BILL ANALYSIS
AB 794
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ASSEMBLY THIRD READING
AB 794 (Chu)
As Amended March 29, 2005
Majority vote
GOVERNMENTAL ORGANIZATION 9-5
--------------------------------
|Ayes:|Jerome Horton, Bermudez, |
| |Calderon, Chavez, Coto, |
| |Liu, Negrete McLeod, |
| |Torrico, Yee |
| | |
|-----+--------------------------|
|Nays:|Plescia, Aghazarian, |
| |Garcia, La Suer, Mountjoy |
| | |
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SUMMARY : Provides that health care contracts shall be open to
inspection by the Legislative Analyst's Office (LAO). Makes
other technical changes.
EXISTING LAW :
1)Requires public agencies to make its records available for
public inspection unless specific exemptions apply.
2)Provides that records relating to the negotiation of contracts
for health coverage entered into by the state with health
plans under specified programs generally are exempt from
disclosure but that those contracts, except for rates, shall
be open to public inspection one year after being executed,
and the rates in those contracts shall be open to public
inspection three years after being executed.
3)Provides that, notwithstanding these provisions, each entire
contract shall be open to inspection by the Joint Legislative
Audit Committee.
FISCAL EFFECT : Unknown
COMMENTS :
1)Purpose of the bill: This bill would allow LAO to inspect
AB 794
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contract rates of health plans entered into with the Managed
Risk Medical Insurance Board (MRMIB). Records include rates
of payment from the state to health plans, and MRMIB's
discussions, communications, or any other portion of the
negotiations with health plans. AB 794 is intended to build
upon provisions of SB 1103 (Budget and Fiscal Services
Committee), Chapter 228, Statutes of 2004, the health budget
trailer bill to implement the health-related statutory changes
for the 2004 Budget Act, by furthering legislative oversight
of MRMIB's programs.
2)Background: The California Public Records Act generally
provides that public agencies make their records available for
public inspection. Certain records are exempt from disclosure
to the public and LAO. Contracts with health plans entered
into by MRMIB for the Healthy Families Program, the Major Risk
Medical Insurance Program (MRMIP), and the Access for Infant
and Mothers (AIM) Program are not open to public inspection
until one year after the contract has been executed, and the
portion of the contract containing the rates of payment are
not open until three years after the contract has been open to
public inspection.
SB 1103 requires LAO access to hospital and certain managed care
contracts negotiated by the California Medical Assistance
Commission for the Medi-Cal program. SB 1103 requires LAO to
maintain the confidentiality of the contracts and contract
amendments until the contract or amendment is fully open to
inspection by the public. LAO serves as the "eyes and ears"
for the Legislature to ensure that the executive branch is
implementing legislative policy in a cost efficient and
effective manner, and by reviewing and analyzing the
operations and finances of state government.
3)Arguments in support: According to the author, MRMIB
currently enters into contracts with 41 health, dental, and
vision plans in the Healthy Families Program, four contracts
with health plans in MRMIP and seven contracts with health
plans in AIM. The Governor's 2005-06 Budget projects spending
for Healthy Families Program to be approximately $328 million
from the General Fund. Granting LAO early access to these
contracts will better enable LAO to assess the operation of
these programs and would further legislative oversight of
these vitally important programs.
AB 794
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Analysis Prepared by : Chris Lindstrom / G. O. / (916)
319-2531
FN: 0009852