BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 792|
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THIRD READING
Bill No: AB 792
Author: Bonilla (D), et al.
Amended: 8/21/12 in Senate
Vote: 21
SENATE HEALTH COMMITTEE : 5-3, 06/29/11
AYES: Hernandez, Alquist, De Le�n, DeSaulnier, Wolk
NOES: Strickland, Anderson, Blakeslee
NO VOTE RECORDED: Rubio
SENATE JUDICIARY COMMITTEE : 3-2, 7/5/11
AYES: Evans, Corbett, Leno
NOES: Harman, Blakeslee
SENATE APPROPRIATIONS COMMITTEE : 5-2, 8/16/12
AYES: Kehoe, Alquist, Lieu, Price, Steinberg
NOES: Walters, Dutton
ASSEMBLY FLOOR : 50-26, 06/01/11 - See last page for vote
SUBJECT : Health care coverage: California Health
Benefit Exchange
SOURCE : Health Access California
DIGEST : This bill requires a court, upon the filing of a
petition for dissolution of marriage, nullity of marriage,
or legal separation on and after January 1, 2014, to
provide a specified notice informing the petitioner and
respondent that they may be eligible for reduced-cost
CONTINUED
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coverage through the Exchange or no-cost coverage through
Medi-Cal.
ANALYSIS : Existing federal law:
1.Requires, under the federal Patient Protection and
Affordable Care Act (PPACA) (Public Law 111-148), as
amended by the Health Care Education and Reconciliation
Act of 2010 (Public Law 111-152), each state, by January
1, 2014, to establish an American Health Benefit Exchange
(AHBE) that makes qualified health plans available to
qualified individuals and qualified employers. If a
state does not establish an AHBE, the federal government
administers the AHBE. Federal law establishes
requirements for the AHBE, for health plans participating
in the AHBE, and defines who is eligible to receive
coverage in the AHBE. Among other duties, the AHBE is
required to inform individuals of eligibility
requirements for the Medicaid program (Medi-Cal in
California), the Children's Health Insurance Program (the
Healthy Families Program, or HFP, in California), or any
applicable state or local public program. The AHBE is
required if, through screening of the application, the
AHBE determines that such individuals are eligible for
any such program, to enroll such individuals in such
program.
2.Allows through PPACA, effective January 1, 2014, eligible
individual taxpayers whose household income equals or
exceeds 100 percent, but does not exceed 400 percent of
the federal poverty level (FPL), an advanceable and
refundable tax credit for a percentage of the cost of
premiums for coverage under a qualified health plan
offered in the Exchange. PPACA also requires a reduction
in cost-sharing for individuals with incomes below 250
percent of the FPL, and a lower maximum limit on
out-of-pocket expenses for individuals whose incomes are
between 100 percent and 400 percent of the FPL. Legal
immigrants with household incomes less than 100 percent
of the FPL who are ineligible for Medicaid because of
their immigration status are also eligible for the
premium tax credit and the cost-sharing reductions.
3.Requires, through PPACA, numerous changes to Medicaid,
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including expanding eligibility to adults without minor
children with incomes equal to or less than 133 percent
of the FPL, disregarding (or not counting) an additional
five percent in income (making the Medicaid income
eligibility effectively 138 percent of the FPL),
eliminating the asset test and switching to a new method
for calculating income known as modified adjusted gross
income (MAGI) for certain populations.
4.Requires, through PPACA, each individual (with specified
exceptions), and any dependent of the individual, to
maintain minimum essential coverage, provides exemptions
from the individual mandate (such as for affordability,
hardship, and for individuals with incomes below the
income tax filing threshold), and establishes penalties
for violations.
Existing state law:
1.Requires health plans and health insurers that provide
coverage to small employers with 2 to 19 eligible
employees to offer continuation coverage to a qualified
beneficiary (QB) upon a qualifying event without evidence
of insurability. Requires the QB, upon election, to be
able to continue his or her coverage under the group
benefit plan. This body of law is known as Cal-COBRA.
2.Requires employers, employee associations, or other
entities to notify its current and former employees or
members and dependents of federal COBRA continuation
coverage (which requires continuation coverage be offered
to QB experiencing a qualifying event in firms with 20 or
more employees) and state law conversion coverage
options.
3.Regulates the distribution of unemployment compensation
or disability benefits by the Employment Development
Department (EDD).
4.Sets forth procedures related to a petition for
dissolution of marriage, nullity of marriage, or legal
separation, or a petition for adoption.
5.Establishes the Exchange in state government, and
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specifies the duties and authority of the Exchange.
Requires the Exchange be governed by a board that
includes the Secretary of the Health and Human Services
Agency and four members with specified expertise who are
appointed by the Governor and the Legislature.
This bill requires a court, upon the filing of a petition
for dissolution of marriage, nullity of marriage, or legal
separation on and after January 1, 2014, to provide a
specified notice informing the petitioner and respondent
that they may be eligible for reduced-cost coverage through
the Exchange or no-cost coverage through Medi-Cal.
Background
Federal health care reform makes numerous changes to reduce
the number of uninsured Americans. According to estimates
in a recent study in the health policy journal Health
Affairs by Peter Long and Jonathan Gruber, PPACA will
provide health insurance for an additional 3.4 million
people in California in 2016. The authors state this will
mean that nearly 96 percent of documented residents of
California under age 65 will be insured. The authors
estimate enrollment in Medi-Cal is expected to increase by
1.7 million people, while 4.0 million people are expected
to enroll in the state's Exchange. Employer-sponsored
insurance and spending on health insurance will decline
slightly. The authors conclude that low-income households
will experience substantial financial benefits, but
families at the highest income levels will pay more.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee, the
August 17 amendments remove the requirement on EDD to
furnish notices and reduce the costs of the bill
accordingly. There would continue to be cost avoidance to
the extent that individuals who would have otherwise
enrolled in state programs such as Major Risk Medical
Insurance Program, Access for Infants and Mothers Program,
the Preexisting Condition Insurance Program, and the AIDS
Drug Assistance Program, purchase health care coverage
through the Exchange. Additionally, there would continue to
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be significant costs to the extent that individuals, upon
application to the Exchange, are found eligible for state
programs such as those listed above or Medi-Cal or the
Healthy Families Program.
SUPPORT : (Verified 6/29/11) (per Senate Health Committee
analysis - unable to reverify at time of writing)
Health Access California (source)
100% Campaign
American Federation of State, County and Municipal
Employees
California Labor Federation
California Medical Association
California Pan-Ethnic Health Network
California Primary Care Association
California Rural Legal Assistance Foundation
Congress of California Seniors
Consumers Union
Contra Costa County Board of Supervisors
Having Our Say
National Association of Social Workers, California Chapter
Service Employees International Union
Unitarian Universalist Legislative Ministry Action
Network-California
United Nurses Associations of California/Union of Health
Care Professionals
Western Center on Law & Poverty
OPPOSITION : (Verified 6/29/11) (per Senate Health
Committee analysis - unable to reverify at time of writing)
Association of California Life and Health Insurance
Companies
California Association of Health Plans
California Association of Health Underwriters
ARGUMENTS IN SUPPORT : This bill is sponsored by Health
Access California (HAC), which writes that this bill would
create mechanisms to maximize enrollment in coverage of
those who face life changes such as loss of a job or loss
of dependent coverage due to loss of a spouse. HAC states
that any Californian can become uninsured because of a
change in life circumstance (such as aging-off coverage,
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losing or switching a job, divorce, death or moving), yet
state policy does relatively little to help people stay on
coverage other than to require the provision of a notice of
their ability to continue coverage. HAC states that, in
2014, every one of these individuals is eligible for
coverage either in the Exchange or Medi-Cal, yet no
mechanism exists to connect these individuals to coverage.
HAC states that less than half the uninsured are uninsured
for less than a year, almost a quarter of the uninsured for
are uninsured one to two years, and the remaining third are
uninsured for more than two years. The design of the
Exchange and redesign of Medi-Cal/Healthy Families needs to
into take account the need to serve the short-term
uninsured as well as providing long-term coverage in order
to keep Californians covered and healthy.
HAC states this bill would connect to people to the
Exchange by providing notice in 2012 and 2013 that low-cost
or no-cost coverage will be available through the Exchange
and Medi-Cal effective 2014. Beginning in January 1, 2014,
this bill would require insurers and health plans to
initiate enrollment into the Exchange as well as COBRA for
COBRA-qualifying events, including loss of employment-based
coverage, loss of coverage due to loss of a spouse or
parent and other COBRA qualifying events. HAC concludes
that in 2014, there is no reason why losing one's job or
getting divorced should mean losing health coverage as
millions of Californians will be eligible for coverage
through the Exchange or Medi-Cal, and this bill will help
those Californians get coverage when they need it and when
the law requires it.
ARGUMENTS IN OPPOSITION : This bill is opposed by the
California Association of Health Plans and the Association
of California Life and Health Insurance Companies (ACLHIC).
ACLHIC states that this bill requires an insurer to obtain
the consent of its insureds to share their information with
the Exchange, yet provides no direction as to how to meet
that obligation if the individual is simply nonresponsive.
ACLHIC states that, in a day of heightened privacy
concerns, many individuals may be reluctant to give consent
to share their personal information, and ACLHIC is
concerned about potential liability to the insurer that is
required to obtain and maintain this information. ACLHIC
states this bill should be amended to provide protection to
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the insurer that forwards such information to the Exchange
in accordance with the requirements of the bill. ACLHIC
also argues this bill requires insurers to send multiple
and duplicative notices to an insured of their right to
enroll in the Exchange with every change in the insured's
coverage, and that this bill should be amended to include
its required notice with Cal COBRA notices in the manner
that they are currently required to be sent to insured
individuals. ACLHIC states this would be consistent with
all other notices of coverage rights, and would not only be
cost effective, but less confusing to the insured.
ASSEMBLY FLOOR : 50-26, 06/01/11
AYES: Alejo, Allen, Ammiano, Atkins, Beall, Block,
Blumenfield, Bonilla, Bradford, Brownley, Buchanan,
Butler, Charles Calderon, Campos, Carter, Cedillo,
Chesbro, Davis, Dickinson, Eng, Feuer, Fong, Fuentes,
Furutani, Galgiani, Gordon, Hall, Hayashi, Roger
Hern�ndez, Hill, Huber, Hueso, Huffman, Lara, Bonnie
Lowenthal, Ma, Mendoza, Mitchell, Monning, Pan, Perea,
Portantino, Skinner, Solorio, Swanson, Torres,
Wieckowski, Williams, Yamada, John A. P�rez
NOES: Achadjian, Bill Berryhill, Conway, Cook, Donnelly,
Fletcher, Beth Gaines, Gatto, Grove, Hagman, Halderman,
Harkey, Jones, Knight, Logue, Mansoor, Miller, Morrell,
Nestande, Nielsen, Norby, Olsen, Silva, Smyth, Valadao,
Wagner
NO VOTE RECORDED: Garrick, Gorell, Jeffries, V. Manuel
P�rez
CTW:n 8/21/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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