BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
114 (Liu)
Hearing Date: 5/28/2009 Amended: 5/19/2009
Consultant: Katie Johnson Policy Vote: Health 10-1
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BILL SUMMARY: SB 114 would require the Department of Health
Care Services (DHCS) to deem eligible for and ensure that there
is no interruption in Medi-Cal coverage for an independent
foster care adolescent that was in foster care on his or her
eighteenth birthday. The bill would also require the DHCS to
develop and implement a simplified form for the purposes of
annually redetermining independent foster care adolescent
eligibility, which the individual would return only if his or
her information had changed. The bill would provide that failure
to return the annual redetermination form could not be the only
reason to terminate Medi-Cal benefits to the individual. The
bill would specify that benefits may be discontinued only after
the DHCS established ineligibility. The provisions in the bill
would commence April 1, 2010.
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Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11 2011-12 Fund
Increased Medi-Cal $42 - $59 $193.6 - $270.6
$220 - 307.5 General/
Caseload $ 68.2 - $95 $246.4 - $344.4
$220 - 307.5 Federal*
*October 1, 2008 - December 31, 2010 FMAP = 38%GF / 62%FF
January 1, 2011 - ongoing FMAP = 50%GF / 50%FF
FMAP = Federal Medical Assistance Percentage-the percent of
total costs paid by the federal government.
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STAFF COMMENTS: SUSPENSE FILE.
Existing federal law grants states the option to provide
full-scope, no share-of-cost Medicaid benefits to independent
foster care adolescents, as specified, from ages 18 to 21.
Existing federal law also provides that states may waive any
income or asset tests for this eligible population. The Medi-Cal
program is California's state Medicaid program.
California chose to implement this federal option effective
October 1, 2000, as the Former Foster Care Child Program (FFCC).
The DHCS currently provides benefits to approximately 6,150
independent foster youth in both fee for service (FFS) and
managed care plans. FFS enrollees account for about 75 percent
of this population whereas the other 25 percent are enrolled in
managed care. By means of all county letters (ACL) and
instructions (ACI) in 2000, the DHCS and the Department of
Social Services (DSS) provided that upon one's eighteenth
birthday, a foster youth would be transferred to the FFCC aid
code.
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SB 114 (Liu)
This bill is similar to SB 1132 (Migden) of 2008, a bill that
would have prohibited the DHCS from requiring an independent
foster youth to complete any paperwork qualification or to
provide any other information as a condition of continuing to
receive Medi-Cal benefits at either the time of initial
eligibility or annual redetermination. The Governor vetoed the
bill, stating, "Since federal law currently requires states to
conduct annual eligibility determinations for Medi-Cal
beneficiaries, this measure cannot be implemented because the
bill prohibits the department from requiring foster youth to
complete any paperwork or provide any other information in order
to receive benefits until the age of 21."
This bill would address the veto message by requiring the DHCS
to develop a simplified annual redetermination form. Currently,
the DHCS uses a simplified enrollment form. This simplified
application also functions as a simplified annual
redetermination form. Thus, a new form would not need to be
developed in order to comply with this bill. Approximately 20
percent of these forms are mailed back to the DHCS labeled
"return to sender." If the form is returned as such, the youth's
coverage is discontinued. This policy would not change as a
result of the passage of this bill.
Currently, if the youth receives the form, but does not return
it to the county for annual redetermination, his or her Medi-Cal
eligibility is discontinued. This bill would provide that
failure to return the annual redetermination form could not be
the only reason to terminate Medi-Cal benefits to the
individual. As a result, this bill would decrease the amount of
"churning," which occurs when a beneficiary loses coverage and
must reapply. It is estimated that approximately 500 to 700
youths would retain coverage as a result of the passage of this
bill and there would be some offsetting administrative cost
savings due to reduced churning of eligible beneficiaries. The
annual additional costs, at $113 per member per month for
managed care enrollees and at $60 per member per month for FFS
enrollees, are estimated to be $440,000 - $615,000 annually,
commencing April 1, 2010. Medi-Cal costs are generally shared
equally between the federal government (FF) and state general
fund (GF).
However, as a result of the passage of the American Reinvestment
and Recovery Act (ARRA) in February of 2009, the Federal Medical
Assistance Percentage (FMAP) increased from 50 percent to 61.59
percent. Thus, retroactively from October 1, 2008 through
December 31, 2010, the federal government would pay for
approximately 62 percent and the state general fund would pay
for 38 percent of benefit-related Medi-Cal expenditures. After
December 31, 2010, the FMAP reduces to 50 percent FF, 50 percent
GF.
Staff notes that the May 19, 2009, amendments delete the
provision that would allow the DHCS to terminate eligibility
only after the department establishes ineligibility and all due
process requirements are met. These amendments would not affect
the fiscal analysis