BILL ANALYSIS �
SB 18
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Date of Hearing: June 24, 2014
ASSEMBLY COMMITTEE ON HEALTH
Richard Pan, Chair
SB 18 (Ed Hernandez and Leno) - As Amended: June 18, 2014
SENATE VOTE : Not relevant.
SUBJECT : Medi-Cal renewal.
SUMMARY : Requires the Department of Health Care Services (DHCS)
to accept contributions by private foundations in the amount of
at least $6 million for the purposes of providing Medi-Cal
renewal assistance payments, starting January 1, 2015.
Specifically, this bill :
1) Requires the $6 million in contributions to be deposited
in the Healthcare Outreach and Medi-Cal Enrollment Account
within the State Treasury, and appropriates the
contributions to DHCS, to be available for encumbrance or
expenditure until December 31, 2016.
2) Authorizes DHCS to make allocations from the
contributions to fund Medi-Cal renewal assistance
activities, and requires funding allocation to be used only
for Medi-Cal renewal assistance activities, and prohibits
the funds from supplanting existing local, state, and
foundation funding of any county renewal assistance
activities.
3) Requires DHCS to seek federal matching funds for the
contributions to the extent permissible for training,
testing, certifying, supporting, and compensating persons
and entities providing renewal assistance, and for any
other permissible renewal assistance-related activities.
4) Requires DHCS to seek all necessary federal approvals
for purposes of obtaining the federal funding, and that, to
the extent federal funding is received, reimbursements for
costs incurred under the approved allocations be made in
compliance with federal law.
5) Requires payments for renewal assistance to be
distributed to community-based organizations providing
renewal assistance to Medi-Cal beneficiaries. Requires
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DHCS to make authorized payments to counties for
distribution of funds to community-based organizations, and
authorizes counties to retain an amount for administrative
costs that have been approved by the department.
6) Authorizes DHCS to determine the number of allocations
and the process to apply for an allocation, and to consult
or obtain technical assistance from private foundations in
implementation of the application and allocation process.
7) Authorizes DHCS to consider distributing funds to
community-based organizations in an area or region of the
state if a county or counties acting jointly do not seek an
allocation, or funds are made available.
8) Requires DHCS, in collaboration with the County Welfare
Directors Association, to develop renewal assistance
training for employees of community-based organizations
that are to be consistent with the counties' human services
agencies Medi-Cal redetermination timeframes and process,
and requires the community-based organizations' employees
providing renewal assistance to complete this training in
order to be eligible for renewal assistance payments.
9) Requires DHCS to require progress reports from those
receiving funding allocations.
10) Authorizes DHCS to recoup or withhold all or part of an
allocation for failure to comply with any requirements or
standards set forth by the department.
11) Authorizes DHCS to expend a portion of $500,000
authorized for expenditures relating to Medi-Cal outreach
and enrollment funded by previous private foundation
contributions and matching federal funds to administer the
activities set forth in this bill. Requires private
foundation funding to be expended only for filled positions
and related administrative expenses.
12) Authorizes DHCS to implement, interpret, or make
specific the provisions of this bill by means of all-county
letters, provider bulletins, or similar instructions.
13) Requires the provisions of this bill to cease to be
implemented when all of the private foundation
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contributions and any federal matching funds have been
exhausted.
EXISTING LAW :
1) Establishes the Medi-Cal program, administered by DHCS,
under which low-income individuals are eligible for medical
coverage.
2) Requires DHCS to, pursuant to the federal Patient
Protection and Affordable Care Act (ACA), to expand
Medi-Cal coverage to adults and parents up to 133% of the
federal poverty limit.
3) Requires, effective January 1, 2014, when determining
Medi-Cal eligibility for non-elderly non-disabled adults,
an applicant's or beneficiary's income and resources to be
determined, counted, and valued in accordance with the
requirements of a provision of the ACA which prohibits the
use of an assets or resources test for individuals whose
income eligibility is determined based on Modified Adjusted
Gross Income (MAGI).
4) Requires the annual redetermination process used to
renew Medi-Cal coverage for Medi-Cal beneficiaries with
MAGI-based eligibility to be streamlined and simplified.
5) Authorizes DHCS to accept contributions by private
foundations in the amount of at least $26.5 million, and to
obtain an equal amount of federal matching funds, to
support and fund Medi-Cal outreach and enrollment
activities, as well as payments for in-person Medi-Cal
enrollment assistance. Authorizes DHCS to, from the
private foundation funds and matching federal funds, expend
in aggregate up to $500,000 annually in fiscal years
2013-14, 2014-15, and 2015-16 to administer the activities
related to the Medi-Cal outreach and enrollment activities
and enrollment assistance, as specified.
FISCAL EFFECT : This bill, as amended, has not been analyzed by
a fiscal committee.
COMMENTS :
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1) PURPOSE OF THIS BILL . According to the author, this
bill provides the mechanism necessary to obtain federal
matching dollars for $6 million The California Endowment
(The Endowment), a private health foundation that provides
grants to community-based organizations throughout
California, is willing to contribute to help individuals
renew their Medi-Cal coverage. The author states, as part
of its work in leading the nation on the implementation of
the ACA, California has developed an outreach and
enrollment infrastructure of community-based organizations
and county employees who have assisted millions of
Californians to enroll in Covered California and Medi-Cal.
The author adds that these Californians will need to renew
their coverage in order to keep it for the year 2015, and
that renewal assistance will be particularly important in
2014-15 as existing Medi-Cal enrollees move from
welfare-based income and household eligibility rules to
MAGI-based eligibility rules. Due to the changes in these
eligibility rules, the Medi-Cal renewal forms for 2014 are
particularly confusing and additional support will be
needed to assist applicants for renewal to complete the
forms. The author notes that counties are working through
a tremendous backlog of applications for initial
enrollment, and would benefit from added assistance from
community-based organizations helping consumers through the
renewal process. The author concludes that without this
legislation, and funding from The Endowment, there is no
funding for community groups to assist consumers in
renewing their Medi-Cal coverage.
2) BACKGROUND .
a) Previous private contributions for Medi-Cal outreach and
enrollment. In 2013, The Endowment committed $26.5 million
to the state in an effort to help increase and enhance
outreach and enrollment efforts in Medi-Cal, and support
enrollment for up to 450,000 Medi-Cal applicants. AB 82
(Committee on Budget), Chapter 23, Statutes of 2013
authorizes DHCS to accept the private foundation funds, and
to secure an equal amount in federal matching funds, to be
used for the following purposes:
i) Medi-Cal in-person enrollment assistance payments.
Of the $26.5 million contribution, $14 million is
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designated for enrollment assistance payments to
Certified Enrollment Counselors (CECs) and Certified
Insurance Agents (CIAs) in the amount of $58 for each
approved Medi-Cal application submitted by applicants
newly eligible for Medi-Cal under the ACA, or applicants
not enrolled in Medi-Cal for 12 months prior to the
application date. Individuals wishing to qualify as a
CEC or CIA must receive training and be deemed eligible
to receive the in-person enrollment assistance payments
by Covered California. According to DHCS, payments for
in-person application assistance that resulted in
Medi-Cal enrollments were set to begin by the end of May
2014. Payments are issued by Covered California.
ii) Local Medi-Cal outreach and enrollment efforts. The
remainder of the $26.5 million contribution, or $12.5
million, is to supplement counties' existing funding for
Medi-Cal outreach and enrollment efforts associated with
implementation of ACA. Funding allocations are
apportioned geographically according to estimated number
of persons who are eligible but not enrolled in Medi-Cal,
and who are newly eligible for Medi-Cal as of January 1,
2014. Further, the funding will be given only to
outreach and enrollment efforts targeting specific
populations, including persons with mental health or
substance use disorder needs, persons who are homeless,
young men of color, and persons with limited-English
proficiency. Counties may partner with community-based
organizations to conduct outreach and enrollment efforts,
and are required to specify the organizations with which
they will share funding as part of the grant application
process. Funding recipients are required to submit
progress reports and program outcomes to DHCS. According
to DHCS, payment to outreach and enrollment grantees was
began on February 1, 2014.
Enrollment for coverage under the Medi-Cal expansion began
on October 1, 2013. Through the end of March 2014,
Medi-Cal enrolled approximately 1.9 million people
through Covered California and county offices. Total
Medi-Cal enrollment is projected to 11.5 million in
2014-15, or approximately 30% of the total state
population.
As of May 1, 2014, approximately 900,000 Medi-Cal
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applications were pending due to problems with the
California Health Eligibility Enrollment and Retention
System (CalHEERS), the information technology system
designed to determine Medi-Cal eligibility.
b) Medi-Cal annual redetermination process. While previous
private foundation funds were used to support Medi-Cal
outreach and enrollment, under this bill, private
foundation dollars will be used for the purposes of renewal
assistance.
The ACA requires states to change the way they calculate
income for purposes of determining Medicaid (Medi-Cal in
California) eligibility. Prior to ACA implementation,
eligibility determinations under California law used asset
or resource tests and state income disregards which allow
certain types of income from being counted toward Medi-Cal
eligibility. However, pursuant to the ACA, beginning
January 1, 2014, eligibility for Medi-Cal must be
determined using methodologies based on MAGI.
The use of MAGI-based eligibility requirements necessitated a
change to the annual redetermination forms previously used
to process renewals. DHCS now requires new forms in order
to collect the necessary income and tax household
information that is missing from their current Medi-Cal
case in order to conduct a MAGI eligibility determination.
For the purposes of Medi-Cal coverage renewal, current law
requires the annual eligibility redetermination for those
individuals subject to Medi-Cal benefits on the basis of
MAGI to be streamlined and simplified. Medi-Cal
beneficiaries will have their annual redeterminations
conducted via an "ex parte" review of available
information, meaning that eligibility workers will conduct
a review of current beneficiary data and information before
asking the beneficiary to provide additional data. The ex
parte review is a main tenet of streamlining and
simplifying the renewal process, since a beneficiary may
not be required to complete additional redetermination
forms if sufficient information is available to renew
coverage during the ex parte review.
Due to the implementation of MAGI-based eligibility
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requirements, new information regarding federal tax
household and income is needed from Medi-Cal beneficiaries
who enrolled prior to ACA implementation in order to
determine their eligibility under MAGI. As such, an ex
parte review process will not be available for pre-ACA
beneficiaries seeking renewal in 2014, because counties
will be required to collect additional information from
these beneficiaries in order to complete the
redetermination. It is anticipated that the ex parte
review process will be utilized for redeterminations
conducted in 2015.
3) SUPPORT . The Western Center on Law and Poverty (WCLP),
a cosponsor of this bill, states that the role of
community-based organizations in assisting consumers with
enrollment into Medi-Cal has been critical to the progress
California has made in expanding the program and
streamlining eligibility rules. WCLP states it is
similarly important to have community-based organizations
assist beneficiaries in renewing their Medi-Cal coverage,
particularly given the shift under the ACA to MAGI
eligibility rules. WCLP states that there are different
eligibility rules for children and adults which could
result in families having parents enrolled in a Covered
California plan and children enrolled in Medi-Cal. As
such, renewal assistance is vital to ensure eligible
children keep their Medi-Cal coverage. WCLP asserts that
the new Medi-Cal renewal application is confusing, and that
while there should be many improvements to the renewal
process in 2015, due to the implementation of ex parte
review and the use of prepopulated forms, this will be a
different type of renewal process for which beneficiaries
must adapt. WCLP also states that this bill provides
resources to community groups to assist consumers with
renewals, thereby allowing state and county workers to
rightfully focus on reducing the state's significant
backlog of Medi-Cal applications.
Health Access California, also a cosponsor of this bill,
states that The Endowment has generously offered $6 million
to assist consumers who are enrolled in Medi-Cal to renew
that their coverage, and that this bill would allow a
federal match for those dollars. Health Access states that
keeping eligible beneficiaries enrolled in coverage assures
ongoing access to medically necessary care and reduces
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administrative overhead due to avoidable churning of
enrollment. Further, Health Access California states that
this bill uses the same mechanism in place today to grant
money to community organizations that assist consumers in
signing up for Medi-Cal thereby building upon an existing
infrastructure of enrollment assistance at no cost to the
General Fund.
1)PREVIOUS LEGISLATION . AB 82 (Committee on Budget), Chapter
23, Statutes of 2013, the health budget trailer bill,
authorizes DHCS to accept contributions by private foundations
in the amount of at least $26.5 million, and to seek matching
federal funds, for the purposes of funding in-person
enrollment assistance payments and Medi-Cal outreach and
enrollment plans.
REGISTERED SUPPORT / OPPOSITION :
Support
Health Access California (cosponsor)
Western Center on Law and Poverty (cosponsor)
Asian Law Alliance
California Coverage and Health Initiatives
California Immigrant Policy Center
California Optometric Association
California Pan-Ethnic Health Network
California Primary Care Association
Children Now
Children's Defense Fund-California
Korean Community Center of the East Bay
National Health Law Program
National Immigration Law Center
PICO California
SEIU United Healthcare Workers - West
Services, Immigrant Rights, and Education Network
The Children's Partnership
United Ways of California
Opposition
None on file.
Analysis Prepared by : Kelly Green / HEALTH / (916) 319-2097
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