BILL ANALYSIS Ó
SB 508
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Date of Hearing: July 2, 2014
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
SB 508 (Hernandez) - As Amended: June 5, 2014
Policy Committee: HealthVote:13-6
Urgency: No State Mandated Local Program:
Yes Reimbursable: Yes
SUMMARY
This bill codifies numerous Medi-Cal eligibility requirements
related to implementation of the federal Patient Protection and
Affordable Care Act (ACA). Specifically, this bill:
1)Specifies in statute the Medi-Cal income eligibility
thresholds (as a percentage of poverty) currently in use for
various eligibility groups including children, whose income
is determined based on modified adjusted gross income (MAGI).
2)Specifies, for children, the income thresholds subject to
premium payments.
3)Clarifies the state's eligibility rules for former foster
youth (FFY) to allow specified FFY Medi-Cal eligibility up to
age 26.
4)Eliminates the deprivation requirement, which requires certain
socioeconomic circumstances such as a missing or unemployed
parent, from the eligibility criteria for the "medically
needy" eligibility category.
5)Requires Medi-Cal income eligibility for coverage of
tuberculosis-related services to be determined pursuant to
MAGI-based financial methods effective January 1, 2014.
FISCAL EFFECT
1)This bill has four main components. The first component, the
specification in statute of income thresholds, codifies
current administrative practice under existing authority.
Therefore, placing these income thresholds in law is not
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expected to increase costs. Similarly, the component related
to tuberculosis services conforms the income eligibility
methodology for these services to that used for most other
Medi-Cal categories, and should have a negligible cost impact.
Two other components, namely, the elimination of the
deprivation requirement in the medically needy program and the
changes related to former foster youth eligibility, may have a
minor fiscal impact. Both changes will potentially increase
state costs by expanding the number of people eligible for
Medi-Cal. Assuming average per-person costs in the medically
needy program are $10,000 annually, average per-person costs
for former foster youth are $2,000 annually, and 50
individuals enroll due to the deprivation changes and 10 new
former foster youth enroll due to the foster youth program
changes, costs would be $520,000 (50% GF, 50% federal).
The former foster youth provisions appear to be necessary
pursuant to federal maintenance of effort requirements in the
ACA, under which states must maintain Medi-Cal eligibility
rules in place for children until 2019. The deprivation
change also appears to be required to maintain compliance with
federal rules, but based on how the state has chosen to
structure related programs. Since the state chose to
eliminate the deprivation requirement for a separate
eligibility category, the federal government has, according to
the author, stated the deprivation requirement must be
eliminated in the medically needy program as well. Written
verification that these specific changes are federally
required was unavailable at the time of this analysis.
2)This bill is tagged as a potential state-reimbursable mandate
because county eligibility workers conduct eligibility
screenings on behalf of the state. But no increased
administrative costs to counties are expected as a direct
result of this bill, since changes should not significantly
impact county workload and have already been incorporated into
county eligibility operations.
COMMENTS
1)Purpose . This bill is a follow-up to SB X1 1 and AB X1 1 of
2013, which implemented the state's expansion and
simplification of Medi-Cal eligibility pursuant to the federal
Patient Protection and Affordable Care Act (ACA). This bill
largely aligns state law with current practice and federal
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requirements related to the new Medi-Cal requirements and
options the state adopted in these two bills.
2)Prior Legislation .
a) AB 1 X1 (John Perez), Chapter 3, Statutes of 2013
implemented specified Medicaid provisions of the ACA,
including the expansion of federal Medicaid coverage to
low-income adults with incomes up to 138% of the federal
poverty level. AB 1 X1 also implemented a number of the
Medicaid ACA provisions to simplify the eligibility,
enrollment and renewal processes for Medi-Cal.
b) SB 1 X1 (Hernández), Chapter 4, Statutes of 2013
established the existing Medi-Cal benefit package as the
benefit package for the expansion population eligible under
the ACA and expanded the Medi-Cal benefit package for the
existing population and newly eligible under the ACA to
include mental health services and substance use disorder
services required under the essential health benefit
legislation adopted in 2012 that were not currently covered
by Medi-Cal. SB 1 X1 also implemented a number of the
Medicaid ACA-related provisions to simplify the
eligibility, enrollment and renewal processes for Medi-Cal.
Analysis Prepared by : Lisa Murawski / APPR. / (916) 319-2081