BILL ANALYSIS �
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THIRD READING
Bill No: SB 677
Author: Hernandez (D)
Amended: 5/23/11
Vote: 21
SENATE HEALTH COMMITTEE : 6-3, 4/27/11
AYES: Hernandez, Alquist, De Le�n, DeSaulnier, Rubio, Wolk
NOES: Strickland, Anderson, Blakeslee
SENATE APPROPRIATIONS COMMITTEE : 6-2, 1/19/12
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Emmerson
NO VOTE RECORDED: Runner
SUBJECT : Medi-Cal: eligibility
SOURCE : Author
DIGEST : This bill prohibits the Department of Health
Care Services from applying an assets or resources test
when determining eligibility for Medi-Cal or any Medi-Cal
waiver, as specified.
ANALYSIS : Existing law:
1. Establishes the Medi-Cal program, administered by DHCS,
under which health care services are provided to
qualified low-income persons.
2. Requires each Medi-Cal applicant who is not a recipient
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of aid under the California Work Opportunity and
Responsibility to Kids Act (CalWORKS) or Supplemental
Security Income/State Supplementary Payment (SSI/SSP) to
file an affirmation setting forth such facts about his
or her annual income and other resources and
qualifications for eligibility, as may be required by
DHCS.
3. Defines "income and personal property" for purposes of
determining Medi-Cal eligibility under a specified
Medi-Cal eligibility category.
This bill:
1. States legislative intent to implement the provisions of
federal health care reform that prohibit the use of an
assets or resources test in the Medi-Cal program for
certain individuals and that require the use of MAGI in
determining Medi-Cal eligibility for certain
individuals.
2. Prohibits DHCS from applying an assets or resources test
for purposes of determining eligibility for Medi-Cal,
except for individuals described in federal law,
notwithstanding any other provision of state law and to
the extent required by federal law.
3. Requires DHCS to use the MAGI of an individual and, in
the case of an individual in a family, the household
income of the family for the purposes of determining
income eligibility for Medi-Cal when a determination of
income is required, and when determining premiums and
cost-sharing under Medi-Cal.
4. Requires DHCS to establish income eligibility thresholds
for populations eligible for Medi-Cal that are not less
than the effective income eligibility levels that are
applied under Medi-Cal on March 23, 2010.
5. Requires DHCS, during the transition to the use of MAGI
and household income, to work with the federal Secretary
of the Department of Health and Human Services to
establish an equivalent income test that ensures
individuals eligible for Medi-Cal on March 23, 2010 (the
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effective date of Patient Protection and Affordable Care
Act �PPACA]) do not lose coverage under Medi-Cal for
purposes of the federal Medicaid maintenance of effort.
6. Exempts from the provisions of this bill the same
individuals who are exempt under federal law from the
new MAGI and asset test provisions (for example,
individuals age 65 and over, and individuals dually
eligible for Medicaid and Medicare).
7. Prohibits any type of expense, block, or other income
disregard (an income disregard is income that is
"disregarded" or not counted for Medi-Cal eligibility
purposes) from being applied by DHCS to determine income
eligibility for Medi-Cal, or for any other purpose
applicable under Medi-Cal for which an income
determination is required, except for the five percent
income disregard in PPACA.
8. Makes the provisions of this bill operative on January
1, 2014.
9. Specifies that its provisions shall only be enacted to
the extent required by federal law and requires DHCS to
adopt regulations in accordance with this bill.
Background
In California, individuals or families can qualify for
Medi-Cal coverage through a variety of Medi-Cal programs.
Some individuals have automatic eligibility for Medi-Cal
because they receive cash assistance from other programs,
such as CalWORKs, SSI/SSP, Foster Care or Adoption
Assistance, and no separate application for Medi-Cal is
required in addition to the application for these benefits.
Other individuals qualify for Medi-Cal if the individual
is in a Medi-Cal coverage category (such as individuals who
are age 65 or older, a child, or a family with children)
and has income and resources below the prescribed limit for
the coverage category.
The income and asset eligibility standards currently vary
across states, and different standards apply to different
groups within states. For example, children and pregnant
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women in California are eligible for Medi-Cal without an
asset test, while families under the 1931(b) coverage
category have an asset test. Section 1931(b) Medi-Cal is
the largest Medi-Cal coverage category. It provides no
cost Medi-Cal for CalWORKs beneficiaries as well as those
families who do not receive CalWORKs but who would meet the
income and resource standards for Aid to Families with
Dependent Children as it existed prior to federal changes
to welfare in 1996. If the applicant family's income is at
or below 100 percent of the federal poverty level and meets
other Medi-Cal requirements, the family is eligible for
1931(b) Medi-Cal.
In determining income under for Section 1931(b) Medi-Cal,
certain types of income are exempt (not counted) for
recipients and applicants in determining Medi-Cal income
eligibility. Examples of exempt income include public
assistance payments (CalWORKs, CalWORKs diversion payments,
foster care payments, general relief, SSI) and the
employment earnings of a child under age 14, or a child
under age 19 if the child is a full-time student or a
part-time student who is not employed full-time.
In addition to exempting certain types of income, Section
1931(b) Medi-Cal also allows for income deductions for
purposes of determining Medi-Cal eligibility. Deductions
are amounts subtracted from an applicant's income. For
applicants, monthly deductions include $90 of earned income
per working person, dependent care costs with a maximum of
$200 per month per child under two years and $175 per month
if the child is older than two, court-ordered child support
or alimony paid by the applicant, educational expenses
(including tuition, books, fees, supplies, travel and child
care), and self-employed business expenses.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
Fiscal Impact (in thousands)
Major Provisions 2012-13 2013-14 2014-15 Fund
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Developing regulations Up to $800 over two
yearsGeneral/
Federal*
Changes to Medi-Cal Unknown, potentially
significant General/
eligibility costs
Federal*
* 50% General Fund and 50% federal funds
SUPPORT : (Verified 1/23/12)
American Federation of State, County and Municipal
Employees
California Mental Health Directors Association
California State Association of Counties
County Health Executives Association of California
County Welfare Directors Association
Urban Counties Caucus
Western Center on Law and Poverty
ARGUMENTS IN SUPPORT : Western Center on Law and Poverty
(WCLP) writes in support of this bill that it would
simplify the Medi-Cal eligibility rules by 2014 as required
by PPACA. WCLP writes that this bill rightly requires
California to establish income levels using the MAGI rules
that are not less than the effective income levels today.
WCLP states that many complain that Medi-Cal administration
and eligibility determinations are too cumbersome and
complicated, and this bill importantly simplifies income
and assets rules, thus allowing for a more efficient and
streamlined program. WCLP concludes that this bill also
achieves alignment of the Medi-Cal income, assets, and
household rules with the rules in the California Health
Benefit Exchange as needed for a streamlined application
and enrollment system.
CTW:kc:mw 1/23/12 Senate Floor Analyses
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SUPPORT/OPPOSITION: SEE ABOVE
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