BILL ANALYSIS �
AB 617
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 617 (Nazarian)
As Amended August 22, 2014
Majority vote
-----------------------------------------------------------------
|ASSEMBLY: |54-24|(May 28, 2013) |SENATE: |25-9 |(August 26, |
| | | | | |2014) |
-----------------------------------------------------------------
Original Committee Reference: HEALTH
SUMMARY : Establishes an appeals process for eligibility
determinations for insurance affordability programs (including
Medi-Cal and tax credits available through the California Health
Benefit Exchange (Exchange), or Covered California) and requires
Covered California to contract with the Department of Social
Services (DSS) to serve as the designated entity to hear
appeals. Specifically, this bill :
1)Applies to eligibility for Medi-Cal, the state's children's
health insurance program, federal tax credits that subsidize
the purchase of health plans through Covered California, and
cost-sharing reductions available for Covered California
plans.
2)Requires Covered California to contract with DSS to serve as
the appeals entity. Requires the Exchange hearing process, to
the extent applicable, to be governed by the provisions of
this bill, federal regulations on Exchange appeals, and
Covered California's regulations on Exchange appeals. If
those provisions are not applicable, requires Medi-Cal hearing
process rules to govern appeals hearings.
3)Requires the entity making enrollment or eligibility
determinations, including the amounts of tax credits and
cost-sharing determinations, to provide notice of the appeals
process at the time of application and at the time of
determination or redetermination of eligibility.
4)Specifies deadlines and time lines to request an appeal and
establishes an expedited appeals process for situations where
there is immediate need for health services.
5)Provides for the opportunity for an informal resolution prior
AB 617
Page 2
to the hearing as specified, and prohibits the informal
resolution process from being mandatory, delaying the timeline
for provision of a hearing, or having an effect on the right
to a hearing.
The Senate amendments :
1)Require a combined eligibility notice to be sent only after
DHCS determines in writing that the California Healthcare
Eligibility, Enrollment, and Retention System (CalHEERS) has
been programmed for the implementation of this bill.
2)Clarify that notice of the appeals process must be provided at
the time of redetermination of eligibility, in addition to the
time of initial determination.
3)Require expedited appeals to be decided within five working
days, rather than three, and require notice of a denied
expedited appeal within three working days, rather than two.
4)Replace references to the Managed Risk Medical Insurance Board
(MRMIB) with the Department of Health Care Services (DHCS) to
reflect the elimination of MRMIB and the transition of its
functions to DHCS.
5)Requires the informal resolution process to require the entity
that determined eligibility to review the appellant's file,
attempt to resolve the matter, determine whether
interpretation services are needed, and inform appellants of
other agencies that may be able to resolve the issue, and make
other determinations about the need for a hearing.
6)Delete a requirement that hearings be held in person unless
the appellant requests otherwise, and instead allows hearings
to be held via telephone or video conference unless the
appellant requests that the hearing be held in person.
7)Clarify that an appellant's appeal to the federal Department
of Health and Human Services does not preclude judicial
review.
8)Provide that this bill shall be implemented only to the extent
that it does not conflict with federal law.
9)Make numerous additional minor and technical changes.
AB 617
Page 3
FISCAL EFFECT : According to the Senate Appropriations
Committee:
1)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.
2)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).
COMMENTS : According to the author, this bill ensures the
overall purpose of the federal Patient Protection and Affordable
Care Act (ACA) is achieved: that people are enrolled and
receiving benefits from healthcare coverage programs they can
afford. The author states, consistent with the goal of the ACA,
this bill implements a coordinated, statewide approach on
appeals to facilitate the process and to seamlessly enroll
consumers in health coverage. This bill is intended to ensure
that no matter where a consumer decides to apply for coverage
there is a defined process in place as to next steps, should
they need to appeal a decision. The author states that this
bill also includes an informal resolution process, as specified
by the ACA, to avoid going to hearing when possible.
The ACA's expansion of access to health insurance began in 2014
with a coordinated system of insurance affordability programs,
including Medicaid (known as Medi-Cal in California), the
Children's Health Insurance Program (which includes certain
children and pregnant mothers in, tax credits (which apply
directly to a consumer's premium payment each month) for
coverage provided through exchanges, and optional
state-established Basic Health Plans. It also provides for
coordinated, streamlined enrollment processes for these
programs. State Medicaid agencies are required to enter into
agreements with the Exchange and other insurance affordability
programs to coordinate eligibility determinations and
enrollment.
In addition to having a streamlined eligibility and enrollment
application system, the ACA and its implementing regulations
AB 617
Page 4
require states to have coordinated notice and appeal procedures.
The federal Centers for Medicare and Medicaid Services issued
final regulations governing exchanges effective September 30,
2013. These regulations covered, among other things, fair
hearing and appeals processes for Medicaid and exchange
eligibility and enrollment appeals. In June 2014, Covered
California adopted regulations on the eligibility and enrollment
appeals process for California. The provisions of this bill,
which were developed in coordination with DHCS, DSS, and Covered
California, are generally similar to those regulations.
Western Center on Law and Poverty, the sponsor of this bill,
writes in support that the ACA requires a new seamless and
coordinated eligibility and enrollment system for the health
insurance affordability programs. DHCS and the Exchange are
working to realize this vision by overseeing the building of
CalHEERS to be the online application for public health coverage
programs as well as providing for in-person, phone, and mail
application venues. Just as the application processes must be
coordinated, federal law also requires that notices and appeals
be coordinated. Western Center argues that, while Covered
California has adopted regulations on the appeals process,
something as important as due process rights belongs in statute.
There is no opposition on file.
Analysis Prepared by : Ben Russell / HEALTH / (916) 319-2097
FN: 0005475