BILL ANALYSIS �
AB 272
Page 1
Date of Hearing: March 22, 2011
ASSEMBLY COMMITTEE ON HEALTH
William W. Monning, Chair
AB 272 (Monning) - As Amended: March 7, 2011
SUBJECT : Health care coverage: agencies; reports.
SUMMARY : Repeals obsolete requirements that various state
agencies report to the Legislature. Specifically, this bill :
1)Repeals the requirement that the Managed Risk Medical
Insurance Board (MRMIB) report to the Legislature, on or
before January 30, 2004, information regarding the State
Children's Health Insurance Program (SCHIP) with regard to
vulnerable children, public health initiatives, and
recommendations for addressing health needs and barriers.
2)Repeals the requirement that MRMIB provide to the Legislature,
in consultation with the Department of Alcohol and Drug
Programs (DADP), by April 15, 1998, a proposal assessing the
viability of providing additional drug and alcohol treatment
services for children enrolled in the Healthy Families Program
(HFP).
3)Repeals the requirement that DADP, in cooperation with MRMIB,
review capacity needs for alcohol and drug benefits in HFP,
request utilization and services data from the counties, and
request HFP plans collect data on the unmet need for a
substance abuse benefit and report to the policy and fiscal
committees of the Legislature, by September 1, 1999.
4)Repeals a requirement that a joint senior level working group
of the Department of Managed Health Care (DMHC) and the
California Department of Insurance (CDI) report findings
relating to grievances, consumer complaints and enforcement to
the Legislature for five years, effective 2003.
EXISTING LAW :
1)Establishes HFP as the California version of SCHIP,
administered by MRMIB, to provide low cost health, dental, and
vision coverage to uninsured resident children, under age 19
in working families.
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2)Requires local governments to designate an alcohol and drug
program administrator to function as the broker of local
prevention and treatment services and provides that DADP
license, certify and monitor the local treatment programs.
3)Provides that health insurers are regulated by CDI and managed
care health plans are regulated by DMHC.
FISCAL EFFECT : This bill has not been analyzed by a fiscal
committee.
COMMENTS :
1)BACKGROUND . According to the author, this bill is intended to
remove outdated and obsolete reporting requirements on various
departments that administer or regulate health care coverage
programs. In each case the due date has passed and the
reports have been completed and submitted to the Legislature.
2)HFP . The HFP was established in 1998 as the California
version of federal SCHIP by AB 1126 (Villaraigosa),
Chapter 623, Statutes of 1997. HFP provides low cost health,
dental, and vision coverage to uninsured resident children,
under age 19 in working families. It is funded by state and
federal matching funds and family premiums and is administered
by MRMIB. In January of 2011, HFP provided low-cost insurance
coverage to 879,031 uninsured children.
3)ALCOHOL AND SUBSTANCE ABUSE BENEFITS IN HFP. The Federal law
that enacted SCHIP did not require states to cover treatment
for substance abuse in its insurance programs. Instead states
were allowed to model the benefits package after one of
several benchmark plans. California chose to base the HFP
benefits on the Public Employment Retirement System (PERS)
which offers limited substance abuse services. PERS plans
have the option to provide additional outpatient visits. AB
1126 required MRMIB, in consultation with DADP, to provide to
the Legislature by April 15, 1998, a report assessing the
viability of using federal SCHIP funds to provide additional
alcohol and drug abuse prevention services in HFP. AB 1126
required that if MRMIB determined that it was feasible and if
federal approval was obtained, MRMIB negotiate with the
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participating HFP plans to establish memoranda of
understanding between plans and counties to facilitate
referral of children in need of these services to county
treatment programs.
In April 1998, MRMIB submitted the required report entitled,
"The Viability of Providing Additional Alcohol and Drug
Treatment Services to Healthy Families Children" to the
Legislature. The report provided an overview of the alcohol
and drug treatment services for children, a description of the
benchmark plan services and an analysis of the viability of
using federal funds SCHIP funds to provide additional
services. The 1998 report concluded: a) there was a
significant and systemic gap in the treatment system; b) the
data was insufficient to determine need; and, c) there were no
available state funds that could be used to access any
additional federal matching SCHIP funds.
The Legislature requested a follow up report from MRMIB (AB 2780
(Gallegos), Chapter 310, Statutes of 1998). Specifically, AB
2780 found that based on the April 1998 report, a gap in
alcohol and other drug treatment for adolescents existed. AB
2780 further required additional data collection and analysis
by DADP, health plans and MRMIB. AB 2780 also required DADP
to review the needs and utilization of adolescents based on
data collected by counties and required MRMIB to determine the
number of children needing services that exceeded the benefit
in their plan.
MRMIB provided a draft Report in September 1999 to the Fiscal
and Policy Committees of the California Legislature entitled,
"The Adequacy of Alcohol and Drug Abuse Benefits in the
Healthy Families Program." The September 1999 report
concluded there was still insufficient data available to
determine the adequacy of the alcohol and drug abuse benefits
provided through the HFP. Specifically, the September 1999
report determined that the county alcohol and drug data system
was not designed to identify the number of adolescents who are
enrolled in the HFP and are also being seen by county
providers. Furthermore, the data systems within the network
of plan providers were not designed to identify and track the
number of members who were receiving substance abuse treatment
or in need additional substance abuse services beyond the
scope of the HFP benefits. In addition, the number of
subscribers was probably insufficient to adequately capture
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adolescents who would need extensive services beyond those
provided by HFP.
4)VULNERABLE CHILDREN. SB 59 (Escutia), Chapter 800, Statutes
of 2002, required MRMIB to report to the Legislature by
January 30, 2004, a list of categories of vulnerable children
who should be targets of public health initiatives under HFP.
SB 59 also required MRMIB to recommend innovative methods
available under SCHIP for addressing the health care needs of
vulnerable children. MRMIB was directed to seek input at
their regularly scheduled meetings, from the HFP Advisory
Panel and from stakeholder organizations. MRMIB issued a
report to the Legislature in September 2004, entitled, "Using
Title XXI Funds for Initiatives to Address the Health Care
Needs of Vulnerable Children in California."
According to the September 2004 report, SCHIP authorized the
funding of public health initiatives. However, states were
required to fund these demonstration projects from the 10% of
the SCHIP grant that is allowed for "administrative expenses."
The September 2004 report concluded that California had
sufficient federal funds under the 10% cap to cover costs
associated with public health initiatives, although in past
years, there was no room under the cap for additional
expenditures due to the fact that outreach funding that was
counted against the cap. When the State eliminated funding
for outreach due to the State's fiscal crisis, room under the
administrative cap was made available. Nonetheless as the
State's fiscal crisis had not improved there were still no
funds for outreach or for public health initiatives.
The September 2004 report identified uninsured children and
children of immigrant and homeless families as least likely to
not have a usual source of care and as less likely than
insured children to receive treatment for childhood conditions
or injuries. The September 2004 report also found disparities
in health access among adolescents, Latino and American
Indian/Alaska Native children, non-citizen children with
non-citizen parents, citizen children with non-citizen
parents, and children in limited-English proficient families.
The September 2004 report concluded if there were funds
available there were several options available to the State
for implementing public health initiatives using demonstration
project models to target these identified vulnerable
populations.
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5)REGULATION OF HEALTH INSURERS AND HEALTH PLANS . Regulatory
jurisdiction over health insurance and health plans has been
the responsibility of separate state agencies in California
for over 60 years. In 2000, regulation of health plans was
moved from the Department of Corporations to the newly created
DMHC. The implementing legislation, AB 78 (Gallegos),
Chapter 525, Statues of 1999, required DMHC to identify
whether bifurcated jurisdictions should continue. The 2001
study, entitled, "Regulatory Jurisdiction Over Health
Insurance Products: The Department of Managed Health Care &
the Department of Insurance," by Professor J. Clark Kelso,
recommended among other things, that if bifurcated regulation
were to continue: a) hotline performance must be equalized; b)
equalizing other consumer protections; and c) an examination
of crossover functions.
Subsequently, SB 1913 (Committee on Insurance), Chapter 793,
Statutes of 2002, required DMHC and the CDI to maintain a
joint senior level working group to ensure clarity in
enforcement and consistency in regulations. The joint working
group was required to review and examine certain procedures in
the departments, to review grievance and consumer complaint
processes, processes to ensure enforcement of the law, and
processes to ensure timely payment of claims and to report its
findings to the Insurance Commissioner and the Director of
DMHC and to submit the Report to the Legislature by January 1
of every year for five years. The requirement became
effective January 1, 2003. DMHC has provided Joint Senior
Level Work Group Reports from Year One (January 2004), Year
Two (January 2005), Year Three (January 2006), Year Four
(January 2007), and Year Five (January 2008).
According to the Year One report, the departments began to work
together in 2000 and formalized the working relationship by
signing a Memorandum of Understanding in August 2002. As
required by SB 1913, the reports provided information
regarding the work of the Senior Work Group and Interagency
work groups on the following topics:
a) Consumer Protection and Outreach;
b) Market Conduct Examination Process;
c) Enforcement; and,
d) Regulations.
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The Year Four report states that this marks the end of the
five-year agreement, but cooperation between the two
departments will continue. It further states that the
departments are confident that they will be able to reduce
confusion and continue improving information and assistance to
enrollees and insureds.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file.
Opposition
None on file.
Analysis Prepared by : Marjorie Swartz / HEALTH / (916)
319-2097