BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Kevin de Le�n, Chair
SB 320 (Beall) - Health care coverage: acquired brain injury.
Amended: April 3, 2013 Policy Vote: Health 5-2
Urgency: No Mandate: Yes
Hearing Date: May 13, 2013 Consultant: Brendan McCarthy
This bill meets the criteria for referral to the Suspense File.
Bill Summary: SB 320 would mandate health plans and health
insurers to provide coverage for medically necessary medical or
rehabilitation treatments for acquired brain injuries at
specified facilities.
Fiscal Impact:
One-time costs of about $270,000 for the development of
regulations, review of health plan filings, and initial
enforcement activities by the Department of Managed Health
Care (Managed Care Fund).
Ongoing costs of about $200,000 per year for responding to
customer complaints and enforcement activities by the
Department of Managed Health Care (Managed Care Fund).
One-time costs of $150,000 to $300,000 for the development
of regulations and the review of insurance policy filings by
the Department of Insurance (Insurance Fund).
Unknown ongoing costs for responding to customer complaints
and enforcement activities by the Department of Insurance
(Insurance Fund).
Unknown costs to state health care programs such as
Medi-Cal and CalPERS. Because the bill's impact on coverage
by health plans and health insurers cannot be determined,
the fiscal impact on state health care programs cannot be
determined. See below.
Unknown costs to the state to pay for subsidized health
care coverage through the California Health Benefit
Exchange. Because the bill's impact on coverage by health
plans and health insurers cannot be determined, the cost to
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the state to subsidize coverage in the Exchange cannot be
determined. See below.
Background: Under the federal Patient Protection and Affordable
Care Act (Affordable Care Act), health coverage provided in the
small group or individual market (including through health
exchanges) must provide essential health benefits. Federal law
specifies that essential health benefits include ten specified
categories of benefits - including rehabilitative and
habilitative services. Federal guidance allows the states to
designate a benchmark essential health benefits plan. All health
plans offered for sale in the individual and small group markets
will have to provide the same level of benefits as is provided
by the benchmark plan.
State law establishes the Kaiser Small Group HMO plan as the
benchmark plan. By selecting this plan (and as authorized under
federal law) the state has incorporated all existing benefit
mandates that apply to the Kaiser Small Group HMO plan into the
state's essential health benefits.
Under federal law, individuals purchasing coverage through
health benefit exchanges will be eligible for subsidies, based
on income, paid by the federal government. However, if a state
imposes a benefit mandate after January 1, 2012 that exceeds the
benefits provided by the essential health benefits benchmark
plan, the state is responsible for covering the proportional
cost of the subsidies attributable to that mandated benefit.
Proposed Law: SB 320 would mandate health plans and health
insurers to provide coverage for medically necessary medical or
rehabilitation treatments for acquired brain injuries at
specified facilities.
The facilities specified in the bill include:
Hospitals;
Acute rehabilitation hospitals;
Long-term care acute hospitals;
Adult residential or post-acute residential transitional
rehabilitation facilities;
Medical offices;
Other analogous facilities.
Related Legislation: SB 253 (Alquist, 2011) was substantially
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similar to this bill. That bill was held in the Senate Health
Committee.
Staff Comments: Under current law, the California Health
Benefits Review Program (part of the University of California)
analyzes proposed laws that mandate health care benefits or
services.
The California Health Benefits Review Program found that the
impacts on coverage and health care costs from SB 320 cannot be
determined. Unlike most health care mandate bills, this bill
does not mandate that specific benefits or services be provided
by health plans and health insurers. This bill requires that
medically necessary treatments be provided at certain
facilities. In general, most health plans and insurers in the
state already provide coverage for services at the specified
facility types. However, not all health plans and health
insurers provide coverage for medically necessary services at
adult residential or post-acute residential transition
facilities. Under the bill, coverage for medically necessary
services at those facilities would be mandated.
The California Health Benefits Review Program could not
determine whether the bill would result in increased utilization
of services because coverage would be extended to those
specified facilities. Therefore, the California Health Benefits
Review Program could not determine whether the bill will
increase health care costs.
If the bill were to increase health care costs (for example,
because of increased utilization of services at specified
facilities) state health care programs would experience
increased expenditures.
The Affordable Care Act requires the state to pay for the cost
of subsidizing any new benefit mandates. If the bill does result
in increased health care costs, the state would be required to
pay for the proportional cost of the subsidies attributable to
that mandated benefit. Researchers at the UC Berkeley Labor
Center have projected that enrollment in subsidized coverage
through the California Health Benefit Exchange is likely to be
between 1.7 million and 2.1 million. Given the large number of
people expected to be receiving subsidies through the Exchange,
even a minor increase in the annual cost of providing coverage
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because of a new state benefit mandate will have a significant
impact on the state.
The only costs that would be incurred by a local agency under
the bill relate to crimes and infractions. Such costs are not
reimbursable by the state under the California Constitution.