BILL ANALYSIS Ó
SB 10
Page 1
Date of Hearing: May 18, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
SB 10
(Lara) - As Amended April 28, 2016
-----------------------------------------------------------------
|Policy |Health |Vote:|12 - 3 |
|Committee: | | | |
| | | | |
| | | | |
-----------------------------------------------------------------
Urgency: Yes State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill requires the Secretary of the California Health and
Human Services Agency (Agency) to apply for a federal waiver to
allow undocumented Californians to enroll in a form of
unsubsidized health care coverage through Covered California.
Upon approval of the waiver, Covered California would designate
"California qualified health plans (QHPs)," which are identical
to other qualified health plans offered, but able to be offered
to persons not otherwise eligible to purchase coverage from the
Exchange by reason of immigration status.
SB 10
Page 2
This bill also contains an urgency clause, indicating it is
necessary in order to request federal approval of the waiver to
expand access to health care coverage in California as quickly
as possible.
FISCAL EFFECT:
1)Minor and absorbable administrative costs to Covered
California to apply for the waiver. The Agency indicates
Covered California is the appropriate entity to submit the
waiver application (California Health Trust Fund).
2)Significant Information Technology (IT) costs to Covered
California, potentially in the millions. Costs include
planning, development, and testing of functionality to allow
for designation of undocumented status, and facilitate
enrollment into "California QHPs" (California Health Trust
Fund).
3)Potentially significant, unknown ongoing costs to Covered
California associated with additional enrollment and
maintenance of IT systems. Covered California also notes
implementation would need to include revisions to their
marketing campaign, to explain potentially confusing
differences in subsidies for families of mixed immigration
status.
COMMENTS:
1)Purpose. The author notes current federal law excludes
undocumented immigrants from being able to purchase coverage
through Covered California, even with their own resources.
SB 10
Page 3
This bill seeks to allow undocumented immigrants in California
to privately purchase, with no federal or state financial
assistance, health plans through Covered California, the
state's health insurance exchange. This bill is supported by
numerous health care, immigration, labor, and other advocacy
organizations and has no opposition.
2)Background. Under existing state and federal law, undocumented
adults who are otherwise income-qualified for Medi-Cal are not
eligible for full scope services, and are instead eligible for
"limited scope" Medi-Cal benefits. Limited scope services are
long-term care, pregnancy-related benefits, and emergency
services.
Undocumented immigrants are also prohibited from purchasing
coverage in Covered California under federal law, and are
ineligible for federal subsidies intended to make health
insurance and the cost of care more affordable. However,
California law requires health plans and insurers to make the
same plans and policies available inside and outside the
exchange, meaning the plans available for purchase through
Covered California are also offered outside on the
non-Exchange market.
3)Section 1332 Waivers and Recent State Work. The federal
Affordable Care Act (ACA) included a provision (Section 1332)
that allows certain ACA requirements to be waived in order to
pursue innovation. Section 1332 allows states to pursue broad
alternative approaches to expand coverage, or targeted changes
like the one proposed in this bill. Waivers must meet
several federal requirements related to affordability and
SB 10
Page 4
coverage and must not increase the federal deficit over 10
years. Federal guidance related to Section 1332 waivers was
released last year, and waivers can be effective as early as
January 1, 2017.
Earlier this year, CoveredCA engaged stakeholders to discuss
potential Section 1332 waiver proposals. This idea is one of
several 1332 waiver ideas proposed and evaluated by Covered
California. Of the ideas proposed, this appears to be among
the simplest operationally and does not raise significant
concerns about ongoing state or federal fiscal liability.
4)Implementation. Under this bill, Covered California would
request permission to waive the ACA requirements that an
exchange only offer QHPs, since these plans cannot be offered
to undocumented immigrants. If the waiver is approved, Covered
California will be permitted to create and offer California
QHPs that are not subject to immigration verification
requirements.
This bill requires such California QHPs be completely
identical to the plans offered in the subsidized and
unsubsidized market. However, Covered California will be
required to create a legally and technically distinct product
line, which would feature its own enrollment path and
eligibility requirements.
SB 10
Page 5
5)Staff Comments. Staff notes even with the ability to purchase
coverage through Covered California, coverage will still be
unaffordable for many. Furthermore, those who can afford it
can already purchase the same products outside the exchange.
However, Covered California has numerous beneficial features,
including shop-and-compare functions and the ability to
purchase family coverage. Allowing undocumented individuals
to purchase coverage through Covered California directly would
allow individuals to make use of these functions, could
encourage greater enrollment, and could benefit families of
mixed immigration status.
Analysis Prepared by:Lisa Murawski / APPR. / (916)
319-2081