BILL ANALYSIS                                                                                                                                                                                                    



SENATE RULES COMMITTEE                           AB 1059  
Office of Senate Floor Analyses
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                        THIRD READING
                                                              
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Bill No:  AB 1059
Author:   Migden (D)
Amended:  9/4/97 in Senate
Vote:     21
                                                              
                                                             
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  SENATE INSURANCE COMMITTEE  :   6-3, 7/2/97
AYES:  Rosenthal, Hughes, Johnston, Peace, Schiff, Sher
NOES:  Johnson, Leslie, Lewis

  SENATE APPROPRIATIONS COMMITTEE  :   Senate Rule 28.8

  ASSEMBLY FLOOR  :  42-35, 6/2/97 - See last page for vote
                                                              
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SUBJECT :    Domestic partners

  SOURCE  :     The author
                                                              
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DIGEST  :    This bill requires health plans and health  
insurers that offer group coverage benefits to the  
dependents of an employee or subscriber to offer those  
benefits on the same terms to a domestic partner, as  
specified.

  Senate Floor Amendments  of 9/4/97 delete the definition of  
"domestic partners" used for the purpose of determining  
eligibility for domestic partner coverage by a health plan  
or a health insurer.

  ANALYSIS  :    Existing law:

1.Provides for health insurance and health care benefits to  
  spouses and dependents in a number of areas.






2.Prohibits discrimination based on marital status or  
  sexual orientation in a number of contexts, including  
  insurance.

This bill:

1.Requires health plans and health insurers that provide  
  group coverage to provide the same benefits to the  
  domestic partner of a subscriber or employee as they  
  provide to dependents, and subject to the same terms and  
  conditions.

2.Requires a health care service plan or a disability  
  insurer that provides hospital, medical or surgical  
  benefits for employees, subscribers or other persons  
  entitled to elect coverage and their dependents to enroll  
  as a dependent, upon application by the employer or group  
  administration, as a domestic partner or the employee,  
  subscriber or that other person.

3.Specifies that nothing in this bill is to be construed to  
  expand the requirements of federal law which were added  
  by the Consolidated Omnibus Budget Reconciliation Act of  
  1985.

  Background  :   In 1984, the City of Berkeley was the first  
employer in the country to offer benefits to the domestic  
partners of its employees.  In 1993, the Insurance  
Commissioner convened a task force to address the problem  
of unfair insurance discrimination against unmarried  
consumers.  The Task Force report pointed out the  
discrimination that exists, and recommended recognition of  
domestic partnerships for insurance purposes.  Now over 500  
employers, including cities, states, universities, and  
private sector businesses, for example, IBM, Apple  
Computer, Disney, Bank of America, Genentech, Orrick, Time  
Warner and, most recently, the San Francisco 49ers, provide  
such benefits.

However, while many health plans offer this coverage to  
large employers, they often deny the benefit to smaller  
employers, with Kaiser being a notable exception.  There  
appears to be no economic basis for excluding this  
coverage.  In a number of cases, employers and insurers  
initially included a surcharge on domestic partnership  
coverage to address any potential adverse economic impact.   
Such surcharges have almost universally been dropped as  
experience shows that costs for domestic partners are  
nearly identical to costs for spousal coverage.  Employer  





fears of huge numbers of fraudulent claims also proved  
groundless.

  FISCAL EFFECT  :   Appropriation:  No   Fiscal Com.:  Yes    
Local:  Yes

  SUPPORT  :   (Verified 9/5/97)

Aids Project Los Angeles
California Church IMPACT
California Labor Federation, AFL-CIO
California Nurses Association
California Optometric Association
California School Employees Association
California Teachers Association
California Women's Law Center
City of Berkeley
City and County of San Francisco
Clergy:
     John P. Bingham, Samaritan Counseling Center
     Vincent Brady, Cathedral of the Blessed Sacrament
     Donald G. Brown, Trinity Episcopal Cathedral
     Carol M. Carter, Wesley United Methodist, First United  
Methodist
     Catherine M. Campbell, Hispanic Office, Episcopal  
Diocese of Northern California, La Mission Hispana el  
Divino Salvador
     Barry F. Cavaghan, United Campus Ministry
     Steven Fietz, First Christian Church
     George E. Herbert, Westminster Presbyterian Church
     George K. Meier, Pioneer Congregational Church
     Jay K. Pierce, Central united Methodist Church
     Carlos Schneider, St. John's Lutheran Church
Congress of California Seniors
East Bay Municipal Utility District
Kaiser Permanente Medical Care Program
LIFE Lobby
Older Women's League of California
Santa Barbara Stonewall Democratic Club
Spectrum Institute
Unity Pride Coalition of Ventura County

  OPPOSITION  :    (Verified 9/5/97)

Capitol Resource Institute
Committee on Moral Concerns

  ARGUMENTS IN SUPPORT  :    According to the author's office,  
this bill was introduced to address the health insurance  
concerns of unmarried couples.  The Unruh Civil Rights Act,  





as well as an explicit regulation applicable to the  
business of insurance, prohibits discrimination based on an  
individual's marital status or sexual orientation.  Yet  
some health plans currently offer benefits to spouses that  
are not available to a person's unmarried partner.  This  
problem is particularly acute for same-sex couples who  
cannot have their relationships recognized as marriages.   
Elderly couples who form committed and exclusive  
relationships share a similar problem.  This bill helps  
resolve the current inequity in law with respect to health  
benefits.  Unmarried couples will not be denied access to  
health benefits for their partners solely because of their  
sexual orientation or marital status.

The author argues that more than a decade of experience  
with domestic partnership demonstrates that it is both  
pro-civil rights and pro-business.  A fast-growing list of  
businesses is now offering domestic partner benefits to  
their employees, including some insurance companies.  It is  
mostly smaller businesses that this bill would assist,  
which is why the bill is intended to cover the Health  
Insurance Plan of California.  The author acknowledges  
moral differences in the discussion of domestic  
partnership, and concerning same-sex couples in particular,  
but points out that nearly all religious denominations are  
re-examining their position.

Supporters present legal, health, social, religious and  
economic arguments in favor of the measure.  On economic  
grounds, Spectrum Institute (SI) notes that virtually all  
the business-centered fears initially expressed about  
domestic partnership have failed to materialize. Experience  
has shown that the cost of providing domestic partner  
benefits is the same as or less than that of providing  
spousal benefits.

Smaller employers who want to compete for employees have a  
hard time finding insurers who will offer this coverage.   
The City and County of San Francisco cites the difficulties  
employers face in offering domestic partner health coverage  
because it is unavailable or too expensive.  SI notes that  
this bill will make it easier for small businesses to  
compete for a valuable pool of employees.

Citing religious reasons in support, clergy from both the  
Protestant and Roman Catholic communities note that both  
the Old and New Testaments recognize a number of family  
forms.  They argue it is possible to support the bill on  
moral, and specifically, on Biblical grounds.  Moreover,  
they maintain that it is fundamentally just and right that  





all persons have access to health coverage.  The Life Lobby  
and the California Nurses Association emphasize the social  
importance of partnership to provide mutual protection.   
Because of the inability to enter a recognized marriage  
under state law, committed same-sex couples have long  
struggled within the legal system to protect one another.   
The societal expectation that, when one partner has a job,  
the other will be covered for health costs breaks down with  
same-sex couples.  This not only creates hardships for both  
partners, but exacts a cost to the state.  The state may be  
called upon to pick up the costs for the uninsured domestic  
partner.  Various supporters also present the legal  
argument that this bill is a matter of civil rights and  
equal protection under the law.

  ARGUMENTS IN OPPOSITION  :    The Committee on Moral Concerns  
opposes the bill, emphasizing five points.  First,  
homosexual couples are simply friends, and should not be  
viewed as dependent on one another irrespective of their  
own assessment of the importance, intimacy and permanency  
of their relationship.  Second, heterosexual couples who  
are unwilling to commit to a marital relationship should  
not be given taxpayer recognition.  Third, roommates might  
sign up for these benefits, and the constitutional right to  
privacy would prevent the government from determining  
whether their relationship was more than just casual.   
Fourth, the cost to employers of domestic partnership  
benefits would result in lower wages, higher prices, loss  
of jobs and insurance coverage for other workers.  Fifth,  
the historical family arrangement works best for society.   
The Capitol Resource Institute opposes this bill because it  
would force insurance companies to offer domestic partner  
benefits to employers, which they can already do.

  ASSEMBLY FLOOR  :
AYES:  Alquist, Aroner, Bowen, Brewer, Brown, Caldera,  
  Cardenas, Cunneen, Davis, Ducheny, Escutia, Figueroa,  
  Firestone, Floyd, Gallegos, Hertzberg, Honda, Keeley,  
  Knox, Kuehl, Kuykendall, Lempert, Martinez, Mazzoni,  
  Migden, Murray, Napolitano, Ortiz, Papan, Perata, Scott,  
  Shelley, Strom-Martin, Sweeney, Thomson, Torlakson,  
  Villaraigosa, Vincent, Wayne, Wildman, Wright, Bustamante
NOES:  Ackerman, Aguiar, Alby, Ashburn, Baldwin, Battin,  
  Baugh, Bordonaro, Bowler, Campbell, Cardoza, Frusetta,  
  Goldsmith, Granlund, Havice, House, Kaloogian, Leach,  
  Leonard, Margett, McClintock, Miller, Morrissey, Morrow,  
  Olberg, Oller, Pacheco, Poochigian, Prenter, Pringle,  
  Runner, Takasugi, Thompson, Washington, Woods
NOT VOTING:  Baca, Machado, Richter







DLW:ctl  9/5/97  Senate Floor Analyses
              SUPPORT/OPPOSITION:  SEE ABOVE
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