BILL ANALYSIS
AB 2477
Page 1
ASSEMBLY THIRD READING
AB 2477 (Jones)
As Introduced February 19, 2010
Majority vote
HEALTH 15-0 APPROPRIATIONS 12-5
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|Ayes:|Monning, Fletcher, |Ayes:|Fuentes, Ammiano, |
| |Ammiano, Carter, Conway, | |Bradford, |
| |Bradford, De Leon, Eng, | |Charles Calderon, Coto, |
| |Hayashi, Hernandez, | |Davis, Monning, Ruskin, |
| |Jones, | |Skinner, Solorio, |
| |Bonnie Lowenthal, Nava, | |Torlakson, Torrico |
| |V. Manuel Perez, Salas | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
| | |Nays:|Conway, Harkey, Miller, |
| | | |Nielsen, Norby |
| | | | |
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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.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)An annual increase of $10 million (50% General Fund (GF)) to
maintain 7,300 children on Medi-Cal who may otherwise lose
coverage due to failure to comply with a semi-annual reporting
period.
The Governor's 2010-11 budget contains a proposal to move
children from a 12-month eligibility period to a six-month
eligibility period effective January 1, 2011. The savings
associated with this proposal implemented for a half-year are
$4.9 million (50% GF). The governor's budget proposal is
consistent with legislative actions taken in 2008, discussed
below.
2)The cost generated by this bill is eclipsed by the possible
loss of federal funding in the range of $25 billion if
AB 2477
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California violates the federal Maintenance of Effort (MOE)
requirements for children in effect through September 2019.
3)According to some quantitative analysis and advocates, annual
reporting may be cost-beneficial by providing continuous
coverage to children and reducing Medi-Cal administrative
workload.
COMMENTS : 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 Federal Matching Assistance Program
(FMAP) which continues the requirement that in order to receive
enhanced funding states must meet 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.
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, enacts continuous eligibility for children on Medi-Cal and
eliminates the requirement that children under 19 file MSRs to
retain Medi-Cal eligibility. In 2008, as part of the budget
reductions, AB 1183 (Budget Committee), Chapter 758, Statutes of
2008 (the Omnibus Health Trailer Bill), adds a requirement that
children file MSRs, effective September 30, 2008 and sunset on
July 1, 2012. In the meantime the American Recovery and
Reinvestment Act of 2009 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.
AB 2477
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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 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.
DHCS estimates that if MSRs become effective January 1, 2011,
approximately two 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.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097
FN: 0004663