BILL ANALYSIS �
AB 43
Page 1
ASSEMBLY THIRD READING
AB 43 (Monning)
As Amended May 27, 2011
Majority vote
HEALTH 13-6 APPROPRIATIONS 12-5
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|Ayes:|Monning, Ammiano, Atkins, |Ayes:|Fuentes, Blumenfield, |
| |Bonilla, Eng, Gordon, | |Bradford, Charles |
| |Hayashi, | |Calderon, Campos, Davis, |
| |Roger Hern�ndez, Bonnie | |Gatto, Hall, Hill, Lara, |
| |Lowenthal, Mitchell, Pan, | |Mitchell, Solorio |
| |V. Manuel P�rez, Williams | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Logue, Garrick, Mansoor, |Nays:|Harkey, Donnelly, |
| |Nestande, Silva, Smyth | |Nielsen, Norby, Wagner |
| | | | |
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SUMMARY : Expands Medi-Cal coverage to persons with income that does
not exceed 133% of the federal poverty level (FPL), effective
January 1, 2014. Specifically, this bill :
1)Requires the Department of Health Care Services (DHCS), by January
1, 2014, to establish eligibility for Medi-Cal benefits for any
person who meets the requirements of a new Medicaid eligibility
category added by the federal Patient Protection and Affordable
Care Act (PPACA).
2)Authorizes DHCS to phase in coverage, as permitted by federal law.
3)Requires DHCS to prepare and submit for approval from the Centers
for Medicare and Medicaid Services (CMS) a plan to transition from
the Section 1115(a) Medicaid Demonstration Waiver (Waiver)
entitled "California's Bridge to Reform" to implementation of the
Medi-Cal expansion required by PPACA.
4)Requires the transition plans to include a process to ensure
Medi-Cal eligibility for participants in a county Low Income
Health Program (LIHP) developed pursuant to the 2010 Waiver, as
well as other persons who meet the eligibility standards but are
not enrolled in a county LIHP.
AB 43
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EXISTING FEDERAL LAW :
1)Requires, by January 2014, that states offer Medicaid coverage to
all adults, under age 65, with income up to 133% of the Federal
Poverty Level (FPL) and authorizes a phase-in immediately.
2)Authorizes, the waiving of specified federal Medicaid requirements
for demonstration or pilot projects.
EXISTING LAW :
1)Establishes the federal Medicaid Program, administered by DHCS, to
provide comprehensive health care services and long-term care to
pregnant women, children, and people who are aged, blind, and
disabled.
2)Establishes the LIHP, a county-optional health program as a
Medicaid Coverage Expansion using local county expenditures to
match federal funds as part of a comprehensive Waiver.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Unknown, likely significant costs, potentially in the millions,
for systems changes, staffing, and other administrative activities
to implement the eligibility expansion required under federal law.
Further federal guidance and state planning are needed in order
to estimate the administrative costs associated with the
expansion. Since the eligibility expansion is required under
federal law, the state would likely incur these costs even in the
absence of this bill.
2)Estimated federal expenditures associated with coverage of the
newly eligible population are up to $2.7 billion beginning in
state fiscal year 2013-14, and up to $5.5 billion for the first
full year of implementation in 2014-15 (the newly eligible
population is initially funded with 100% federal funds). The
actual expenditures and timing of expenditures will depend on the
take-up rate and how quickly individuals enroll. Beginning in
2014, state and federal authorities will implement a number of
changes related to health care coverage, including the individual
mandate to obtain health care coverage. It is unknown what
portion of individuals will apply for Medi-Cal coverage due
specifically to the eligibility expansion in this bill, as
AB 43
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compared to other changes.
3)The estimated state fiscal impact associated with coverage of the
newly eligible population is up to $150 million in state General
Fund (GF) beginning in state fiscal year 2016-17, and up to $450
million GF by 2018-19.
4)The state is expected to realize cost savings in various smaller
state health care programs, since a significant portion of the
population currently served by these programs will likely seek
comprehensive health care coverage through Medi-Cal when
eligibility is expanded. The California Health and Human Services
Agency estimates that the state will save approximately $1.4
billion ($600 million GF) annually in 2014-15, the first full year
of the eligibility expansion, as compared to projected
expenditures. The majority of these savings will likely be due to
the expansion of Medi-Cal eligibility.
COMMENTS : According to the author, the purpose of this bill is to
implement the new federal law to expand Medi-Cal benefits to
low-income adults, including those without children, as long as
their income doesn't exceed 133% of FPL, or $14,404 annually for
individuals. The author states that this bill is needed in order to
begin the planning process for a transition from the Waiver to the
Medi-Cal implementation required by PPACA in 2014. The author
points out that this bill is also needed to ensure that California
meets the CMS requirement that the state submit an initial
transition plan by July 1, 2012 and begin transition activities July
1, 2013. Even though most counties are expected to enroll and
provide coverage to members of this population by participating in
the LIHP in some capacity, this is not expected to cover the entire
eligible population. Full implementation in 2014 is expected to
include over one million adults. The author states that the
Medi-Cal system must be prepared to absorb this entire population.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916) 319-2097
FN: 0001008