BILL ANALYSIS �
AB 714
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Date of Hearing: April 26, 2011
ASSEMBLY COMMITTEE ON HEALTH
William W. Monning, Chair
AB 714 (Atkins) - As Amended: April 14, 2011
SUBJECT : Health care coverage: California Health Benefit
Exchange.
SUMMARY : Requires a notification to individuals who have ceased
to be enrolled in specified public health care coverage programs
and to individuals receiving services under specified health
programs regarding potential eligibility for health care
coverage through the California Health Benefit Exchange
(Exchange). Requires specified entities and state departments
to provide the disclosure of information, such as the name and
address of each enrollee, to specified state departments and to
the Exchange. Requires the initiation of an application for
enrollment in coverage through the Exchange and permits
individuals to have the opportunity to decline coverage by
notifying the Exchange in writing. Specifically, this bill :
1)Requires individuals who have ceased to be enrolled in the
Healthy Families Program (HFP), the Access for Infants and
Mothers (AIM) program, the California Major Risk Medical
Insurance Program (MRMIP), the Federal Temporary High Risk
Pool, and Medi-Cal, after January 1, 2012, to be provided with
a notice regarding potential eligibility for health care
coverage through the Exchange. Specifies the exact language
to be used in the notice for each program.
2)Requires the notice in 1) above to be provided to persons
receiving services under the AIDS Drug Assistance Program
(ADAP), the federal Ryan White HIV/AIDS Treatment Extension
Act of 2009 (Ryan White program), FamilyPACT program, and the
breast and cervical cancer treatment program (BCCP). Requires
entities that provide services under those programs, after
January 1, 2013, to provide to the Department of Public Health
(DPH) �for ADAP and Ryan White program] and the Department of
Health Care Services (DHCS) �for FamilyPACT and BCCP] the
name, address, and "other information" of each enrollee, as
specified. Requires DPH and DHCS to provide the information
to the Exchange and to the Medi-Cal program so that
eligibility may be determined and enrollment completed.
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3)Requires DHCS, after January 1, 2013, to provide to the
Exchange, the name, address, and "other information" on every
individual who has ceased to be enrolled in Medi-Cal.
4)Requires the California Managed Risk Medical Insurance Board
(MRMIB), after January 1, 2013, to provide to the Medi-Cal
program and to the Exchange, the name, address, and "other
information" on every individual who has ceased to be enrolled
in HFP, AIM, the MRMIP, and the Federal Temporary High Risk
Pool.
5)Requires the information provided in 2) through 4) above to
initiate an application for enrollment in coverage through the
Exchange. Permits individuals to have the opportunity to
decline coverage pursuant to this bill by notifying the
Exchange in writing.
6)Requires DHCS, DPH, and MRMIB to seek approval from the U.S.
Department of Health and Human Services (HHS) to transfer the
minimum information necessary to initiate an application for
enrollment in coverage through the Exchange.
7)Requires the statement regarding eligibility for public
insurance programs that hospitals provide as part of a patient
billing to also include information about coverage through the
Exchange.
EXISTING LAW :
1)Establishes the BCCP, administered by DHCS, for the treatment
of breast and cervical cancer. Establishes HFP, AIM, MRMIP,
and the Federal Temporary High Risk Pool, administered by
MRMIB, and Medi-Cal and FamilyPACT, administered by DHCS, for
the provision of health care coverage to eligible individuals.
2)Provides specified health care coverage to HIV positive
individuals under ADAP and the federal Ryan White program,
which are administered by DPH.
3)Requires, under the federal Patient Protection and Affordable
Care Act (PPACA), each state to, by January 1, 2014, establish
an American Health Benefit Exchange that makes qualified
health plans available to qualified individuals and employers.
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4)Establishes the Exchange within state government, specifies
the powers and duties of the Exchange governing board relative
to determining eligibility for enrollment in the Exchange and
arranging for coverage under qualified health plans, and
requires the board to facilitate the purchase of qualified
health plans through the Exchange by qualified individuals and
small employers by January 1, 2014.
FISCAL EFFECT : This bill has not yet been analyzed by a fiscal
committee.
COMMENTS :
1)PURPOSE OF THIS BILL . According to the author, 7 million
Californians were estimated to be uninsured in 2009, and of
those, as many as 5 million are eligible for coverage through
the Exchange or Medi-Cal. The author states that initial
enrollment in public programs including HFP and the new high
risk pool has been slow. Additionally, the author states that
existing law is silent with respect to notifying and
pre-enrolling those who are likely to be eligible for the
Exchange or newly eligible for Medi-Cal who are already
enrolled in other public programs or who seek charity care or
discounted care from hospitals. The author states that in
order to accelerate enrollment of those likely to be eligible
for Exchange coverage or Medi-Cal in 2014, this takes two
steps: in 2012 and 2013, those likely to be eligible are given
notice of the availability of low-cost or no-cost coverage
through the Exchange or Medi-Cal effective in 2014; and,
second, in 2013, those already enrolled in an existing public
program with limited benefits or covered by Medi-Cal and HFP
but about to lose coverage will be pre-screened and
pre-enrolled in coverage through the Exchange or Medi-Cal.
2)PPACA . It is estimated that 4.7 million California children
and adults who were uninsured during some part of 2009 will be
eligible for health coverage under PPACA. Among other
provisions, PPACA requires, as of January 2014, that states
include all adults with income up to 133% of the federal
poverty level (FPL) in its Medicaid Program (Medi-Cal in
Claifornia) and provides enhanced federal matching assistance
funds (FMAP). PPACA establishes a new eligibility category
for all non-pregnant, non-Medicare eligible childless adults
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under age 65 who are not otherwise eligible for Medicaid and
requires minimum Medicaid coverage at 133% FPL based on
modified gross income with a special adjustment of 5% to bring
effective income eligibility to 138% FPL. Eligibility is to
be determined without assets or resource tests. In addition,
PPACA requires the establishment of Health Insurance Exchanges
for individuals and small groups who want to enroll in a
qualified health plan. California exercised the option to
establish the Exchange. Effective January 2014, individuals
with income of 100% but not more than 400% of FPL
(approximately $29,000 to $88,000 for a family of four) will
receive a refundable tax credit for a percentage of the cost
of premiums that are purchased through the Exchange.
3)THE EXCHANGE . California was the first state in the nation to
enact legislation creating a health benefit exchange under
PPACA. AB 1602 (John A. P�rez), Chapter 655, Statutes of
2010, and SB 900 (Alquist), Chapter 659, Statutes of 2010,
established the Exchange as an independent public entity
governed by a five-member executive board. According to
California's health care reform Website
(www.healthcare.ca.gov), the Exchange will enhance competition
and provide the same advantages available to large employer
groups by organizing the private insurance market, including a
more stable risk pool, greater purchasing power, more
competition among insurers and detailed information about the
price, quality, and service of health coverage. The Exchange
will also support consumer choice by making comprehensive
information about health plans available in an objective,
easy-to-understand format, including: a Website that provides
standardized comparison information on qualified health plan
benefit plans/options; a calculator for applicants to compare
costs across plan options; a Web-based eligibility portal to
help link individuals to health coverage options available to
them; and, a toll-free consumer assistance hotline. Health
insurance products offered through the Exchange must be
available in the same form to consumers purchasing coverage
outside the Exchange. All health plans and insurers
participating in the Exchange must offer all Exchange plans at
the federally designated bronze, silver, gold, and platinum
levels. Catastrophic plans will only be available through
health plans and insurers participating in the Exchange, but
will be available both inside and outside the Exchange.
The federal government awarded California $1 million to fund
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preliminary planning efforts related to the development of an
exchange. Additional federal implementation grants are
expected to be announced in the spring of 2011. After 2014,
the Exchange must be self-supporting from fees paid by health
plans and insurers participating in the Exchange.
4)RELATED LEGISLATION . AB 43 (Monning) requires 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 PPACA, in effect
expanding Medi-Cal coverage to persons with income that does
not exceed 133% of FPL. AB 43 is set to be heard in the
Assembly Health Committee on April 26, 2011.
AB 792 (Bonilla) requires the disclosure of information on
health care coverage through the Exchange, under specified
circumstances, by health care service plans, health insurers,
employers, employee associations, the Employment Development
Department, upon an initial claim for disability benefits, or
by the court, upon the filing of a petition for dissolution of
marriage, nullity of marriage, legal separation, or adoption.
AB 792 is set to be heard in the Assembly Health Committee on
April 26, 2011.
5)SUPPORT . Health Access California (HAC), the sponsor of this
bill, and numerous other supporters write that this bill will
accelerate enrollment of those likely to be newly eligible for
subsidized coverage through the Exchange or no-cost coverage
in Medi-Cal. HAC states that all of those newly eligible are
100% federal funded, and that even the Medi-Cal enrollees are
100% federally funded through 2017. Planned Parenthood
Affiliates of California and Planned Parenthood Advocacy
Project Los Angeles County write that in order to maximize
federal funding and anticipated cost savings of PPACA, the
enrollment process for the uninsured must be as efficient as
possible and ensure continuity of care by using existing
essential community providers, and this bill will create that
process. The Congress of California Seniors contends that the
implementation of this bill would allow greater use of federal
dollars to offer affordable, comprehensive coverage to
millions of Californians.
6)POLICY CONCERNS .
a) This bill requires "other information" to be submitted
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to the Exchange by DHCS, DPH, MRMIB, and entities providing
services to individuals through ADAP, Ryan White program,
FamilyPACT, and BCCP. This bill also requires that
provision of that information triggers an initiation of an
application to the Exchange for coverage. According to the
sponsor of this bill, the types of information necessary
for initiating an application is generally contact and
identifying information, not medical claims. However, since
the Exchange enrollment process has not been determined, it
is not possible to identify what information will have to
be forwarded in order for the Exchange to initiate an
application. Therefore, this requirement may be premature
and the author may want to delete these provisions from the
bill until information about the application and enrollment
process is made available.
b) This bill requires entities that provide services under
ADAP, Ryan White, BCCP, and FamilyPACT to provide DPH and
DHCS with enrollee information. However, as the
administrators of those programs, DPH and DHCS should have
enrollee information, making this requirement unnecessary.
c) According to 45 CFR Section 160.103, under the Health
Insurance Portability and Accountability Act (HIPAA) of
1996 privacy rule "health information" means any
information that:
(1) Is created or received by a health care provider, health
plan, public health authority, employer, life insurer,
school or university, or health care clearinghouse; and
(2) Relates to the past, present, or future physical or
mental health or condition of an individual; the provision
of health care to an individual; or the past, present, or
future payment for the provision of health care to an
individual.
This bill, by requiring the provision of identifying
information about people receiving services under ADAP,
Ryan White, and the breast and cervical cancer programs,
appears to in effect, be related to the condition of and
care provided to an individual (potentially violating (2)
above). This bill does require DHCS, DPH, and MRMIB to
seek approval from HHS to transfer the minimum information
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necessary to initiate an application for enrollment in
coverage through the Exchange (conforming to the "exception
determination," under which HHS can determine that the
State law is "necessary for purposes of a compelling public
health, safety, or welfare need), but the author may wish
to also include language to preclude any sharing of
information from violating HIPAA and the state's
Confidentiality of Medical Information Act.
7)SUGGESTED TECHNICAL AMENDMENTS . The author intends that DHCS
and MRMIB provide the notice about coverage options to
Medi-Cal, AIM, and HFP enrollees. However, this bill does not
specify who the requirement is placed upon, just that "every
individual receiving services" or "every individual who ceases
to be enrolled" are required to be provided with the notice.
This bill should be amended to clarify that the departments
are responsible for that function.
REGISTERED SUPPORT / OPPOSITION :
Support
Health Access California (sponsor)
American Federation of State, County and Municipal Employees,
AFL-CIO
California Medical Association
California Pan-Ethnic Health Network
California Primary Care Association
California rural Legal Assistance Foundation
Children NOW
Children's Defense Fund California
Congress of California Seniors
Consumers Union
Having Our Say
International Brotherhood of Electrical Workers, Local Union
569, San Diego
PICO California
Planned Parenthood Advocacy Project Los Angeles
Planned Parenthood Affiliates of California
Unitarian Universalist Legislative Ministry Action Network-CA
SEIU California
The 100% Campaign
United Nurses Association of California/Union of health Care
Professionals
Western Center on Law & Poverty
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Opposition
None on file.
Analysis Prepared by: Melanie Moreno / HEALTH / (916) 319-2097