BILL ANALYSIS AB 26 Page 1 Date of Hearing: May 12, 1999 ASSEMBLY COMMITTEE ON APPROPRIATIONS Carole Migden, Chairwoman AB 26 (Migden) - As Amended: April 8, 1999 Policy Committee: HealthVote:9 - 4 Urgency: No State Mandated Local Program:YesReimbursable: Yes SUMMARY : This bill requires health insurers to offer to employers the option to purchase coverage for domestic partners, according to the same terms and conditions by which the insurer makes available coverage for employee dependents. The bill also directs the Secretary of State to establish a statewide registry of domestic partners, thereby allowing insurers to verify domestic partnerships, and authorizes the office to charge a $10 fee to cover the cost of maintaining the registry. Separately, the bill requires health facilities to allow domestic partners of patients and patient family members access during visiting hours. FISCAL EFFECT : One-time cost to the Secretary of State of $118,000 in 1999-00 to establish the registry required by the bill, and costs of $50,000 to $60,000 annually thereafter. These costs would be fully offset by fees paid by registrants. In addition, the bill requires county clerk offices to make registration forms available to the public. County costs to do so would be minimal, but would be state reimbursable in the event they exceed $200 per county. COMMENTS : 1)Purpose of the Bill . According to the author, this bill is intended to facilitate domestic partners health insurance coverage for smaller employers. The author notes many large firms and the University of California now offer coverage to AB 26 Page 2 the domestic partners of employees for competitive reasons. However, the lack of widespread availability and rate discrimination are continue to pose barriers to smaller employers and individuals that may wish to purchase such coverage. According to the California Alliance for Pride and Equality, sponsor of the bill, the Unruh Civil Rights Act, the California Labor Code, and sections of the California Code of Regulations prohibit discrimination on the basis of sexual orientation and/or marital status. Yet some health plans currently offer benefits to married spouses that are not also offered for unmarried domestic partners. This problem is particularly acute for same-sex couples whose relationships are not currently recognized under existing law. The sponsor notes elderly couples who form committed and exclusive relationships but chose not to marry share a similar problem. 2)Larger Businesses Frequently Offer Domestic Partner Health Coverage . Nationally, more than 500 employers now provide some type of benefits for domestic partners. Among the major firms offering domestic partners coverage are American Express, Apple Computer, Chevron, Hewlett-Packard, IBM, Northwest Airlines, Pacific Gas & Electric, Sprint Communications, Time Warner, and Xerox. Several of California's largest insurers, including Health Net, Blue Cross, Blue Shield and PacifiCare, and Kaiser Permanente, already offer this elective coverage to their clients. 3)Opposition . The Committee on Moral Concern opposes the bill because it legalizes "pseudo marriages." Opponents argue gay and lesbian partners are not dependents and, moreover, that if heterosexual benefit are unwilling to commit to each other in a real marriage, state government should not commit to their relationship either. Finally, opponents argue domestic partnerships devalue true family commitments, lend an "air of legitimacy" to homosexuality, and therefore are "socially destructive." 4)Related Legislation . AB 1059 of 1998, also by this author, was substantially similar to this bill. In his veto message of AB 1059, the governor said: "Domestic partner health benefit coverage is an issue that is more appropriately left to negotiations between employers and employees. This coverage is available for both large and small employers who AB 26 Page 3 wish to provide the benefit, as evidenced by the many employers who choose to do so." 5)Proposed Amendments . The author proposes amendments to: Require health insurers to offer domestic partner health benefits as an optional coverage for policies sold to individuals. In its current form, the bill only applies only to policies sold to "group" purchasers. Direct the Health Insurance Plan of California, the state's small employer health insurance purchasing pool, to make available to employers plans covering domestic partners. Analysis Prepared by : William Wehrle / APPR. / (916) 319-2081