BILL ANALYSIS �
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UNFINISHED BUSINESS
Bill No: SB 98
Author: Senate Budget and Fiscal Review Committee
Amended: 8/27/13
Vote: 21
PRIOR VOTES NOT RELEVANT
ASSEMBLY FLOOR : Not available
SUBJECT : Public health
SOURCE : Author
DIGEST : This bill specifies components of the Historical
Allocation methodology for purposes of counties calculating
revenue and costs for health care, and makes technical
corrections and clarifications to recently enacted health and
human services Budget Trailer bills.
Assembly Amendments delete the Senate version of the bill, which
expressed legislative intent to enact statutory changes relating
to the Budget Act, and instead add the current language.
ANALYSIS :
Existing law:
1.Requires, commencing January 1, 2014, as revised by AB 74, for
eligibility and participation in the California Work
Opportunity and Responsibility to Kids (CalWORKs) program,
CONTINUED
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that the equity value of each licensed vehicle belonging to an
applicant or recipient not be greater than $9,500.
2.Requires, with certain exceptions, every individual, as a
condition of eligibility for aid under the CalWORKs program,
to participate in certain welfare-to-work activities for a
period of 24 months. Provides that any month in which certain
conditions exist shall not be counted as one of the 24 months
of participation.
3.States the Legislature's intent to create a program in
California that provides a Low-Income Home Energy Assistance
Program (LIHEAP) service benefit, through the LIHEAP block
grant, to all recipient households of CalFresh, the state's
version of the federal Supplemental Nutrition Assistance
Program (SNAP).
4.Establishes the Local Revenue Fund (LRF), a continuously
appropriated fund, that allocates vehicle license fee (VLF)
and sales tax funds, and creates various accounts and
subaccounts within that fund, including the Health Subaccount
and the Social Services Subaccount, each of which receive
funding from the LRF.
5.Requires, pursuant to AB 85, a reallocation of funds in the
2013-14 fiscal year and subsequent fiscal years to change the
relative percentages of funds from sales tax and VLF fund
sources that are allocated to the Health Subaccount and the
Social Services Subaccount. Specifically, AB 85 requires
permanently redirecting $1 billion in sales tax allocations
from the Social Services Subaccount to the Health Subaccount,
and, vice versa, $1 billion in VLF allocations.
6.Requires counties, through a choice of methodologies, to
provide specified health services to eligible county residents
who are indigent.
7.Requires the Department of Health Care Services (DHCS), in
consultation with the counties, to determine the historical
low-income shortfall between Medi-Cal and uninsured revenues
and the costs incurred by county public hospital health
systems for health services to Medi-Cal beneficiaries and
uninsured patients.
8.Requires DHCS to submit to the Legislature a "fair and
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reasonable methodology" to allocate three specific funding
amounts to determine the historical amounts necessary for the
operation of the county public hospital health system formula.
This bill:
1.Makes changes to sections effectuated through recently-enacted
Trailer Bill legislation (AB 85, Chapter 24, Statutes of
2013):
A. Proposes a "Historical Allocation" methodology to fairly
allocate available revenues proportionally for all
unreimbursed costs incurred by county public hospital
health systems, by determining the historical amounts or
percentages of three specified revenue sources. This
proposed methodology was developed, and agreed to, by DHCS
and the California Association of Public Hospitals & Health
Systems, as required by AB 85. This methodology will
determine the sources and amounts of each of the following
three historical revenue sources that are currently used by
counties to fund Medi-Cal and uninsured costs: (1)
unrestricted special local health funds; (2) one-time and
carry-forward revenues; and (3) county general purpose
funds.
B. Repeals obsolete statute that directs DHCS to develop an
allocation methodology by September 13, 2013, for the
purpose of such a methodology being codified in statue.
The proposed methodology, required by this section, is
contained within this bill.
C. Specifies a specific calculation methodology for the
applicable shortfalls and their relative proportions.
D. Specifies a specific calculation methodology for the
applicable total funding amounts for each funding source
and the amount of each source needed to fund the total
shortfall.
E. Specifies a specific calculation methodology for the
applicable amount of each source to allocate as a revenue
source for Medi-Cal and uninsured health costs.
F. Specifies certain aspects of the calculation methodology
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that are to be unique to Los Angeles County.
G. Changes references to other sections of law as they were
adopted in AB 85, in a new Section 17600.50, to instead
reference those sections as they read on January 1, 2012 or
July 1, 2013, so as to accurately account for fund levels
and to avoid artificially inflating the amounts of growth
funds being redirected.
H. Corrects erroneous citations for the Family Support
Subaccount, removing the word "Services" where it was
previously incorrectly included.
I. Provides additional time to establish the historical
amounts and for counties to elect the 60/40 option or the
formula.
J. Makes other technical, nonsubstantive changes to
provisions enacted by AB 85 to correct errors and comply
with administrative norms requested by the Department of
Finance (DOF), State Controller's Office (SCO), and
counties.
1.Makes additional changes to sections effectuated through AB
85, specifically with respect to the use of sales tax and VLF
funds as follows:
A. Requires the SCO to allocate sales tax and VLF funds to
health and social services accounts as these funds were
allocated prior to enactment of AB 85.
B. Requires the SCO to transfer, on a monthly basis and
pursuant to a schedule provided by the DOF, no more than
$300 million in sales tax funds from the Social Services
Subaccount to the Health Subaccount in 2013-14. This
change constitutes an appropriation.
C. For 2014-15 and all fiscal years thereafter, requires
the SCO to transfer, on a monthly basis and pursuant to a
schedule provided by DOF, no more than $1 billion annually
in sales tax funds from the Social Services Subaccount to
the Health Subaccount.
D. Requires the SCO to adjust on a monthly basis, pursuant
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to a schedule provided by Finance, the monthly VLF
distributions to reflect the equal exchange of sales tax
funds from the Social Services Subaccount to the Health
Subaccount that begins in 2013-14.
E. Clarifies that the transfers and adjustments above
cannot be used in calculating future year sales tax and VLF
allocations to the social services and health accounts.
1.Makes changes to sections effectuated through recently-enacted
human services-related trailer bills, including AB 74 and SB
94 (Chapters 21 and 37 respectively, Statutes of 2013) as
follows:
A. Changes the term "licensed vehicle" to "motor vehicle"
in the section of law that was recently revised relating to
the allowable value of a licensed vehicle retained by an
applicant or recipient of CalWORKs aid. This change allows
for the valuation and exemption rules to apply to
unlicensed vehicles.
B. Makes a nonsubstantive change to clarify that any month
in which "any of" the specified conditions exists shall not
be counted as one of the 24 months of participation allowed
under existing law.
C. Corrects a code reference that had been included in the
Coordinated Care Initiative Trailer Bill, SB 94, related to
the provision of services in certain counties.
D. Corrects an erroneously included reporting provision
regarding the LIHEAP service benefit that had previously
been stricken in recently chaptered legislation.
E. Specifies that the nominal LIHEAP services benefit be
funded through the LIHEAP grant allocated for outreach
activities in accordance with state and federal
requirements.
F. Contains an appropriation allowing this bill to take
effect immediately upon enactment.
Comments
This bill is necessary in order to codify the Historical
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Allocation methodology developed and agreed to by DHCS and
public hospital systems, in order to fully implement AB 85.
This bill also makes numerous technical corrections that will
clarify and ease the implementation of health and human services
budget trailer bills associated with the 2013-14 Budget.
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: No
According to the Department of Finance, there is no fiscal
effect as a result of these largely technical and clarifying
changes.
JA:ej 9/6/13 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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