BILL ANALYSIS
AB 2477
Page 1
Date of Hearing: April 6, 2010
ASSEMBLY COMMITTEE ON HEALTH
William W. Monning, Chair
AB 2477 ( Jones) - As Introduced: February 19, 2010
SUBJECT : Medi-Cal: continuous eligibility.
SUMMARY : Deletes the provision that requires Mid-Year Status
Reports (MSRs) for children from January 1, 2011 to July 1,
2012, therefore establishes continuous eligibility for children
in the Medi-Cal Program.
EXISTING LAW :
1)Establishes the Medicaid Program (Medi-Cal in California) to
provide comprehensive health benefits to low-income pregnant
women, children, and people who are aged, blind, and disabled.
2)Requires most Medi-Cal enrollees to file MSRs to maintain
Medi-Cal enrollment.
3)Establishes 12 months of continuous eligibility in Medi-Cal
for children. Limits the period of 12-month continuous
eligibility to the period that increased Federal Matching
Assistance Program (FMAP) is available under American Recovery
and Reinvestment Act of 2009 (ARRA).
4)Implements the requirement of MSRs and the 6-month period of
continuous eligibility upon execution of a declaration
specifying that increased federal financial participation is
no longer available under ARRA.
5)Sunsets the MSR requirement for children on July 1, 2012,
after which a 12-month period of continuous eligibility is
reinstated.
6)Conditions, under federal law, a state's receipt of Medicaid
funds on no more restrictive eligibility standards,
methodologies or procedures than were in effect on July 1,
2008.
FISCAL EFFECT : This bill has not been analyzed by a fiscal
committee.
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COMMENTS :
1)PURPOSE OF THIS BILL . According to the author, this bill is
intended to provide continuity of eligibility for children in
the Medi-Cal Program and to eliminate the uncertainty of
requiring re-enrollment every 6 months. The sponsors, the
100% Campaign, point out that this bill would ensure that
California is eligible to receive billions of dollars in
federal funds for Medi-Cal. They state that Congress is
currently debating the extension of the enhanced FMAP which
continues the requirement that in order to receive enhanced
funding states must meet a Maintenance of Effort (MOE). This
MOE prohibits a state from enacting any more restrictive
eligibility standards, methodologies, or procedures than those
what were in effect as of July 1, 2008. Finally, as the
supporters mention, the President signed the Patient
Protection and Affordable Care Act (HR 3590; PL 111-148) on
March 23, 2010, which also locked in the MOE through 2019.
This bill is therefore necessary to comply with federal law.
2)BACKGOUND . Many adults receiving Medi-Cal must file a MSR six
months after application or after the last annual renewal in
order to keep Medi-Cal coverage. AB 2900 (Gallegos), Chapter
945, Statutes of 2000, enacted continuous eligibility for
children on Medi-Cal and eliminated the requirement that
children under 19 file MSRs to retain Medi-Cal eligibility.
In 2008, as part of the budget reductions, AB 1183 (Committee
on Budget), Chapter 758, Statutes of 2008 (the Omnibus Health
Trailer Bill), added a requirement that children file MSRs,
effective September 30, 2008 and sunset on July 1, 2012. In
the meantime ARRA was enacted at the federal level which
provides an enhanced FMAP. California's share went from 50%
federal, 50% state to 62% federal, 38% state. As a condition
of the enhanced match, states are required to meet the MOE.
In order to comply, SB 24 X3 (Alquist), Chapter 24, Statutes
of 2009 Third Extraordinary Session, made the MSR requirement
inoperative immediately upon enactment, March 27, 2009.
3)MID-YEAR STATUS REPORT PROCESS . Counties send the MSR form to
the beneficiary by the 10th day of the sixth month of
enrollment in the Medi-Cal Program. If a beneficiary has had
no change in income or other eligibility criteria, the form
must be signed and returned by the fifth day of the following
month. If any changes are reported, the county must first
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attempt to redetermine eligibility based on information in its
possession and can request documentation. A recipient may
lose eligibility if the MSR is late or if the county cannot
redetermine eligibility based on the required review.
However, if a recipient returns the MSR late, but within the
eighth month, the county has to process it. If the recipient
is still eligible, the county must rescind the termination and
provide retroactive eligibility.
4)IMPACT ON CHILDREN . DHCS estimates that if MSRs become
effective January 1, 2011 approximately 2 million children
would be required to file MSRs. DHCS further assumes that 25%
would not respond to the first mailing and that 55% would
respond within three months and receive retroactive
eligibility. DHCS assumes that approximately 24% will lose
eligibility. According to data supplied by the California
Welfare Directors, after three years up to two-thirds were
back in Medi-Cal. Another study, "How Much Does Churning in
Medi-Cal Cost?" (The California Endowment, April 2005,
Fairbrother), reports that this churning, due to confusion or
paper work requirements, often resulted in worsened health
conditions, a need for more invasive and more expensive health
care.
5)SUPPORT . The 100% Campaign writes in support that the MSR
requirement essentially buries eligible children in paperwork
so those who can't keep up are dropped and the state no longer
pays for health coverage. When children have gaps in coverage
and do not get timely preventive care they often end up
requiring more expensive health care, such as hospitalizations
and emergency room visits. Western Center on Law and Poverty,
states in support that this bill would ensure that MSRs for
children are repealed and year-long continuous eligibility for
children remains in effect past the extended period of
enhanced FMAP-thereby ensuring vital federal funds for
California and helping children maintain their Medi-Cal
coverage. The California Welfare Directors Association, in
support, reports that data they have analyzed from county
eligibility systems also suggest that significant percentage
of these children will return to coverage within a short
period of time, increasing "churning" in the caseload,
creating extra, unfunded work for county eligibility staff and
potentially delaying coverage for these children as well as
new applicants to the program.
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6)RELATED LEGISLATION . SB 771 (Alquist), currently pending in
the Assembly Health Committee, lengthens the period for which
Medi-Cal would allow 12-month continuous Medi-Cal eligibility
for children, in order for the state to qualify for additional
federal funds via a temporary increase in the FMAP contingent
upon adoption of certain federal legislation, and makes the
reinstatement of 12-month continuous eligibility effective
only during the time period that the increased FMAP is
available.
REGISTERED SUPPORT / OPPOSITION :
Support
The 100% Campaign (sponsor)
American Federation of State, County and Municipal Employees,
AFL-CIO
California Academy of Family Physicians
California Medical Association
California School Health Centers Association
California State Association of Counties
Children Now
Children's Defense Fund California
Children's Partnership
County Welfare Directors Association of California
Health Access
Molina Healthcare of California
PICO California
Regional Council of Rural Counties
San Bernardino County Board of Supervisors
Western Center on Law and Poverty
Several individuals
Opposition
None on file.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097