BILL ANALYSIS
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THIRD READING
Bill No: AB 115
Author: Beall (D), et al
Amended: 6/11/09 in Senate
Vote: 21
SENATE HEALTH COMMITTEE : 6-2, 5/20/09
AYES: Alquist, DeSaulnier, Leno, Negrete McLeod, Pavley,
Wolk
NOES: Strickland, Aanestad
NO VOTE RECORDED: Cedillo, Cox, Maldonado
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 79-0, 5/4/09 - See last page for vote
SUBJECT : Adult Health Coverage Expansion Program
SOURCE : Santa Clara Family Health Plan
DIGEST : This bill revises the Adult Health Coverage
Expansion Program (AHCEP) in Santa Clara County to allow
AHCEP to provide health care coverage products to employees
not currently eligible for the program and to the spouses,
domestic partners, and eligible children of program
enrollees.
ANALYSIS :
Existing law:
CONTINUED
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1.Provides, through the Knox-Keene Health Care Services
Plan Act (Knox-Keene Act), for the regulation of health
care service plans (health plans) by the Department of
Managed Health Care (DMHC), and sets requirements for
health plans pertaining to the provision of mandatory
basic services; financial stability; availability and
accessibility of providers; review of provider
contracts; cost sharing; and consumer disclosure and
grievance requirements.
2.Establishes the Medi-Cal program, which provides
comprehensive health care coverage to certain categories
of low-income eligible individuals and families,
including children, the aged, the blind, the disabled,
nursing home residents, refugees, and pregnant women.
3.Authorizes specified counties to establish local
initiatives, which are publicly managed health care
plans that provide managed care services to Medi-Cal
enrollees, and that also provide coverage for other
target populations.
4.Requires a local initiative to be governed and operated
by a special commission, or health authority, that are
established by, but are independent of, a county board
of supervisors. Existing law requires a local
initiative to be a plan licensed by DMHC, under the
provisions of the Knox-Keene Act.
5.Establishes the AHCEP to provide health care coverage to
eligible adults with incomes up to 350 percent of the
federal poverty level for a family of one, living and
employed in Santa Clara County, and who are without
health coverage.
6.Permits the AHCEP to be implemented as a pilot program
in Santa Clara County, and requires the Santa Clara
local initiative to administer the AHCEP.
7.Limits the eligibility for the AHCEP to adults 19 to 64
years of age, and additionally limits it to a maximum of
5,000 employees who are employed by a participating
small business for a minimum of 20 hours per week.
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8.Prohibits the employees' dependents, spouses, and
domestic partners from being eligible for AHCEP and
exempts the AHCEP from being subject to specified
provisions of the Knox-Keene Act related to small
employer group access to health plan contracts, except
as specified.
9.Defines, for the purposes of the AHCEP, a "small
business" and a "small employer" as an entity located in
Santa Clara County that employs 50 or fewer persons,
with at least 35 percent of the employees having an
individual income of less than 350 percent of the
federal poverty level for a family of one, which has not
offered health care coverage to its employees for at
least 12 consecutive months, provided that any prior
coverage required the employer to contribute at least 50
percent of the total amount of the premium.
10.Requires the AHCEP program coverage, to the extent
practical, be substantially similar to the benefits
offered to adults under the Health Families program, and
contain at least the basic services included in the
Knox-Keene Health Care Services Plan Act.
This bill:
1. Allows the AHCEP to provide health care coverage
products to spouses, domestic partners, and eligible
children of program enrollees.
2. Establishes that the expansion for spouses, domestic
partners, and eligible children of program enrollees
would be through a complementary product, as defined.
3. Expands the qualifying definition of eligible small
business to those with at least 25 percent of employees
who earn less than 350 percent of the federal poverty
level.
4. Repeals existing law applicable to the AHCEP which
requires premiums and co-payments for the program to be
established in a manner substantially similar to the
Healthy Families program.
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5. Permits complimentary products to have different
eligibility requirements and benefit designs than
coverage for employees.
6. Exempts complimentary products from being subject to
specified provisions of the Knox-Keene Act related to
small employer group health plan contracts, as well as
certain small group eligibility and participation,
requirements, except as specified.
7. Limits the requirement that the AHCEP, or any
complementary product offered to dependents, be
guaranteed renewable, only if the Santa Clara Family
Health Plan continued to offer the AHCEP pilot program.
8. Authorizes the AHCEP to include within what is
considered to be the premiums paid to the health plan
the value of hospital-based services provided to program
enrollees and apportioned to the employee.
9. Prohibits the use of state General Fund monies for
funding of AHCEP or any related complementary products.
Background
According to the California Employer Health Benefits
Survey, a joint project of the California HealthCare
Foundation (CHCF) and the National Opinion Research Center,
in 2008, the number of workers with health coverage from
the employer varied significantly by employer size, with
only seven percent of workers in firms with less than 10
employees covered; 17 percent in firms with 10-49
employees; and, 16 percent in firms with 50-1999 employees.
By contrast, 47 percent of workers in firms over 1,000
were covered.
The local initiative for Santa Clara County is the Santa
Clara Family Health Plan, a Knox-Keene licensed health plan
that currently provides coverage under the Medi-Cal,
Healthy Families, and Medicare programs. Compared to
California statewide averages, Santa Clara County ahs fewer
uninsured residents and a higher percentage of its
population covered by employment-based insurance.
Nonetheless, a significant number of Santa Clara County
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adults with incomes below 300 percent of the federal
poverty level lack health insurance. According to UCLA, at
the time they were surveyed in 2007, 31.6 percent of Santa
Clara County adults under age 65 with household incomes
under 300 percent of the federal poverty level
(approximately 114,000 people) were uninsured, while 38.2
percent had job-based coverage. As a comparison, for this
same population statewide, 32.6 percent were uninsured and
37 percent had job-based coverage.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 6/29/09)
Santa Clara Family Health Plan (source)
American Federation of State, County and Municipal
Employees, AFL-CIO
California Alliance for Retired Americans
Chamber of Commerce, City of Mountain View
Santa Clara County Board of Supervisors
ARGUMENTS IN SUPPORT : The Santa Clara Family Health
Plan, the sponsor of the bill, argues that the bill is
important to help provide universal coverage in Santa Clara
County. They note that the program would also allow county
safety net institutions an opportunity to generate new
revenue through worker and employer premiums. American
Federation of State, County and Municipal Employees,
AFL-CIO supports this bill stating that it believes in
providing health care to all employees regardless of income
and argues that this bill will ensure that workers in small
businesses are able to access health care for themselves
and their families. The Santa Clara County Board of
Supervisors supports this bill because it would expand
eligibility for the program to spouses, domestic partners,
and dependent children. They argue that the bill also will
lower the barriers for participation by some small
businesses.
ASSEMBLY FLOOR :
AYES: Adams, Ammiano, Anderson, Arambula, Beall, Bill
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Berryhill, Tom Berryhill, Blakeslee, Block, Blumenfield,
Brownley, Buchanan, Caballero, Charles Calderon, Carter,
Chesbro, Conway, Cook, Coto, Davis, De La Torre, De Leon,
DeVore, Duvall, Emmerson, Eng, Evans, Feuer, Fletcher,
Fong, Fuentes, Fuller, Furutani, Gaines, Galgiani,
Garrick, Gilmore, Hagman, Hall, Harkey, Hayashi,
Hernandez, Hill, Huber, Jeffries, Jones, Knight,
Krekorian, Lieu, Logue, Bonnie Lowenthal, Ma, Mendoza,
Miller, Monning, Nava, Nestande, Niello, Nielsen, John A.
Perez, V. Manuel Perez, Portantino, Price, Ruskin, Salas,
Saldana, Silva, Skinner, Smyth, Solorio, Audra
Strickland, Swanson, Torlakson, Torres, Torrico, Tran,
Villines, Yamada, Bass
NO VOTE RECORDED: Huffman
CTW:cm 6/29/09 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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