BILL ANALYSIS Ó
AB 2345
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Date of Hearing: April 12, 2016
ASSEMBLY COMMITTEE ON HEALTH
Jim Wood, Chair
AB 2345
(Ridley-Thomas) - As Amended March 18, 2016
SUBJECT: Commission on Health Care Cost Review.
SUMMARY: Creates the Commission on Health Care Cost Review
(Commission) to study and analyze public policies relating to
health care costs and access to health care coverage.
Specifically, this bill:
1)Creates the Commission consisting of five members, in which
three members are appointed by the Governor, one member is
appointed by the Senate Committee on Rules, and one member is
appointed by the Speaker of the Assembly. Specifies that each
member will serve a term of four years and each member will
not receive compensation.
2)Requires the Commission to study and analyze public policies
affecting health care costs and access to health care coverage
in California and report its findings to the Assembly and
Senate Committees on Health every two years in a report, as
specified.
3)Allows the Department of Managed Health Care (DMHC) to accept
voluntary contributions to pay for the costs of operation of
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the Commission and such voluntary contributions will be
deposited into the Health Care Affordability Fund, which is
created in the State Treasury, as specified. Requires that
implementation of the Commission is contingent upon a
determination by the DMHC that sufficient voluntary
contributions exist or will exist in the Health Care
Affordability Fund.
EXISTING LAW:
1)Establishes the California Health Benefit Review Program
(CHBRP) to assess legislation that proposes to mandate or
repeal a mandated health benefit or service.
2)Regulates health plans under the Knox-Keene Health Care
Service Plan Act of 1975 through the DMHC and regulates health
insurers under the Insurance Code through the California
Department of Insurance.
3)Establishes various programs relating to health policy and
planning, including the Advisory Committee on Managed Health
Care and the Clinical Advisory Panel in the DMHC.
FISCAL EFFECT: This bill has not yet been analyzed by a fiscal
committee.
COMMENTS:
1)PURPOSE OF THIS BILL. According to the author, legislators do
not have adequate information to respond to the myriad of
policy concerns regarding the health care industry. Consumers
are faced with difficulties in finding a contracted provider.
The author contends that providing the Legislature with timely
analysis of those accessibility issues and related
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recommendations as well as information about the types of
policies available and how they affect price would give policy
makers a holistic understanding of this complicated area so
they can make better decisions for their constituents. The
author also states that this bill is necessary so members of
the legislature can better understand the larger policy
context of the health care industry so they can make informed
decisions about particular aspects of the system. For
example, as recent changes to the federal and state health
care system are still working their way through down to
consumers, issues related to the cost of coverage and access
to services still plague many communities. The author states
that the intent of this bill is to identify the cause of these
and other larger issues so meaningful and direct action can be
taken by the legislature.
The author notes that some may argue that this bill
establishes a Commission to perform the same functions as
CHBRP, however the author notes that the aim of the Commission
is to provide a comprehensive analysis of any policy affecting
health care cost and access to coverage and make related
recommendations to improve those areas. According to the
author, CHBRP does not provide policy recommendations. CHBRP
provides valuable information; however its conclusions are
academic in nature and only relate to pending legislation.
The information provided by the Commission would go beyond
pending legislation proposing to mandate or repeal a benefit
or service to address things including, but not limited to,
gaps in access, regional trends, healthy communities, and
social determinants of health and provide related policy
recommendations.
2)BACKGROUND.
a) CHBRP. Existing law establishes CHBRP to assess
legislation that proposes to mandate or repeal a mandated
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health benefit or service. It also requests the
University of California to provide the analysis to the
appropriate policy and fiscal committees of the Legislature
within 60 days after receiving a request for the analysis.
This analysis would include relevant data discussing
impacts to public health, medical and financial, as
specified. SB 125 (Hernandez), Chapter 9, Statutes of
2015, expanded this request to include impacts on essential
health benefits and on the California Health Benefit
Exchange in the analysis prepared under the program. SB
125 further requested that the University of California
assess legislation that impacts health insurance benefit
design, cost sharing, premiums, and other health insurance
topics. SB 125 extended the operative date of the program
and the fund, including the annual charge on health care
service plans and health insurers, to June 30, 2017 and
would repeal the described provisions as of January 1,
2018.
b) Little Hoover Commission. The Little Hoover Commission
(Commission) on California State Government Organization
and Economy, is an independent state oversight agency that
was created in 1962. Its mission is to investigate state
government operations - through reports recommendations and
legislative proposals - promote efficiency, economy and
improved service. The Commission selects study topics from
citizens, legislators and other sources and explore how
programs could and should function in today's world. The
Commission also produces in-depth, well-documented reports
that serve as a factual basis for crafting effective reform
legislation.
c) Covered California and Other States. California's
Health Benefit Exchange (also referred to as Covered
California) is currently considering amendments to its
Qualified Health Plan (QHP) contracts with QHP issuers to
develop and implement policies and practices that will
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promote the Triple Aim (seeking to lower costs, improve
quality, and improve health outcomes), impacting not just
the enrollees of Covered California but the QHP's entire
California membership. Based upon the description of this
amendment, QHP Issuers have the opportunity to take a
leading role in helping Covered California support new
models of care which promote the vision of the Affordable
Care Act and meet consumer needs and expectations.
In Colorado, the Colorado Commission on Affordable Health
Care has a three year mission to analyze health care costs
and make policy recommendations to its Legislature and
governor for lowering health care costs in the state. The
Colorado Commission is expected to complete its work and
submit a report to the Colorado General Assembly and
Governor's Office in late 2017.
In Massachusetts, the Massachusetts Health Policy
Commission (HPC) is an independent state agency that
develops policy to reduce health care cost growth and
improve the quality of patient care. The HPC's mission is
to advance a more transparent, accountable, and innovative
health care system through its independent policy
leadership and investment programs. The HPC's goal is
better health and better care at a lower cost across the
Commonwealth. The HPC's main responsibilities include
monitoring the performance of the health care system;
analyzing the impact of health care market transactions on
cost, quality, and access; setting the health care cost
growth benchmark; and, investing in community health care
delivery and innovations.
In Maryland, the Health Services Cost Review Commission
(HSCRC) is an independent state agency with seven
Commissioners appointed by the Governor. The HSCRC was
given broad responsibility regarding the public disclosure
of hospital data and operating performance and was
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authorized to establish hospital rates to promote cost
containment, access to care, equity, financial stability
and hospital accountability.
3)SUPPORT. The California Primary Care Association states that
it is important to fully understand how to improve access to
care and this commission is one way to achieve this goal.
4)PREVIOUS LEGISLATION. AB 1801 (Pacheco) introduced in 2002
would have created the Commission on Health Care Cost Review
and would have required the commission to study and report to
the Legislature and the Department of Finance on specified
matters, including the public policies affecting health care
costs and access to health care coverage in California. AB
1801 was never heard in the Health Committee.
5)RELATED LEGISLATION.
a) SB 1159 (Hernandez) would require the Secretary of
California Health and Human Services to convene an advisory
committee composed of a broad spectrum of health care
stakeholders and experts, as specified, to, among other
things, develop the parameters for establishing,
implementing, and administering a health care cost and
quality database. SB 1159 would require the secretary to
arrange for the preparation of an annual report to the
Legislature and the Governor that examines and addresses
specified issues, including, among others, containing the
cost of health care services and coverage. SB 1159 would
provide that members of the committee not receive a per
diem or travel expense reimbursement, or any other expense
reimbursement. Currently pending in Senate Health
Committee.
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b) AB 1764 (Waldron) would additionally request the
University of California to include as part of its CHBRP
financial impact analysis, relevant data on the impact of
coverage or repeal of coverage of the benefit or service on
anticipated costs or savings estimated upon implementation
for the two subsequent state fiscal years and, if
applicable, for the five subsequent state fiscal years, as
specified. Currently pending in Assembly Health Committee.
6)POLICY COMMENTS. This bill would create a Commission to study
and analyze public policies affecting health care costs and
access to health care coverage in California and will report
its findings to the Assembly and Senate Committees on Health
every two years in a report. The Health Committee may want
the author to address the following:
a) Scope of the Commission's review and whether the
Commission is tasked with a specific issue like Colorado or
meant to address issues that arise from legislation or
questions from the Assembly and Senate Committees on Health
and whether the Commission acts as an advisory committee.
b) Report requirements, if any, and whether this
information should include clinical studies, actuarial
information, or information from different stakeholders.
c) Commission members' background and expertise, if any.
d) Impact of report findings, specifically with respect to
the authority of the Commission and how the report or the
Commission impacts pending legislation or how bills are
introduced.
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e) How often should the Commission meet and will the
Commission have support staff.
f) Inclusion of a sunset clause of two years.
REGISTERED SUPPORT / OPPOSITION:
Support
California Primary Care Association
Opposition
None on file.
Analysis Prepared by:Kristene Mapile / HEALTH / (916) 319-2097
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