BILL ANALYSIS Ó AB 2077 Page 1 (Without Reference to File) ASSEMBLY THIRD READING AB 2077 (Burke and Bonilla) As Amended June 1, 2016 Majority vote ------------------------------------------------------------------ |Committee |Votes|Ayes |Noes | | | | | | | | | | | | | | | | |----------------+-----+----------------------+--------------------| |Health |18-0 |Wood, Maienschein, | | | | |Bonilla, Burke, Chiu, | | | | |Dababneh, Gomez, | | | | |Roger Hernández, | | | | |Lackey, Nazarian, | | | | |Olsen, Patterson, | | | | |Ridley-Thomas, | | | | |Rodriguez, Santiago, | | | | |Steinorth, Thurmond, | | | | |Waldron | | | | | | | |----------------+-----+----------------------+--------------------| |Appropriations |14-0 |Gonzalez, Bloom, | | | | |Bonilla, Bonta, | | AB 2077 Page 2 | | |Calderon, Daly, | | | | |Eggman, Eduardo | | | | |Garcia, Roger | | | | |Hernández, Holden, | | | | |Quirk, Santiago, | | | | |Weber, Wood | | | | | | | | | | | | ------------------------------------------------------------------ SUMMARY: Establishes procedures to ensure eligible recipients move from Medi-Cal and other insurance affordability programs, like the California Health Benefit Exchange (Exchange) or CoveredCA), without any breaks in coverage. Prohibits, for individuals eligible to enroll in a qualified health plan (QHP) through the Exchange, Medi-Cal benefits from being terminated until at least 20 days after the county sends the notice of action terminating Medi-Cal eligibility (Medi-Cal to CoveredCA transition) and is contingent to the extent that federal financial participation is available. Specifies procedures counties must follow to enroll individuals in Medi-Cal who are deemed ineligible for subsidized coverage through the Exchange due to income that appears to make them Medi-Cal eligible (CoveredCA to Medi-Cal transition). FISCAL EFFECT: According to the Assembly Appropriations Committee: 1)Uncertain Information Technology (IT) costs to the California Healthcare Enrollment, Eligibility and Retention System (CalHEERS) system (General Fund (GF)/federal/special), to the county-administered Statewide Automated Welfare System (SAWS), and to the Medicaid Eligibility Data System (GF/federal) to effectuate the policy changes. There is already a "change request" to these IT systems planned that will modify eligibility, enrollment and notifications. This change request could potentially be modified to accomplish the bill's requirements at little additional cost. To the extent this AB 2077 Page 3 bill would require IT changes beyond the scope of the current request, there could be additional costs. 2)This bill's requirements could result in unknown but large additional state cost pressure in Medi-Cal. The largest fiscal impact is associated with the creation of a grace period to move from Medi-Cal and enroll in a CoveredCA plan, where the state would pay for Medi-Cal coverage for a longer period of time in order to extend the window most consumers have to pick a CoveredCA plan. If even a portion of this projected 2 million stayed on Medi-Cal for an extra month while transitioning from Medi-Cal to CoveredCA, the state could experience cost in the millions of dollars or more (GF/federal). COMMENTS: 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, the Department of Health Care Services (DHCS) selects the Medi-Cal plan based on their QHP plan, even when networks are different. Unlike Medi-Cal, CoveredCA coverage cannot begin until the individual has chosen a QHP plan. According to the sponsor, individuals 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. Federal Poverty Level (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. AB 2077 Page 4 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. 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. 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 consumer becomes newly eligible or ineligible for help paying for their insurance. Medi-Cal enrollment is year-round. 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. 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 AB 2077 Page 5 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 and the Asian Law Alliance also 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. Analysis Prepared by: Kristene Mapile / HEALTH / (916) 319-2097 FN: 0003374