BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 617|
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THIRD READING
Bill No: AB 617
Author: Nazarian (D)
Amended: 8/22/14 in Senate
Vote: 21
SENATE HEALTH COMMITTEE : 9-0, 7/3/13
AYES: Hernandez, Anderson, Beall, De Le�n, DeSaulnier, Monning,
Nielsen, Pavley, Wolk
SENATE APPROPRIATIONS COMMITTEE : 5-0, 8/14/14
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NO VOTE RECORDED: Walters, Gaines
ASSEMBLY FLOOR : 54-24, 5/28/13 - See last page for vote
SUBJECT : California Health Benefit Exchange: appeals
SOURCE : Western Center on Law and Poverty
DIGEST : This bill requires the California Health Benefits
Exchange (Covered California) board to contract with the
Department of Social Services (DSS) to serve as the Covered
California entity designated to hear appeals of eligibility or
enrollment determination or redetermination for persons in the
individual market or exemption determinations within Covered
California's jurisdiction. This bill establishes an appeals
process for eligibility or enrollment determinations and
redeterminations for insurance affordability programs, as
defined, or exemption determinations within Covered California's
jurisdiction, including an informal resolution process, as
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specified, establishing procedures and timelines for hearings
with the appeals entity, and notice provisions. This bill also
establishes a process for continuing eligibility for individuals
during the appeals process, makes other related changes, and
specifies that certain provisions will only be implemented to
the extent they do not conflict with federal law.
Senate Floor Amendments of 8/22/14 require a combined
eligibility notice that informs an individual or multiple family
members of eligibility for each insurance affordability program;
implement this requirement when the Department of Health Care
Services (DHCS) determines that the California Healthcare
Eligibility, Enrollment and Retention System (CalHEERS) has been
programmed for implementation, but not later than July 1, 2017.
ANALYSIS :
Existing federal law:
1. Requires, under the Affordable Care Act (ACA), each state, by
January 1, 2014, to establish an American Health Benefit
Exchange (Exchange) that makes qualified health plans (QHPs)
available to qualified individuals and qualified employers.
Requires, if a state does not establish an Exchange, the
federal government to administer the Exchange. Establishes
requirements for the Exchange and for participating QHPs, and
defines who is eligible to purchase coverage in the Exchange.
2. Allows, under the ACA and effective January 1, 2014, eligible
individual taxpayers, whose household income is between 100
and 400% of the Federal Poverty Limit, an advanceable and
refundable premium tax credit (APTC) based on the
individual's income for coverage under a QHP offered in the
Exchange.
3. Requires, under the ACA, the federal Secretary of Health and
Human Services (HHS) to establish a system meeting specified
requirements under which residents of each state can apply
for enrollment, receive a determination of eligibility for
participation, and continue participation in, applicable
state health insurance affordability programs.
Existing state law:
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1. Establishes the Covered California as the state's health
benefit exchange, and specifies its duties and authority.
Requires Covered California be governed by a board that
includes the Secretary of the California Health and Human
Services Agency (Agency) and four members with specified
expertise who are appointed by the Governor and the
Legislature.
2. Permits Covered California to adopt rules and regulations, as
necessary. Permits, until January 1, 2016, any necessary
rules and regulations to be adopted as emergency regulations.
3. Requires Covered California to establish an appeals process
for prospective and current enrollees of Covered California
that complies with all requirements of the ACA concerning the
role of a state Exchange in facilitating federal appeals of
Exchange-related determinations.
4. Prohibits, in no event, the scope of those appeals from being
construed to be broader than the requirements of the ACA.
5. Permits Covered California, once the federal regulations
concerning appeals have been issued in final form by the
federal Secretary of HHS, to establish additional
requirements related to appeals, provided that the Covered
California board determines, prior to adoption, that any
additional requirement results in no cost to the General Fund
and no increase in the charge imposed on QHPs to fund Covered
California.
6. Prohibits Covered California from being required to provide
an appeal if the subject of the appeal is within the
jurisdiction of the Department of Managed Health Care, or
within the jurisdiction of the Department of Insurance.
This bill:
1. Requires the appeals process to allow for appeals of
eligibility determinations for Medi-Cal, the Medi-Cal Access
Program (the successor to the Healthy Families Program), and
subsidized coverage purchased through Covered California.
2. Designates DSS as the appeals entity.
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3. Specifies the process and timelines for notification to
applicants.
4. Requires the Covered California board to enter into a
contract with DSS to serve as the Exchange appeals entity
designated to hear appeals of eligibility or enrollment
determination or redetermination for persons in the
individual market, or exemption determinations within Covered
California's jurisdiction. Specifies that to the extent
applicable, the provisions of this title, the Code of Federal
Regulations, and the California Code of Regulations shall
govern the Covered California hearing process. Provides that
if those provisions are not applicable, the Medi-Cal hearing
process, as established in existing law shall govern the
Covered California hearing process.
5. Authorizes an informal resolution process that an applicant
may request.
6. Requires the appeals entity to accept applications in
person.
7. Authorizes an applicant to request an expedited appeals
hearing when there is an immediate need for health care
services.
8. Requires a decision in an expedited appeal to be issued
within five days after the hearing, unless the applicant
agrees to a delay.
9. Requires the entity making an eligibility or enrollment
determination to provide notice of the appeals process at the
time of application and at the time of eligibility or
enrollment determination or redetermination.
10.Requires the entity making an eligibility or enrollment
determination to also issue a combined eligibility notice
after the Director of DHCS determines in writing that
CalHEERS has been programmed for the implementation of these
provisions, but no later than July 1, 2017. Requires the
combined eligibility notice to contain information about
eligibility or ineligibility for Medi-Cal, premium tax
credits and cost-sharing reductions, and, if applicable, for
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the Medi-Cal Access Program for each individual, or multiple
family members of a household, that has applied, including
all of the following:
A. An explanation of the action reflected in the notice,
including the effective date of the action.
B. Any factual bases upon which the decision is made.
C. Citations to, or identification of, the legal
authority supporting the action.
D. Contact information for available customer service
resources, including local legal aid and welfare rights
offices. The effective date of eligibility and
enrollment.
1. Requires DHCS to adopt implementing regulations by July 1,
2017.
2. Specifies that these provisions will be implemented only to
the extent they do not conflict with federal law.
Comments
Federal regulations . Proposed federal regulations issued in
January 2013 establish minimum federal requirements and state
policy options for appeals of eligibility determinations for
participation in Exchanges and insurance affordability programs.
For example, federal regulations require that an applicant or
enrollee has the right to appeal:
1. An eligibility determination, including an initial
determination of eligibility (including for an APTC and
cost-sharing reduction);
2. A redetermination of eligibility, including the amount of
the APTC and level of cost-sharing reduction;
3. An eligibility determination from the individual
responsibility requirement (commonly known as the individual
mandate); or,
4. A failure by the Exchange to provide timely notice of an
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eligibility determination.
Federal regulations require that appeals be accepted by
telephone, mail, in person (if capable) or via the Internet, and
must be submitted within 90 days of the date of the notice of
eligibility determination. Federal regulations also establish
requirements for eligibility pending an appeal, expedited
appeals, and appeal decisions. States are given options in
implementing the appeals. These options include which entity
may conduct the appeals (the Exchange, the federal HHS, after
exhausting state-based appeals), whether the Exchange and the
appeals entity is allowed to assist applicants/enrollees in
making an appeals request, and whether the Exchange provides an
informal resolution process prior to a hearing.
Prior Legislation
SB 900 (Alquist, Chapter 659, Statutes of 2010) establishes
Covered California as an independent public entity within state
government, and requires Covered California to be governed by a
board composed of the Secretary of the Agency, or his/her
designee, and four other members appointed by the Governor and
the Legislature who meet specified criteria.
AB 1602 (John A. P�rez, Chapter 655, Statutes of 2010) specifies
the powers and duties of Covered California relative to
determining eligibility for enrollment and arranging for
coverage under QHPs.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Annual costs of $630,000 for additional staff to perform
expedited appeal hearings (General Fund and federal funds).
This bill authorizes applicants to request an expedited
appeal, which requires a decision to be issued within five
days. By accelerating the appeals timeline, this bill will
increase administrative workload to DSS.
One-time administrative costs in the low hundreds of thousands
to develop and adopt regulations to implement the requirements
of this bill (General Fund and federal funds).
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SUPPORT : (Verified 8/25/14)
Western Center on Law and Poverty (source)
California Advocates for Nursing Home Reform
Children Now
Children's Defense Fund-California
Coalition of California Welfare Rights
Disability Rights California
Greenlining Institute
Health Access California
National Health Law Program
Organizations, Inc.
Public Law Center
The Children's Partnership
ARGUMENTS IN SUPPORT : According to the author's office, this
bill complements other ACA-related legislation by establishing a
"no wrong door" appeals procedure for both Medi-Cal and Exchange
determinations and ensures that people are enrolled and
receiving benefits from health care coverage programs they can
afford. The author's office writes that this bill ensures that
no matter where a consumer decides to apply for coverage that
there is a defined process in place as to next steps, should
they need to appeal a decision.
Western Center on Law and Poverty (WCLP), sponsor of this bill,
states that the ACA requires a new seamless and coordinated
eligibility and enrollment system for Medi-Cal, the Exchange,
and the Access for Infants and Mothers Program. WCLP states
that DHCS and Covered California are working to realize this
vision, including overseeing the building of an online
application for health coverage programs as well as providing
for in-person, phone, and mail application venues. WCLP argues
that legislation is needed to specify notice and appeals
procedures.
ASSEMBLY FLOOR : 54-24, 5/28/13
AYES: Achadjian, Alejo, Ammiano, Atkins, Bloom, Blumenfield,
Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian
Calderon, Campos, Chau, Chesbro, Cooley, Daly, Dickinson,
Eggman, Fong, Fox, Frazier, Garcia, Gatto, Gomez, Gonzalez,
Gordon, Gray, Hall, Roger Hern�ndez, Jones-Sawyer, Levine,
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Lowenthal, Medina, Mitchell, Mullin, Muratsuchi, Nazarian,
Pan, Perea, V. Manuel P�rez, Quirk, Quirk-Silva, Rendon,
Salas, Skinner, Stone, Ting, Weber, Wieckowski, Williams,
Yamada, John A. P�rez
NOES: Allen, Bigelow, Ch�vez, Conway, Dahle, Donnelly, Beth
Gaines, Gorell, Grove, Hagman, Harkey, Jones, Linder, Logue,
Maienschein, Mansoor, Melendez, Morrell, Nestande, Olsen,
Patterson, Wagner, Waldron, Wilk
NO VOTE RECORDED: Holden, Vacancy
JL:k 8/25/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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