BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 509|
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THIRD READING
Bill No: SB 509
Author: DeSaulnier (D) and Emmerson (D)
Amended: 5/24/13
Vote: 27 - Urgency
SENATE HEALTH COMMITTEE : 8-0, 5/8/13
AYES: Hernandez, Anderson, Beall, De Le�n, DeSaulnier, Monning,
Nielsen, Pavley
NO VOTE RECORDED: Wolk
SENATE APPROPRIATIONS COMMITTEE : 7-0, 5/23/13
AYES: De Le�n, Walters, Gaines, Hill, Lara, Padilla, Steinberg
SUBJECT : California Health Benefit Exchange: background
checks
SOURCE : Author
DIGEST : This bill (1) requires the California Health Benefits
Exchange (known as Covered California) to submit to the
Department of Justice (DOJ), fingerprint images and related
information of employees, prospective employees, contractors,
subcontractors, volunteers, or vendors for the purposes of
obtaining criminal history information; (2) requires Covered
California to require any services contract, interagency
agreement, or public entity agreement to require the same
background check information from their contractors and
contractor's employees; (3) requires the DOJ to forward to the
Federal Bureau of Investigation (FBI) requests for federal
summary criminal history information, and requires the DOJ to
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review the information returned from the FBI and to compile and
disseminate a response to the board; and requires the DOJ to
charge a fee sufficient to cover the costs of processing these
requests.
ANALYSIS :
Existing law:
1.Establishes Covered California in state government, which is
governed by the California Health Benefits Exchange Board
composed of five members.
2.Requires, under federal law, Covered California to make
available Qualified Health Plans (QHPs) to qualified
individuals and qualified employers.
3.Requires Covered California to inform individuals of
eligibility requirements for the Medi-Cal program, the Healthy
Families Program (HFP), or any applicable state or local
public program. Requires Covered California to enroll
individuals in any such program if it is determined that such
an individual is eligible.
4.Permits Covered California to adopt rules and regulations, as
necessary, in accordance with the Administrative Procedure Act
until January 1, 2016.
5.Requires, under federal law, any person who receives
information provided by an applicant or from a federal agency,
to use the information only for the purposes of ensuring the
efficient operation of Covered California, as specified.
6.Makes any person authorized to receive state summary criminal
history information, who knowingly furnishes the information
to a person who is not authorized, guilty of a misdemeanor.
This bill:
1.Requires Covered California executive board (board) to require
and submit to the DOJ fingerprint images and related
information of all employees, prospective employees,
contractors, subcontractors, volunteers, or vendors for the
purposes of obtaining information as to the following
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information:
A. The existence and content of a record of state or
federal convictions; and,
B. The existence and content of a record of state or
federal arrests for which the DOJ establishes that the
person is free on bail or released on his/her own
recognizance pending trial or appeal.
2.Requires the board to require any services contract,
interagency agreement, or public entity agreement to require
the same previously mentioned background check information
from their contractors and contractor's employees.
3.Requires the DOJ to forward to FBI requests for federal
summary criminal history information received. Requires the
DOJ to review the information returned from the FBI and
compile and disseminate a response to Covered California.
4.Requires the DOJ to provide to Covered California, on
individuals who were initially subject to a criminal history
information check, subsequent conviction and arrest
information for individuals awaiting trial that are
incarcerated, released on bail, or released on their own
recognizance pending trial. Requires Covered California to
request from the DOJ this subsequent notification service.
5.Requires the DOJ to charge a fee sufficient to cover the cost
of processing requests under this bill.
6.Contains an urgency clause that makes this bill effective upon
enactment.
Background
Covered California. Covered California indicates the requirement
for a fingerprint check against federal and state arrest comes
from the federal Minimum Acceptable Risk Standards for Exchanges
(MARS-E) Personnel Screening Requirements. MARS-E requires
organizations to screen individuals prior to authorizing access
to information systems, and rescreen individuals periodically,
consistent with the criticality/sensitivity rating of the
position. To meet these MARS-E requirements, Covered California
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must perform a criminal history check for all persons prior to
employment and, require appropriate personnel to obtain and hold
a moderate-risk security clearance as defined in the federal
personnel security/suitability handbook.
Differing requirements for agents, state health insurance
programs, and eligibility entities . The Managed Risk Medical
Insurance Board (MRMIB), which administers the HFP, the Access
for Infants and Mothers Program (AIM), the Major Risk Medical
Insurance Program and the federal Pre-Existing Condition
Insurance Program (PCIP), does not require its employees to
undergo fingerprinting or a criminal background check. However,
Maximus, which performs eligibility determinations for MRMIB's
HFP, AIM and PCIP, states if performs a national criminal
background check on all of its employees, but does not require
them to be fingerprinted.
DHCS' Medi-Cal Eligibility Division indicates its state Medi-Cal
employees are neither fingerprinted nor do they undergo a
criminal background check. Counties must conduct a background
screening of a county worker before a county worker may access
personal identifying information. This screening requirement
does not specifically require fingerprinting and a criminal
background check, though counties have policies that include
those requirements.
The Insurance Commissioner is authorized to require the
fingerprints on applications for any, some, or all of the
licenses issued under the Insurance Code, and to require
authenticated fingerprints.
Equal Employment Opportunity Enforcement (EEOC) Guidance . In
April 2012, the EEOC published "Enforcement Guidance on the
Consideration of Arrest and Conviction Records in Employment
Decisions Under Title VII of the Civil Rights Act of 1964"
regarding the use of arrest or conviction records in employment
decisions under Title VII of the Civil Rights Act of 1964 (Title
VII). The EEOC Guidance states that an employer's use of an
individual's criminal history in making employment decisions,
may, in some instances, violate the prohibition against
employment discrimination under Title VII.
Fingerprinting process background . According to the DOJ,
approximately 35,000 entities perform background checks through
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the DOJ's Bureau of Criminal Information and Analysis.
Individuals who are required to be fingerprinted must fill out a
one page form (typically provided by their employer) entitled
"Request for Live Scan Service" that asks for information about
the individual's name, date of birth, gender, height, weight,
place of birth, address, and Social Security number. The
rolling of the individual's fingerprints must be done by a
certified Live Scan operator. Once submitted to the DOJ by the
Live Scan operator, the fingerprints are searched against all
arrest fingerprint images submitted to and maintained by the DOJ
from California law enforcement agencies. The applicant's
fingerprints are retained and are searched against all new
arrest fingerprint images. Biometric matches result in
subsequent notification to the affected response agency,
generally within 48 to 72 hours.
Prior Legislation
SB 900 (Alquist, Chapter 659, Statutes of 2010), establishes
Covered California as an independent public entity within state
government, and requires Covered California to be governed by a
board composed of the Secretary of California Health and Human
Services Agency, or his/her designee, and four other members
appointed by the Governor and the Legislature who meet specified
criteria.
AB 1602 (John A. P�rez, Chapter 655, Statutes of 2010),
specifies the powers and duties of Covered California relative
to determining eligibility for enrollment in the Covered
California, and requires Covered Coverage to arrange for
coverage throughQHPs.
AB 2343 (Torres, Chapter 256, Statutes of 2012), requires that,
when state or federal summary criminal history information is
furnished, the authorized agency, organization, or individual
furnish a copy of the information to the person to whom the
information relates if the information is a basis for an adverse
employment, licensing, or certification decision.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
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One-time costs of about $60,000 and ongoing costs of
about $40,000 to perform background checks on Health
Benefit Exchange employees (federal funds).
One-time costs of about $1.2 million to perform
background checks for volunteer "assistors" (federal
funds).
SUPPORT : (Verified 5/23/13)
Independent Insurance Agents and Brokers of California
ARGUMENTS IN SUPPORT : According to the author's office:
Recently-released federal privacy and security guidelines
require state exchanges to perform criminal background
checks on any personnel or potential personnel whose duties
include, or would include, having access to personal health
or financial information for exchange applicants and
enrollees.
The author's office states that, Covered California has
determined that these requirements apply broadly to
employees, prospective employees, contractors,
subcontractors, volunteers and vendors who will have access
to personal information for Covered California applicants
and enrollees. Federal guidance requires that Covered
California protect and safeguard customers from
unauthorized and illegal access to or disclosure of this
information.
In a letter explaining the provisions of this bill, Covered
California indicates it has determined the most
comprehensive way to meet the federal MARS-E requirements
is to conduct fingerprint-based background checks. To
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implement this policy, Covered California states that DOJ
requires clear statutory authority to allow Covered
California to request and to receive criminal history
information from DOJ and the FBI. Covered California
states this bill provides the statutory authority that will
allow it to perform fingerprint-based background checks
prior to the employment of state service center employees
and community-based assisters.
The California Coverage and Health Initiatives, writes in
support that the January 1, 2014 date for Covered
California to be open to the public is only seven months
away and with open enrollment beginning in October, it is
crucial that the training and hiring of employees,
navigators, and assisters begin immediately in order to
maximize enrollment and guarantee not only coverage but the
success of Covered California.
JL:ejd 5/25/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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