BILL ANALYSIS Ó AB 2077 Page 1 Date of Hearing: April 5, 2016 ASSEMBLY COMMITTEE ON HEALTH Jim Wood, Chair AB 2077 (Burke) - As Amended March 18, 2016 SUBJECT: Health Care Eligibility, Enrollment, and Retention Act. SUMMARY: Establishes procedures to ensure eligible recipients move from Medi-Cal and other insurance affordability programs, like the California Health Benefit Exchange (Exchange), without any breaks in coverage. Specifically, this bill: 1)Prohibits, for individuals eligible to enrollee in a qualified health plan (QHP) through the Exchange, Medi-Cal benefits from being terminated until at least 30 days after the county sends the notice of action terminating Medi-Cal eligibility. 2)Requires the notice of action to inform an individual of the date by which he or she must select and enroll in a QHP to avoid being uninsured. Specifies that if an individual enrolls in a QHP before the notice of action termination date, Medi-Cal eligibility will be terminated at the QHP enrollment date. 3)Requires an individual's case to be run through the California Healthcare Eligibility, Enrollment, and Retention System (CalHEERS) when a QHP enrollee reports a change in circumstances, goes through the renewal process, or is reevaluated for eligibility and there is a change affecting AB 2077 Page 2 his or her eligibility for any insurance affordability program. Requires CalHEERS to send an individual's case file to his or her county of residence within three business days if CalHEERS receives information indicating that an individual enrolled in a QHP is newly eligible for Medi-Cal. Specifies that the county: a) Cannot treat the individual as a new Medi-Cal application; b) Must process case files received before the 15th of the month for final Medi-Cal eligibility by the end of that month and case files received after the 15th of the month by the 15th day of the following month; c) Issue a notice at least 15 days before the individual's QHP enrollment ends that advises the following: he or she will be Medi-Cal enrolled; instructions on how to select a Medi-Cal managed care plan; right to appeal QHP eligibility; and, instructions on how to request continued enrollment in a QHP pending the outcome of his or her appeal; d) Verify income, as specified; e) Must follow procedures for newly eligible Medi-Cal individuals. For Medi-Cal counties under the two-plan model or the geographic managed care plan model, the individual will be enrolled to either the available Medi-Cal managed care plan that has the same or substantially similar provider network to the QHP plan or to a plan using the usual Medi-Cal managed care default algorithm; f) Issue a 15 day notice to the individual and include: the assigned Medi-Cal managed care plan if the individual does not take any action; the individual choice of any available plan; description of available Medi-Cal managed care plans; and, instructions on how to change Medi-Cal AB 2077 Page 3 managed care plans; and, g) For counties under a county organized health system (COHS) to enroll an individual on the first date of Medi-Cal coverage and send the provider directory to the individual. EXISTING LAW: a)Establishes various programs to provide health care coverage to persons with limited financial resources, including the Medi-Cal program and the state's children's health insurance program (CHIP). b)Establishes the Medi-Cal program which is administered by the Department of Health Care Services (DHCS), under which qualified low-income persons receive health care benefits. Governs and funds the Medi-Cal program, in part, by federal Medicaid program provisions. Allows DHCS to exercise a specified federal option to extend continuous Medi-Cal eligibility to children 19 years of age and younger. c)Establishes the Exchange, also referred to as Covered California (CoveredCa) within state government, as an independent public entity not affiliated with an agency or department, and requires the Exchange to compare and make available through selective contracting health insurance for individual and small business purchasers as authorized under the federal Patient Protection and Affordable Care Act (ACA). Specifies the powers and duties of the board governing the Exchange, and requires the board to facilitate the purchase of qualified health plans though the Exchange by qualified individuals and small employers. d)Requires the board to determine the criteria and process for eligibility, enrollment, and disenrollment of enrollees and potential enrollees in the Exchange and coordinate that process with state and local government entities administering other specified health care coverage programs, as specified AB 2077 Page 4 e)Requires an individual to be provided the option to apply for insurance affordability programs in person, by mail, online, by telephone, or by other commonly available electronic means. f)Defines "insurance affordability programs" to include the Medi-Cal program, CHIP, and a program that makes available to qualified individuals coverage in a QHP through the Exchange with advance payment of the premium tax credit established under the Internal Revenue Code and cost-sharing reduction under federal law. g)Requires an entity making eligibility determination for an insurance affordability program to ensure than an eligible applicant and recipient of the program meets all program eligibility requirements and complies with all necessary requirements for information without any breaks in coverage and without being required to provide any forms, documents, or other information or undergo verification that is duplicative or otherwise unnecessary. FISCAL EFFECT: This bill has not yet been analyzed by a fiscal committee. COMMENTS: 1)PURPOSE OF THIS BILL. The sponsor, Western Center on Law and Poverty (WCLP), states that under the existing presumptive eligibility process, most people do not have a break in coverage during which they are uninsured. However, a change in policy at the state level may result in individuals being required to stay in CoveredCa until they have their Medi-Cal eligibility determined while paying premiums for commercial coverage. Furthermore, DHCS selects the Medi-Cal plan based on their QHP plan, even when networks are different and without giving the individual a choice of plan. Unlike Medi-Cal, CoveredCa coverage cannot begin until the individual has chosen a QHP plan. According to the sponsor, individuals AB 2077 Page 5 whose Medi-Cal coverage are ending are not told to choose a CoveredCa plan before the end of the month to avoid a break in coverage. 2)BACKGROUND. a) Federal Poverty Level (FPL). FPL is a measure of income level issued annually by the Department of Health and Human Services to determine eligibility for certain programs and benefits. Medi-Cal is available to all individuals who qualify on the basis of income up to 138% of the FPL and all children (up to age 19) whose family's income is at or under 266% of the FPL. Families who enroll in the Exchange with income below 266% of the FPL must enroll their children in Medi-Cal or enroll their children into a separate commercial plan. b) CoveredCa. The Exchange does not change how existing state health care coverage programs are administered. Medi-Cal continues to be administered by the DHCS. Federal law requires state exchanges to perform the function of screening for and enroll individuals in Medi-Cal. The Exchange coordinates with DHCS and California counties to ensure that individuals are seamlessly transitioned between coverage programs if their eligibility changes. c) CalHEERS. CalHEERS is the computer system behind the Exchange and is sponsored by CoveredCa and DHCS. It is a computer program that allows prospective consumers to enter their personal and income data and receive information about plans they are eligible for and what they cost. It also determines preliminary eligibility for Advanced Premium Tax Credits, Modified Adjusted Gross Income (MAGI) Medi-Cal, and Non-MAGI Medi-Cal. d) Enrollment. Consumers who experience a qualifying life event can enroll in a CoveredCa health insurance plan even outside of the open-enrollment period. This is called special enrollment and includes income changes in which a AB 2077 Page 6 consumer becomes newly eligible or ineligible for help paying for their insurance. Medi-Cal enrollment is year-round. e) Existing transition procedures. While existing law already requires transitions between CoveredCa and Medi-Cal without a break in coverage, this bill provides for specificity with respect to notice requirements for newly eligible members. Unlike Medi-Cal, CoveredCa coverage cannot begin until the individual has chosen a QHP, however it appears as if current notices are insufficient to advise individuals that they need to choose a QHP before the end of the month to avoid a break in health coverage. This bill also requires CalHEERS to send an individual's case file within a specific time if CalHEERS receives information indicating that an individual is newly eligible for Medi-Cal. 3)SUPPORT. WCLP, the sponsor of this bill, states that while existing law requires transitions between Medi-Cal and CoveredCa without a break in coverage, there needs to be more specific processes to ensure that the transitions work. WCLP writes that the state is changing its current processes and even when someone loses their job and reports it to CoveredCa, they would have to stay on and keep paying for their current coverage, rather than moving over to Medi-Cal. WCLP contend that individuals should be informed of their option to choose their own plan instead of Medi-Cal enrolling individuals into a Medi-Cal plan based on their QHP plan. Additionally, WCLP notes that this bill would give consumers notice at least 30 days before Medi-Cal termination to allow time for consumers to choose and enroll in a QHP plan. Finally, WCLP and the Asian Law Alliance contend that this bill will put policies in place to ensure that when someone's income fluctuates they could move into their new program without becoming uninsured. The California Black Health Network states that this bill will AB 2077 Page 7 ease the transition for consumers and will ensure that no Californian falls through the coverage gap. The California Immigrant Policy Center contends that while the transitions between Medi-Cal and CoveredCa are supposed to happen without a break in coverage, many people are ending up uninsured which means that low and moderate income Californians who are eligible for health coverage are going without care. 4)RELATED LEGISLATION. AB 1839 (Patterson) allows families in which adults are eligible for subsidized coverage via the Exchange to enroll children eligible for Medi-Cal coverage in the same Exchange product. AB 1839 is pending in Assembly Health Committee. 5)PREVIOUS LEGISLATION. a) AB 1296 (Bonilla), Chapter 641, Statutes of 2011, enacts the Health Care Reform Eligibility, Enrollment, and Retention Planning Act (Act), which would require the California Health and Human Services Agency (CHHSA), in consultation with specified entities, to establish standardized single, accessible application forms and related renewal procedures for state health subsidy programs, as defined, in accordance with specified requirements. AB 1296 specifies the duties of the CHHSA and DHCS under the Act, and requires CHHSA to provide specified information to the Legislature by July 1, 2012, regarding policy changes needed to implement the Act. b) SB 970 (De León) of 2012 would have provided for a workgroup of county staff, advocates, legislative staff, and other specified representatives to consider the feasibility, costs, and benefits of integrating application and renewal processes for additional human services and work support programs with the single stated application. SB 970 was vetoed by the Governor who indicated that "this bill is well-intentioned but overly prescriptive in its requirements. Codifying another workgroup and requiring another report are not necessary." AB 2077 Page 8 6)POLICY COMMENT. Currently, CoveredCa and DHCS are conducting stakeholder workgroups to address concerns with QHP and Medi-Cal transitions. This bill will assist with codifying specific requirements with respect to timing issues and notice language to ensure that eligibility requirements are met without any break in coverage. REGISTERED SUPPORT / OPPOSITION: Support Western Center on Law and Poverty (sponsor) Advancing Justice California Asian Law Alliance California Black Health Network California Immigrant Policy Center Central California Legal Services, Inc. Consumers Union Health Access California AB 2077 Page 9 Justice in Aging Legal Aid Society of San Mateo Legal Services of Northern California National Health Law Program Project Inform Opposition None on file. Analysis Prepared by:Kristene Mapile / HEALTH / (916) 319-2097 AB 2077 Page 10