (Alquist), Chapter 659, Statutes of 2010,
establishes the Exchange. Requires the Exchange to be
governed by a five-member Board, as specified.
9)COMMENTS . There are some policy decisions that remain to be
decided, as well as a few technical details that need further
development. The most significant are as follows:
a) Pregnant Women . It is the intent of the author, as
reflected in this bill, to provide all medically necessary
medical services to pregnant women to help prevent
premature delivery and low birth weight and to promote
women's overall health, well-being, and financial security.
In addition, data show that women with family income under
200% of FPL are significantly more likely to be in poor
health coming into care than women with higher incomes and
to have psychosocial and/or medical complications that a
general community obstetrician/gynecologist may be less
prepared to manage. Examples of medical complications that
are more likely to be present in low-income populations of
pregnant women include seizure disorder, poorly controlled
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diabetes, hypertension, heart disease, and chronic renal
failure due to poor control of hypertension or diabetes.
Furthermore, almost half of all births in California are
financed by the Medi-Cal program and the child is likely to
be eligible at birth. Preventing complications in the baby
is therefore ideal.
The intersection of the current public programs for pregnant
women and new requirements under the ACA has opened up new
opportunities that present policy choices, as well as
technical challenges. For instance a state can use premium
assistance for cost-sharing assistance and benefit
wrap-around coverage requirements to the extent that the
current programs don't meet Medicaid standards to purchase
a QHP in the Exchange. These solutions appear to meet the
requirements for comprehensive coverage and cost
effectiveness. Ensuring a coordinated comprehensive
benefit package that meets federal standards, that is not
administratively burdensome and is easy to access will
require additional design details.
b) Legal Immigrants . Federal law subjects lawfully present
immigrants to the individual mandate and related tax
penalty, unless exempt due to very low-income. This
category of immigrants is eligible to enroll in a QHP and
is eligible for premium tax credits. However, the current
federal immigration eligibility restrictions apply so that
there is a five-year waiting period for most lawfully
residing, low-income immigrant adults before federal
matching funds are available in the Medicaid program. This
bill attempts to maximize funding by taking advantage of
premium assistance opportunities for newly eligible
immigrants, obtaining premium tax credits and limiting the
out-of-pocket costs for low-income immigrants. This bill
also attempts to provide Medi-Cal scope of benefits and
resolve timing challenges posed by the limited open
enrollment periods of the Exchange.
c) Eligibility verification and reasonable compatibility .
If eligibility information obtained through the state's
verification process is reasonably compatible with the
information provided by the individual, it must be used to
determine eligibility without requesting further
information. The definition of reasonably compatible is
left to the states. This bill provides for
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self-attestation where allowed under federal law, but does
not yet include the specifications of a verification plan.
This bill also does not provide guidance on what will be
considered reasonably compatible and how discrepancies are
to be resolved. These details will have to be added.
d) Early adoption of MAGI-based rules . During the 2013
open enrollment period for coverage in the Exchange or an
insurance affordability program (October 1, 2013 to
December 31, 2013), eligibility for certain applicants will
be determined using MAGI-based methodologies for coverage
scheduled to start on January 1, 2014. In addition, during
this period, people applying for or renewing Medicaid for
coverage in 2013 will also need to have their eligibility
assessed based on existing Medicaid rules. As a result,
states will need to be able to determine Medicaid
eligibility under both MAGI-based rules and current rules
during this limited period of time. To avoid having to
operate two sets of rules for children, parents and
caretaker relatives, pregnant women, and other
non-disabled, non-elderly adults that may be eligible for
Medicaid or CHIP enrollment during this period, CMS is
offering states the opportunity to begin using the new
MAGI-based methodology for these populations effective
October 1, 2013, to coincide with the start of the open
enrollment period. CMS is also offering the states the
option of extending the Medicaid renewal period so that
renewals that would otherwise occur during the first
quarter of calendar year 2014 (January 1, 2014 through
March 31, 2014), occur later. This is to ensure, as
required by the ACA, a person enrolled in Medicaid on or
before December 31, 2013, is not found ineligible solely
because of the application of MAGI and new household
composition rules before March 31, 2014, or the
individual's next regular renewal date, whichever is later.
The author may wish to consider adding these options.
e) Options to enroll based on other eligibility . Recent
studies by both the Center on Budget and Policy Priorities
and the Urban Institute find that, despite the differences
in household composition and income-counting rules, the
vast majority of non-elderly, non-disabled individuals who
receive SNAP benefits are very likely also to be
financially eligible for Medicaid. Based on these
analyses, CMS is offering states the opportunity to
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streamline the enrollment into Medicaid of these
non-elderly, non-disabled SNAP participants. To assist
states in the initial phases of implementing new
eligibility and enrollment systems, CMS is also offering
states the opportunity to facilitate the Medicaid
enrollment of parents whose children are currently enrolled
in Medicaid and who are likely to be Medicaid-eligible.
This opportunity is available for a temporary period and
could remain in effect until such time as the initial
influx of applications is addressed or the state is able to
handle the demands associated with the new system most
efficiently. The author may also wish to consider these
options.
f) Medi-Cal plan choice . CalHEERS is developing online
tools to assist consumers with choosing a QHP based on
extensive research and testing by organizations with
experience in consumer behavior and preferences. However,
the design specifications have delayed equivalent tools for
individuals eligible for Medi-Cal to be able to choose a
plan. Medi-Cal currently uses a Health Care Options (HCO)
process, through which the individual receives a paper
choice form. If the individual does not choose a plan and
is in a mandatory enrollment county, they are default
enrolled. Additional amendments are needed to reconcile
the existing HCO process with the new simplified and
streamlined enrollment process and to allow a Medi-Cal or
CHIP eligible individual to be able to choose a plan at the
point of application, either through the Exchange or the
county social services agency.
g) Regulatory authority . The Administrative Procedures Act
(APA) requires every department, division, office, officer,
bureau, board, or commission in the executive branch of the
California state government to follow the rulemaking
procedures in the APA and regulations adopted by the Office
of Administrative Law (OAL), unless expressly exempted by
statute from some or all of these requirements. The APA
requirements are designed to provide the public with a
meaningful opportunity to participate in the adoption of
regulations or rules that have the force of law by
California state agencies and to ensure the creation of an
adequate record for the public, OAL, and judicial review.
Regulations are required to be adopted with opportunities
for public comment, including public hearings. There are
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provisions for adoption of emergency regulations with an
abbreviated process. DHCS has regularly requested to be
exempt from these requirements and has sought legislative
authority to adopt policy changes by means of all-county
letters, provider bulletins, all-plan letters, or other
similar instructions. In the process of identifying the
changes that must be made to current law to conform to the
ACA, it became apparent that this lack of a coherent
statutory and regulatory framework makes it very difficult
to determine what the law is. This bill attempts to
codify, as much as possible, provisions required to
implement the ACA. This includes codifying or revising
existing regulations or superseding policy adopted without
regulation. This bill also limits the grants of further
authority to DHCS to make or adopt policy without new
legislation or the adoption of regulations.
REGISTERED SUPPORT / OPPOSITION :
Support
100% Campaign
AARP
Alliance for Boys and Men of Color Health Policy Work Group
American Cancer Society Cancer Action Network
American Congress of Obstetricians and Gynecologists
American Federation of State, County, and Municipal Employees
American Heart Association
Arc and United Cerebral Palsy California Collaboration
Asian Pacific American Legal Center
Autism Speaks
Binational Center for the Development of Oaxacan Indigenous
Communities
California Academy of Family Physicians
California Association of Addiction Recovery Resources
California Association of Alcoholism and Drug Abuse Counselors
California Association of Public Hospitals and Health Systems
California Black Health Network
California Chapter of the National Organization for Women
California Chiropractic Association
California Coverage and Health Initiatives
California Family Resource Association
California Health Advocates
California Hospital Association
California Immigrant Policy Center
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California Labor Federation
California Latinas for Reproductive Justice
California Mental Health Directors Association
California National Organization for Women
California Nurses Association
California Opioid Maintenance Providers
California Pan-Ethnic Health Network
California Primary Care Association
California School Employees Association, AFL-CIO
California School Health Centers Association
California State Association of Counties
California State Parent Teacher Association
California Teachers Association
Californians for Patient Care
Californians for Safety and Justice
Children Now
Children's Defense Fund California
Children's Partnership
Chinese Progressive Association of San Francisco
Congress of California Seniors
Counsel of Mexican Federations
Consumers Union
County Welfare Directors Association of California
Epilepsy California
Friends of the Family
Greenlining Institute
Health Access California
Health Officers Association of California
Korean Community Center of the East Bay
Latino Coalition for a Healthy California
Latino Health Alliance
Los Angeles Area Chamber of Commerce
Los Angeles County Board of Supervisors
Mexican American Legal Defense and Educational Fund
March of Dimes Foundation - California Chapter
Maternal and Child Health Access
National Association of Social Workers - California Chapter
National Council of La Raza
National Health Law Program
Partners in Advocacy
PICO California
Planned Parenthood Advocacy Project Los Angeles County
Planned Parenthood Affiliates of California
Planned Parenthood Mar Monte
Planned Parenthood of Orange and San Bernardino Counties
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Planned Parenthood of the Pacific Southwest
PolicyLink
San Joaquin County Board of Supervisors
San Mateo County Central Labor Council
Santa Clara County Board of Supervisors
Service Employees International Union - California State Council
Six Rivers Planned Parenthood
Transgender Law Center
United Nurses Association of California/Union of Health Care
Professionals
United Ways of California
Western Center on Law and Poverty
Opposition
None on file.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097