BILL ANALYSIS Ó SENATE COMMITTEE ON HEALTH Senator Ed Hernandez, O.D., Chair BILL NO: AB 1319 --------------------------------------------------------------- |AUTHOR: |Dababneh | |---------------+-----------------------------------------------| |VERSION: |February 27, 2015 | --------------------------------------------------------------- --------------------------------------------------------------- |HEARING DATE: |July 8, 2015 | | | --------------------------------------------------------------- --------------------------------------------------------------- |CONSULTANT: |Scott Bain | --------------------------------------------------------------- SUBJECT : Medi-Cal benefits: share of cost requirements. SUMMARY : Increases the personal and incidental needs deduction for Medi-Cal beneficiaries residing in a licensed community care facility from $20 to $50. Existing law: 1)Establishes the Medi-Cal program, which is administered by the Department of Health Care Services (DHCS), under which qualified low-income individuals receive health care services. 2)Establishes Medi-Cal eligibility for medically needy persons and medically needy family persons, provided Medi-Cal eligibility criteria are met. (The medically needy Medi-Cal eligibility category are individuals who fit into a federal benefit program category but whose income or resources exceed eligibility levels. Medically needy individuals become Medi-Cal eligible by having a share of cost whereby the individual "spends down" to Medi-Cal eligibility levels.) 3)Requires certain aged, blind, and disabled Medi-Cal recipients to pay a share of cost as a condition of eligibility, with the share of cost determined in accordance with specified requirements. 4)Requires, in determining the countable income of a medically needy individual residing in a licensed community care facility, the individual to have deducted from his or her income $20 as a personal and incidental needs deduction. This bill increases the personal and incidental needs deduction for Medi-Cal beneficiary residing in a licensed community care AB 1319 (Dababneh) Page 2 of ? facility from $20 to $50, to the extent that federal financial participation is available and DHCS receives any necessary federal approvals. FISCAL EFFECT : According to the Assembly Appropriations Committee: 1)Increased costs, likely in the range of $100,000 or less (General Fund (GF)/federal), to allow certain Share-of-Cost (SOC) Medi-Cal beneficiaries to retain the additional monthly amount. 2)Unknown, likely significant costs for information technology changes in the three local Medi-Cal eligibility and case management systems (GF/federal). 3)According to the Department of Health Care Services (DHCS), by increasing the income deduction for SOC, individuals in the SOC program with incomes slightly above the income threshold for the Aged, Blind, and Disabled federal poverty level (FPL) program, a full-scope program with no SOC, will be eligible to transition to the FPL program. If this dynamic occurs, increasing the monthly income disregard by $30 would essentially make the income threshold 2.5 percentage points higher than it otherwise would be, for individuals residing in community care facilities. Increased enrollment in the FPL program would cost in the range of $1 million annually (GF/federal) for 200 additional beneficiaries. However, staff notes the language appears to apply only to SOC beneficiaries, so whether this shift would actually occur is unclear. 4)This bill is tagged as a reimbursable mandate. Eligibility for Medi-Cal is administered by counties and administrative costs are reimbursed through contract with the state. This change will require notification and minor adjustments in county policies and practices. The total cost pressure associated with this small change is unknown but likely minor, and it will not result in mandate claims due to the reimbursement structure for Medi-Cal county administration. PRIOR AB 1319 (Dababneh) Page 3 of ? VOTES : ----------------------------------------------------------------- |Assembly Floor: |80 - 0 | |------------------------------------+----------------------------| |Assembly Appropriations Committee: |17 - 0 | |------------------------------------+----------------------------| |Assembly Health Committee: |18 - 0 | | | | ----------------------------------------------------------------- COMMENTS : 1)Author's statement. According to the author, this bill will increase the personal and incidental needs deduction from $20 a month to $50 a month for an individual who qualifies for the Medically Needy program under Medi-Cal. Medically Needy is a federal Medicaid eligibility category option that provides states with the option to extend Medicaid eligibility to individuals with high medical expenses whose income exceeds the federal poverty line but who would otherwise be eligible for Medi-Cal. This program acts as a safety net for those who are among the most vulnerable in our population -- people whose medical costs overwhelm their income -- including more than 8,000 financially needy older adults. Passing this bill will truly provide seniors with dignity and greater financial stability to cover life's basic necessitates. 2)Background. Individuals whose income exceeds the income levels or who do not meet eligibility criteria for no-cost Medi-Cal can quality as medically needy individuals. The medically needy program is a way to extend Medi-Cal eligibility to individuals who do not qualify for no-cost Medi-Cal, such as those with high medical expenses whose income is too high to meet the income eligibility threshold for no-cost Medi-Cal. The program functions as a last resort for those whose incomes are modest and are surpassed by their significant medical expenses. For Medi-Cal beneficiaries residing in a community care facility, the share of cost calculation allows for a personal and incidental needs deduction. This amount is set in statute, is currently $20, and has been in effect since January 1, 1977. This amount is deducted from the individual's income in determining their share of cost. For example, if an individual with a monthly income of $1,300 who is residing in a licensed AB 1319 (Dababneh) Page 4 of ? community care facility would have the $20 personal and incidental needs deduction subtracted from his or her monthly income ($1,300 - $20 = $1,280). The $1,280 would be the individual's monthly share of cost. Under this bill, $50 would be subtracted, instead of $20. 3)Related legislation. AB 763 (Burke) increases the amount of income that is disregarded in calculating eligibility for purposes of the Medi-Cal aged and disabled (A&D) program which effectively increases the upper limit of financial eligibility to 138 percent of the federal poverty level (FPL). AB 763 was held on the Assembly Appropriations Committee suspense file. AB 1235 (Gipson) requires the home upkeep allowance (HUA) for Medi-Cal beneficiaries in long-term care facilities to be based on the actual minimum cost of maintaining the resident's home (the HUA is currently $209 a month). Allows a long-term care facility resident who does not have a home to establish a transitional personal needs fund to be set aside from the income that otherwise would be applied toward the resident's Medi-Cal share of cost for residing in the long term care facility in an amount of up to $7,500. The personal needs fund would be used to cover the costs of securing a home for the individual. AB 1235 is pending in the Senate Appropriations Committee. 4)Support. The California Advocates for Nursing Home Reform (CAHNR) writes that the $20 deduction is used to offset countable income and could mean the difference between accessing affordable health care to making health care completely unaffordable. CANHR writes that a $30 difference may not seem like a lot, but many seniors are on a fixed income with increasing medical needs and are overwhelmed by the lack of affordable health care options available to them, and this bill would give many seniors and persons with disabilities much needed relief. SUPPORT AND OPPOSITION : Support: Los Angeles Jewish Home (sponsor) American Federation of State, County, and Municipal Employees California Advocates for Nursing Home Reform California Assisted Living Association California Commission on Aging AB 1319 (Dababneh) Page 5 of ? Leading Age California Ventura County Board of Supervisors Oppose: None received -- END --