BILL ANALYSIS Ó
SENATE COMMITTEE ON HEALTH
Senator Ed Hernandez, O.D., Chair
BILL NO: AB 2077
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|AUTHOR: |Burke |
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|VERSION: |June 1, 2016 |
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|HEARING DATE: |June 22, 2016 | | |
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|CONSULTANT: |Scott Bain |
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SUBJECT : Health Care Eligibility, Enrollment, and Retention Act
SUMMARY : Prohibits Medi-Cal benefits from being terminated until at
least 20 days after the county sends the notice of action
terminating Medi-Cal eligibility if the individual is eligible
to enroll in a qualified health plan through Covered California,
to the extent federal financial participation is available.
Establishes application processing timelines for counties for
individuals who were enrolled in Covered California and who are
determined newly eligible for Medi-Cal through the application
processing system known as the California Healthcare
Eligibility, Enrollment and Retention System.
Existing federal law
1)Requires, under the Patient Protection and Affordable Care Act
(ACA, Public Law 111-148), as amended by the Health Care
Education and Reconciliation Act of 2010 (Public Law 111-152),
each state to establish an American Health Benefit Exchange
that makes qualified health plans (QHP) available to qualified
individuals and qualified employers. Requires, if a state does
not establish an Exchange, the federal government to
administer the Exchange.
2)Allows through the ACA, eligible individual taxpayers whose
household income equals or exceeds 100%, but does not exceed
400% of the federal poverty level (FPL), an advanceable and
refundable tax credit (APTC) for a percentage of the cost of
premiums for coverage under a QHP offered in the Exchange. The
ACA requires a reduction in cost-sharing for individuals with
incomes below 250% of the FPL, and a lower maximum limit on
out-of-pocket expenses for individuals whose incomes are
between 100% and 400% of the FPL.
AB 2077 (Burke) Page 2 of ?
Existing state law:
1)Establishes the California Health Benefit Exchange (known as
Covered California) in state government, and specifies its
duties and authority. Requires Covered California to be
governed by a board that includes the Secretary of the
California Health and Human Services Agency and four members
with specified expertise who are appointed by the Governor and
the Legislature.
2)Establishes the Medi-Cal Program, administered by the
Department of Health Care Services (DHCS), which provides
comprehensive health benefits to low-income children up to
266% of the FPL, parents and adults under age 65 up to 138% of
the FPL, pregnant women, and elderly, blind or disabled
persons, who meet specified eligibility criteria.
3)Requires, during the processing of an application, renewal, or
a transition due to a change in circumstances, an entity
making eligibility determinations for an insurance
affordability program (such as Medi-Cal or Covered California)
to ensure that an eligible applicant and recipient of
insurance affordability programs that meets all program
eligibility requirements and complies with all necessary
requests for information moves between programs without any
breaks in coverage.
4)Requires counties, for individuals determined ineligible for
Medi-Cal by a county following the redetermination procedures,
eligibility to be determined for other insurance affordability
programs. Requires the county, if the individual is found to
be eligible, to transfer the individual's electronic account
to other insurance affordability programs via a secure
electronic interface.
5)Requires county social service departments to notify
beneficiaries in writing of their Medi-Cal-only eligibility or
ineligibility, and of any changes made in their eligibility
status or share of cost. These notifications are called a
"Notice of Action (NOA)." NOAs inform Medi-Cal beneficiaries
of:
a) Any approval, denial or discontinuance of
eligibility;
b) A change in the beneficiary's share of cost;
c) The reason an action is being taken and the law or
AB 2077 (Burke) Page 3 of ?
regulation that requires the action (if the action is a
denial, discontinuance or increase in share of cost);
and,
d) The right to request a state hearing.
This bill:
1)Prohibits Medi-Cal benefits from being terminated until at
least 20 days after the county sends the NOA terminating
Medi-Cal eligibility if the individual is eligible to enroll
in a QHP through Covered California.
2)Requires the NOA to inform the individual of the date by which
he or she must select and enroll in a QHP through the Exchange
to avoid being uninsured.
3)Requires Medi-Cal eligibility to be terminated as of the date
of enrollment in the QHP if the individual has effectuated his
or her enrollment in a QHP through Covered California before
the termination date specified in the notice.
4)Implements paragraphs 1) through 3) above only to the extent
that federal financial participation is available.
5)Requires, if an individual who has been enrolled in a QHP
through Covered California is determined newly eligible for
Medi-Cal through the California Healthcare Eligibility,
Enrollment and Retention System (CalHEERS), the individual's
case information and eligibility determination to be sent to
his or her county of residence within three business days.
(CalHEERS is the on-line application system administered by
Covered California and DHCS.)
6)Requires cases received by the county prior to the 15th day of
the month to be processed for final Medi-Cal eligibility by
the county by the end of that month.
7)Requires cases received by the county after the 15th day of
the month to be processed for final Medi-Cal eligibility by
the 15th day of the following month.
8)Requires, for an individual who is newly eligible for
Medi-Cal, in a county that provides Medi-Cal services under
the two-plan model or the geographic managed care plan model,
the individual to be enrolled in a Medi-Cal managed care plan
according to either of the following:
AB 2077 (Burke) Page 4 of ?
a) Requires, if the QHP the individual was enrolled
in through the Covered California is an available
Medi-Cal managed care plan in his or her county and
that plan has the same or substantially similar
provider network, the individual to be assigned to
that plan; or,
b) Requires the individual to be assigned to a plan
using the usual Medi-Cal managed care default
algorithm.
1)Requires, for an individual who is newly eligible for
Medi-Cal, in a county that provides Medi-Cal services under a
county organized health system (COHS), the individual to be
enrolled into the COHS plan on the first date of Medi-Cal
coverage and to be sent the provider directory for the managed
care plan.
-States legislative intent to establish procedures to ensure
that individuals move between Medi-Cal and Covered California
without any breaks in coverage as required under a specified
provision of existing law.
FISCAL
EFFECT : According to the Assembly Appropriations Committee:
1)Uncertain Information Technology (IT) costs to 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
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 Covered California 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 Covered California plan. If even a portion of
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this projected 2 million stayed on Medi-Cal for an extra month
while transitioning from Medi-Cal to Covered California, the
state could experience cost in the millions of dollars or more
(GF/federal).
PRIOR
VOTES :
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|Assembly Floor: |80 - 0 |
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|Assembly Appropriations Committee: |14 - 0 |
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|Assembly Health Committee: |18 - 0 |
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COMMENTS :
1)Author's statement. According to the author, this bill eases
the transition between plans for those moving from Covered
California plans to Medi-Cal and vice versa. For individuals
moving from Medi-Cal to Covered California, they will have 20
days before their Medi-Cal benefits expire. Those moving from
Covered California to Medi-Cal will also have additional time
to select a plan, and receive guidance on how to select a
plan. By providing a coverage bridge for Californians
transitioning between plans, we can make sure that no one
falls through a coverage gap.
2)Transitions between coverage programs. Eligibility for
Medi-Cal and Covered California APTC and cost-sharing
subsidies are based in part on income. Most adults can qualify
for Medi-Cal with incomes up to 138% of the FPL ($33,534 a
year for a family of four in 2016) and children can qualify
with incomes up to 266% FPL ($64,638 for a family of four in
2016). People whose incomes are higher than these thresholds
can get health coverage through Covered California and can
qualify for subsidies with incomes up to 400% FPL ($97,200 for
a family of four in 2016). When an individual experiences a
change in income, they may move between the two programs.
These transitions can occur during the course of the year as a
result of a change in income, due to a change in the FPL, when
an individual has a change in family size, or at annual
eligibility redetermination. When an individual's income
AB 2077 (Burke) Page 6 of ?
increases or decreases, they can move from Medi-Cal to Covered
California or vice versa.
DHCS indicates (based on prior years' data), approximately
80,000 to 100,000 cases transitioned from Covered California
to Medi-Cal in the January timeframe, due to Covered
California's annual renewal period (which ends December 31st
of each year). An additional 5,000 to 10,000 cases transition
from Covered California to Medi-Cal on a monthly basis
throughout the remainder of the year, due to reported changes
in circumstances. Based on DHCS' data, on average 2,800 -
5,000 Medi-Cal cases transition each month to Covered
California.
Existing law already requires transitions between the programs
without a break in coverage. This bill establishes more
specific provisions on how transitions from Medi-Cal to
Covered California (and vice versa) will work, as follows:
a) Covered California to Medi-Cal. When an individual
moves from coverage in Covered California to Medi-Cal
through CalHEERS, this bill requires that case
information to be sent to their county of residence
within three business days (Covered California indicates
this information is transmitted immediately under current
practice).
Under existing law, counties receiving these cases have 45
days to make a Medi-Cal eligibility determination for
most cases. Under this bill, shorter timeframes would
apply for these individuals. Cases received by the county
prior to the 15th day of the month would have to be
processed for final Medi-Cal eligibility by the county by
the end of that month. Cases received after the 15th day
of the month would have to be processed for final
Medi-Cal eligibility by the 15th day of the following
month. The purpose of these shorter timeframes is so that
individuals are not required to incur premiums and
cost-sharing for Covered California coverage when they
are Medi-Cal eligible.
b) Medi-Cal to Covered California. When an individual
moves from Covered California to Medi-Cal, this bill
would prohibit Medi-Cal benefits from being terminated
until at least 20 days after the county sends a NOA
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terminating Medi-Cal eligibility. Under current law, NOAs
are sent 10 days prior to Medi-Cal eligibility being
discontinued. In addition, this bill would require
Medi-Cal eligibility to be terminated as of the date of
enrollment in the QHP in Covered California if the
individual has effectuated his or her enrollment in a QHP
through Covered California before the termination date
contained in the notice.
There are several reasons for this longer timeframe.
Because Medi-Cal coverage is a monthly basis, a notice
mailed mid-month would not meet the 20 day notice, so
Medi-Cal coverage would continue through the following
month. For example, if Medi-Cal coverage was discovered
to be discontinued on March 12, the 20 day notice
requirement would mean the coverage discontinuance would
not take effect until May 1st,(because the 20 day notice
would fall after the end of March). Under a 10 day NOA
requirement, the individual's coverage would terminate
April 1st. In addition, the 20 day notice provides an
individual a longer time period to select a QHP in
Covered California. To address DHCS' concern that this
would result in a state-only Medi-Cal cost for an
additional month of Medi-Cal coverage, this bill contains
language making this provision contingent upon FFP being
available.
In addition, this bill requires the NOA to inform the
individual of the date by which he or she must select and
enroll in a QHP through the Exchange to avoid being
uninsured. This provision addresses an issue with the
existing notices, which do not notify individuals of the
need for prompt action if they do not pick a QHP so as to
avoid a gap between when their Medi-Cal coverage ends and
their Covered California coverage begins. The notice
fixes are currently scheduled for implementation in
September 2016.
1)Prior legislation. AB 1296 (Bonilla, Chapter 641, Statutes of
2011) enacted the Health Care Eligibility, Enrollment and
Retention Act, requiring state entities who administer health
care coverage programs to undertake a variety of activities
related to eligibility, enrollment and renewal of health care
coverage through Medi-Cal.
AB 2077 (Burke) Page 8 of ?
2)Support. This bill is sponsored by Western Center on Law and
Poverty (WCLP) to put in place policies and procedures to
allow people moving between Medi-Cal and Covered California to
do so without being uninsured. WCLP writes that many people
moving between programs are ending up without health coverage
for one to several months despite an existing law provision
that requires that individuals be able to move between
programs without any breaks in coverage. During gaps in
coverage, individuals cannot get the care they need, or they
have to pay for care out-of-pocket, which many cannot afford.
WCLP argues that when people move from Covered California to
Medi-Cal, the state is planning to change its policy of
"presumptive eligibility" which enrolls them in Medi-Cal
quickly. WCLP states the effect of this change which will be
that people will have to say on Covered California while the
county makes a final Medi-Cal eligibility determination. WCLP
states this forces the person to pay premiums and cost-sharing
as if they had higher income when Medi-Cal coverage is free.
For individuals moving from Covered Coverage to Medi-Cal, WCLP
writes this bill would ensure their case is sent to the county
right away and is promptly determined. Finally, WCLP writes
that this bill would also ensure that individuals moving from
Medi-Cal to Covered California are being told they most choose
a Covered California plan to avoid a break in coverage, and
will allow consumers more time to choose and enroll in a
Covered California plan.
The Legal Aid Society of Orange County, Legal Services of
Northern California and the Legal Aid Society of San Mateo
County writes in support of this measure and cites cases they
have dealt with where individuals transitioning between
Medi-Cal and Covered California have had gaps in coverage, and
have suffered adverse health and financial consequences as a
result.
3)DHCS concerns. The problems with transitions between Covered
and Medi-Cal has been discussed with DHCS and Covered
California, and the improved notices regarding the need to
promptly pick a plan for new Covered California enrollees are
currently scheduled to take effect in the CalHEERS release in
September 2016. With regard to the 20 day NOA (instead of the
current 10 day NOA), DHCS indicates this change would treat
individuals in a transition differently than new applicants
for Medi-Cal coverage. This change would require changes to
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DHCS' existing infrastructure for a subset of individuals, and
is counter to DHCS' desire to treat individuals the same. If
the NOA timeframe were changed to 20 days for all Medi-Cal
beneficiaries, DHCS indicates this would have an impact on
Medi-Cal costs as more individuals would remain on the program
an additional month.
4)Author's amendment. The author is proposing to delete the
provisions in this bill that assign people moving from Covered
California to a Medi-Cal into a Medi-Cal managed care plan.
SUPPORT AND OPPOSITION :
Support: Western Center on Law and Poverty (sponsor)
American Cancer Society Cancer Action Network
Asian Americans Advancing Justice
Asian Law Alliance
California Black Health Network
California Pan-Ethnic Health Network
California Coverage and Health Initiatives
California Immigrant Policy Center
California Rural Legal Assistance, Inc.
California School Employees Association
Central California Legal Services, Inc.
Children Now
Children's Defense Fund
Children's Partnership
Coalition of Welfare Rights Organizations, Inc.
Congress of California Seniors
Consumers Union
Health Access California
Justice in Aging
Legal Aid Society of Orange County
Legal Aid Society of San Mateo County
Legal Services of Northern California
National Association of Social Workers, California
Chapter
National Health Law Program
Project Inform
Oppose: None received
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