BILL ANALYSIS Ó
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THIRD READING
Bill No: SB 508
Author: Hernandez (D)
Amended: 1/9/14
Vote: 21
SENATE HEALTH COMMITTEE : 7-0, 1/15/14
AYES: Hernandez, Beall, De León, DeSaulnier, Monning, Pavley,
Wolk
NO VOTE RECORDED: Anderson, Nielsen
SENATE APPROPRIATIONS COMMITTEE : 4-1, 1/21/14
AYES: De León, Hill, Padilla, Steinberg
NOES: Gaines
NO VOTE RECORDED: Walters, Lara
SUBJECT : Medi-Cal: eligibility
SOURCE : Author
DIGEST : This bill codifies the Medi-Cal income eligibility
thresholds for parents and caretaker relatives, children, and
pregnant women whose income eligibility for Medi-Cal is
determined based on modified adjusted gross income (MAGI),
increases the income levels at which premiums are assessed for
coverage in Medi-Cal for children, eliminates the deprivation
requirement for the Medically Needy Medi-Cal program, and
clarifies that Medi-Cal eligibility for former foster youth
expansion up to age 26 includes individuals who lost eligibility
due to having reached the maximum age for foster care
assistance.
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ANALYSIS :
Existing law:
1.Establishes the Medi-Cal program, administered by the
Department of Health Care Services (DHCS), under which low
income individuals are eligible for medical coverage.
2.Requires DHCS to implement the Affordable Care Act (ACA)
expansion of Medi-Cal coverage to adults and parents up to
133% of the federal poverty level (FPL) (adults without minor
children are generally not eligible for Medi-Cal unless aged
or disabled, and parents applying for Medi-Cal are eligible if
they have family incomes at or below 100% of the FPL).
3.Requires DHCS to establish income eligibility thresholds for
those Medi-Cal eligibility groups whose eligibility will be
determined using MAGI-based financial methods.
4.Requires, effective January 1, 2014, when determining
eligibility for Medi-Cal benefits for non-elderly non-disabled
adults, an applicant's or beneficiary's income and resources
to be determined, counted, and valued in accordance with the
requirements of a provision of the ACA, which prohibits the
use of an assets or resources test for individuals whose
income eligibility is determined based on MAGI.
5.Implements the ACA requirement that a 5% income disregard
applies to individuals whose income eligibility is determined
based on MAGI, effectively making income eligibility 138% of
the FPL ($15,856 for an individual and $26,951 for a family of
3 in 2013).
This bill:
1.Establishes income eligibility thresholds for Medi-Cal
coverage whose income is determined based on MAGI as follows:
A. Parents and caretaker relatives: 0-109% of the FPL;
B. Pregnant women: 0-208% of the FPL;
C. Children: 0-261% of the FPL.
1.Increases the income level at which premiums for Medi-Cal
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coverage for children are assessed, to apply premiums for
children in families with incomes above 160 to 261% of the
FPL, instead of children in families with incomes from 150 to
250% of the FPL.
2.Requires Medi-Cal income eligibility for coverage of
tuberculosis-related services to be determined pursuant to
MAGI-based financial methods effective January 1, 2014.
3.Eliminates the deprivation requirement for the medically needy
Medi-Cal program by repealing the deprivation requirement from
the medically needy family person definition. (Medically needy
is a category of Medi-Cal eligibility that provides Medi-Cal
coverage for individuals who fit into a federal benefit
category [such as aged, blind or disabled] but whose income or
resources are too high.)
4.Clarifies that former foster youth are eligible for Medi-Cal
coverage up to age 26 if the individual lost his/her
eligibility for foster care assistance due to having reached
the maximum age for that assistance.
5.Deletes obsolete references to previous Medi-Cal income
eligibility provisions.
Comments
MAGI income conversion eligibility thresholds . The ACA requires
states to change the way they calculate income for purposes of
determining Medicaid eligibility. Beginning January 1, 2014,
eligibility for Medicaid (Medi-Cal in California) for most
individuals, as well as for the Children's Health Insurance
Program (CHIP, formerly the Healthy Families Program in
California before children were shifted into Medi-Cal), is
determined using methodologies based on MAGI, as defined in the
Internal Revenue Code of 1986. Eligibility for advance premium
tax credits for the purchase of private insurance coverage
through states exchanges will also use MAGI. The ACA allows
states to eliminate the deprivation requirement.
Under the ACA, previous state income disregards and asset or
resource tests no longer apply when calculating income
eligibility for most non-elderly non-disabled adults (under
income disregards, certain types of income is not counted or
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"disregarded" in determining Medi-Cal eligibility). To make the
change from the prior income methodologies to MAGI-based methods
without significantly changing current coverage levels, the ACA
requires states to establish income eligibility thresholds for
populations that are not less than the effective income
eligibility levels that applied under Medicaid on the date of
enactment of the ACA. The intent of this provision was for
states to establish MAGI-equivalent standards that protect
individuals eligible for Medicaid from losing coverage after
2014. States must convert their current financial eligibility
income standards from net standards (which include disregards)
to an equivalent MAGI income standard.
Repeal of deprivation requirement in medically needy program .
Under the Medi-Cal 1931(b) program, Medi-Cal covers children up
through age 18 (and up to age 19 if they are expected to
graduate from school) who are "deprived" of full parental
support, and parents and caretaker relatives. Deprivation means
at least one parent in the family must be absent, deceased or
disabled, or the principal wage earner must be unemployed or
underemployed.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
Minor administrative costs to DHCS (General Fund).
No expected change in Medi-Cal enrollment or costs. While the
bill does change eligibility standards and requirements for
the Medi-Cal program, these changes are intended to either
clarify changes already made by the Legislature when enacting
the Medi-Cal expansion (through SB 1 1X, Hernandez and
Steinberg, Chapter 4, Statutes of 2013-14 First Extraordinary
Session, and AB 1 1X, J. Perez, Chapter 3, Statutes of 2013-14
First Extraordinary Session) or to fix technical errors made
in the drafting of those bills. This bill is not expected to
increase enrollment beyond what was anticipated when the
Legislature enacted those bills.
SUPPORT : (Verified 1/21/14)
AFSCME
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California Primary Care Association
California State Association of Counties
County Welfare Directors Association of California
Western Center on Law and Poverty
ARGUMENTS IN SUPPORT : According to the author, this bill is a
follow-up bill to SB 1 1X and AB 1 1X, the Medi-Cal ACA
implementation bills. This bill would place into state law the
MAGI converted Medi-Cal income eligibility standards for parents
and caretaker relatives, children, and pregnant women, would
eliminate the deprivation requirement in the medically needy
Medi-Cal program, and would clarify eligibility for the former
foster youth Medi-Cal expansion. When AB 1 1X and SB 1 1X were
passed by the Legislature in June 2013, the MAGI-converted
Medi-Cal income eligibility standards were not known but have
subsequently been established administratively by DHCS. Placing
these amounts into state law provides greater transparency
regarding eligibility thresholds and updates current law to
reflect current income eligibility standards. This bill also
contains clean-up language to the former foster youth Medi-Cal
expansion and eliminates the deprivation requirement in the
medically needy Medi-Cal program in response to concerns raised
by the federal Centers for Medicare and Medicaid Services to
DHCS.
The Western Center on Law and Poverty (WCLP) supports this bill
to codify the new income levels for Medi-Cal under the ACA.
WCLP states that this bill makes some technical changes
regarding the Medi-Cal program for former foster youth to ensure
that California complies with federal law and provides this
vulnerable population with the health care benefits to which
they are entitled.
JL:nl 1/22/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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