BILL ANALYSIS Ó
AB 763
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Date of Hearing: April 22, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
763 (Burke) - As Introduced February 25, 2015
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Urgency: No State Mandated Local Program: YesReimbursable:
Yes
SUMMARY:
AB 763
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This bill expands income eligibility for Medi-Cal for aged,
blind, or disabled individuals through the Aged and Disabled
Federal Poverty Line (A&D FPL) program from a threshold that is
effectively 123% of the federal poverty level, to 138% of the
federal poverty level.
FISCAL EFFECT:
1)Increased net costs to the Medi-Cal program of around $60
million (50% GF/50% federal funds). Enrollment in the A&D FPL
program is projected to increase by approximately 20,000.
Costs in this program could increase by $100 million, with
offsetting cost decreases in the "Share of Cost" (SOC) program
of $40 million, leaving a net cost of $60 million. Population
estimates have been refined based on new data since a similar
bill was introduced last year.
This estimate assumes Medi-Cal pays half as much on average
for an enrollee in SOC Medi-Cal as compared to an enrollee in
the full-scope A&D FPL program, that the average annual cost
for A&D FPL enrollee is $5,100 and that 80% of individuals
gaining full-scope coverage due to this bill are currently
enrolled in SOC Medi-Cal.
2)Potential additional cost avoidance to Medi-Cal, to the extent
the individuals who gain comprehensive coverage through this
coverage expansion remain healthier and avoid more costly
institutional care. Annual per-person costs for institutional
long-term care range from $65,000 to $90,000 per year for this
population.
3)Costs for programming eligibility changes are expected to be
minor and absorbable.
AB 763
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COMMENTS:
1)Purpose. The author states increasing the income threshold to
allow more aged, blind, and disabled individuals to receive
Medi-Cal without a share of cost addresses two problems: (1)
it brings income eligibility for elderly and disabled
individuals in line with that for non-elderly, non-disabled
individuals, and (2) it allows these individuals to qualify
for comprehensive Medi-Cal benefits instead of the
"share-of-cost" Medi-Cal, which effectively amounts to
catastrophic coverage for most people who qualify.
2)Medi-Cal Eligibility. Eligibility rules have been simplified
for certain populations as a result of the Affordable Care Act
(ACA). Pursuant to ACA and California's decision to expand
Medi-Cal, individuals under 65 are generally able to qualify
based strictly on a Modified Adjusted Gross Income (MAGI) of
under 138% of the federal poverty level. This creates a
so-called "bright line" at 138% of poverty for the majority of
enrollees. However, eligibility for certain populations,
including the aged, blind, and disabled, is still determined
under more complicated old rules that account for numerous
factors such as income levels, income disregards, and a
person's assets.
This bill would allow aged, blind, and disabled individuals
with incomes between 123% and 138% FPL, many of whom currently
qualify for "Share of Cost" (SOC) Medi-Cal, to qualify for
comprehensive Medi-Cal benefits without a share of cost. SOC
Medi-Cal is effectively catastrophic-only coverage. The
individuals targeted by this bill who qualify for SOC Medi-Cal
have to "spend down" over $600 out of pocket on health care in
a given month before they receive any Medi-Cal benefits. This
bill would instead allow them to receive full Medi-Cal with no
SOC. Aged, blind, and disabled individuals with incomes over
the new 138% threshold would still qualify for SOC Medi-Cal.
AB 763
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3)Prior Legislation. AB 2877 (Thomson), Chapter 93, Statutes of
2000, the health budget trailer bill, established the A&D FPL
program, a no-share-of-cost Medi-Cal benefit for many elderly
and disabled recipients who previously had to pay a
significant share of cost to access Medi-Cal services.
AB 969 (Chan) of 2001, which incorporated annual
cost-of-living increases in the A&D FPL formula, was held in
the Senate Appropriations Committee.
AB 55 (Dymally) of 2007 was substantially similar to this
bill, but increased the income threshold to 133% of FPL
instead of 138%. It was amended to a different subject matter
before its first policy hearing in the Senate.
AB 2025 (Dickinson) of 2014 was substantially similar to this
bill and was held on the Suspense File of this committee.
Analysis Prepared by:Lisa Murawski / APPR. / (916)
319-2081