BILL ANALYSIS �
AB 2025
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Date of Hearing: April 9, 2014
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 2025 (Dickinson) - As Amended: March 18, 2014
Policy Committee: HealthVote:13-1
Urgency: No State Mandated Local Program:
Yes Reimbursable: Yes
SUMMARY
This bill expands income eligibility for Medi-Cal for aged,
blind, or disabled individuals through the Aged and Disabled
Federal Poverty Line (A&D FPL) program from a threshold that is
effectively 124% of the federal poverty level, to 138% of the
federal poverty level.
FISCAL EFFECT
1)Increased costs to the Medi-Cal program, likely in the
hundreds of millions of dollars annually. Precise data on how
many individuals would meet the expanded income threshold as
well as other eligibility requirements are not readily
available. If enrollment in the A&D FPL program increased by
1%, costs in this program could increase by $183 million, with
offsetting cost decreases in the "Share of Cost" (SOC) program
of $73 million, leaving a net cost of $110 million
(GF/federal).
This estimate assumes Medi-Cal pays half as much on average
for an enrollee in SOC Medi-Cal as compared to an enrollee in
the full-scope A&D FPL program, and that 80% of individuals
gaining full-scope coverage due to this bill are currently
enrolled in SOC Medi-Cal. To the extent enrollment increased
more than 1%, or that more individuals are new enrollees
instead of existing SOC enrollees, net costs would be higher.
2)Potential additional cost avoidance to Medi-Cal, to the extent
the individuals who gain comprehensive coverage through this
coverage expansion remain healthier and avoid more costly
institutional care. Annual per-person costs for institutional
long-term care range from $65,000 to $90,000 per year for this
AB 2025
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population.
COMMENTS
1)Purpose . The author states increasing the income threshold to
allow more aged, blind, and disabled individuals to receive
Medi-Cal without a share of cost addresses two problems: (1)
it brings income eligibility for elderly and disabled
individuals in line with that for non-elderly, non-disabled
individuals, and (2) it allows these individuals to qualify
for comprehensive Medi-Cal benefits instead of the
"share-of-cost" Medi-Cal, which effectively amounts to
catastrophic coverage for most people who qualify.
2)Medi-Cal Eligibility . Eligibility rules have been simplified
for certain populations as a result of the Affordable Care Act
(ACA). Pursuant to ACA and California's decision to expand
Medi-Cal, individuals under 65 are generally able to qualify
based strictly on a Modified Adjusted Gross Income (MAGI) of
under 138% of the federal poverty level. This creates a
so-called "bright line" at 138% of poverty for the majority of
enrollees. However, eligibility for certain populations,
including the aged, blind, and disabled, is still determined
under more complicated old rules that account for numerous
factors such as income levels, income disregards, and a
person's assets.
This bill would allow aged, blind, and disabled individuals
with incomes between approximately 124% and 138%, many of whom
currently qualify for "Share of Cost" (SOC) Medi-Cal, to
qualify for comprehensive Medi-Cal benefits without a share of
cost. SOC Medi-Cal is effectively catastrophic-only coverage.
The individuals targeted by this bill who qualify for SOC
Medi-Cal have to "spend down" over $600 out of pocket on
health care in a given month before they receive any Medi-Cal
benefits. This bill would instead allow them to receive full
Medi-Cal with no SOC. Aged, blind, and disabled individuals
with incomes over the new 138% threshold would still qualify
for SOC Medi-Cal.
3)Prior Legislation . AB 2877 (Thomson), Chapter 93, Statutes of
2000, the health budget trailer bill, establishes the A&D FPL
program, a no-share-of-cost Medi-Cal benefit for many elderly
and disabled recipients who previously had to pay a
significant share of cost to access Medi-Cal services.
AB 2025
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AB 969 (Chan) of 2001, which incorporated annual
cost-of-living increases in the A&D FPL formula, was held in
the Senate Appropriations Committee.
AB 55 (Dymally) of 2007 was substantially similar to this
bill, but increased the income threshold to 133% of FPL
instead of 138%. It was amended to a different subject matter
before its first policy hearing in the Senate.
Analysis Prepared by : Lisa Murawski / APPR. / (916) 319-2081