BILL ANALYSIS
AB 1863
Page 1
Date of Hearing: April 4, 2000
ASSEMBLY COMMITTEE ON HEALTH
Martin Gallegos, Chair
AB 1863 (Gallegos) - As Amended: March 30, 2000
SUBJECT : Medi-Cal: eligibility.
SUMMARY : Establishes a free Medi-Cal eligibility program for
aged and disabled people and reduces the Medi-Cal share of cost
requirements for medically needy people and families with too
much income to qualify for free Medi-Cal. Specifically, this
bill :
1)Increases, beginning January 1, 2001, the income levels for
maintenance in effect August 22, 1996, by a percentage equal
to the intervening consumer price index increases but not more
than 10%, and by a percentage equal to the Consumer Price
Index on January 1 of each subsequent year.
2)Establishes Medi-Cal eligibility as follows for an individual
meeting the following requirements:
a)His or her net income does not exceed 100% of the federal
poverty level.
b)He or she is 65 years of age or older or is disabled as
determined under the federal Social Security Act (SSA).
c)His or her net nonexempt resources, as determined under the
federal SSA, do not exceed the maximum allowable amounts,
as specified.
3)Provides for certain deductions, exemptions, and disregards of
earned and unearned income, as provided under the federal SSA,
and authorizes additional deductions from income in the amount
of $200 for individuals, and $400 for couples for the purposes
of determining income pursuant to #2 above.
4)Requires the Department of Health Services (DHS) to seek
approvals for federal financial participation, and authorizes
the Attorney General to file administrative and judicial
proceedings to obtain federal approval.
EXISTING LAW :
AB 1863
Page 2
1)Establishes the Medi-Cal program, administered by DHS, to
provide health services to qualified low-income, aged, blind
and disabled individuals.
2)Provides for the "medically needy" program, under which
low-income persons or families who are not categorically
eligible for Medi-Cal can obtain Medi-Cal benefits by paying a
share of cost.
3)Establishes "maintenance need income levels" for the purposes
of calculating an individual or family's share of cost.
FISCAL EFFECT : Unknown
COMMENTS :
1)NEED FOR THIS BILL . The author indicates that this bill is
necessary to provide relief for low-income elderly and
disabled individuals and families who must pay expensive
Medi-Cal deductibles before Medi-Cal will cover health care
expenses. For many, this financial burden discourages early
diagnosis and treatment, and compliance with prescription
medications and treatment therapies, which can result in more
expensive or catastrophic outcomes. Under the current system
an individual is expected to support him/herself on $600 a
month plus deductions. Any income received over that amount
is obligated as "share of cost" in any month services are
needed. According to the author, this $600 amount has not
been adjusted since 1989, not even for inflation. The author
asserts that complaints about "share of cost" are among the
biggest criticisms of the Medi-Cal program even though only
about 6% of the 5 million people qualified for Medi-Cal are
certified as "share of cost" eligibles. The author also
points out that seniors on Medicare who are also eligible for
Medi-Cal with a share of cost have access to prescription drug
coverage through Medi-Cal, but for expensive share of cost
barriers.
Protection and Advocacy and Western Center on Law and Poverty
(PAI/WCLP) co-sponsor this bill because it will provide fair
access to health care for persons with disabilities and
seniors whose income is too high to qualify for Supplemental
Security Income (SSI) because of their solid work history.
According to PAI/WCLP, any social security cost of living
AB 1863
Page 3
adjustment received by persons with disabilities and seniors
over the last 10 years went not to helping with increasing
living expenses but rather to increase the share of cost that
must be met before qualifying for Medi-Cal.
2)SUPPORT . This bill is supported by many organizations and
individuals concerned for low-income seniors, disabled and
families. The National Senior Citizens Law Center indicates
that people who fall into the "medically needy" category have
income available for basic living expenses after payment of
Medi-Cal share of cost that is considerably lower than persons
receiving public assistance benefits. For example, a couple
with $1250 per month income is left with only $954 to live on
after paying for medical expenses, whereas a couple with
income of $1248 per month because of SSI cash assistance,
retains all of their income and qualifies for free Medi-Cal.
The California Primary Care Association reports that their
clinic directors encounter patients every day who have
problems dealing with a large Medi-Cal share of cost, who are
really cash strapped and cannot make the required payment.
The California Seniors Coalition asserts that this bill is a
long-overdue reform.
3)GOVERNOR'S BUDGET PROPOSAL . The Governor's 2000-01 Budget
proposes to expand Medi-Cal coverage for the elderly, blind
and disabled in a manner that would eliminate share of cost
for individuals who have income up to the poverty level
(monthly income of $696). The proposal estimates
approximately 13,000 individuals who have a share of cost of
less than about $100 would qualify. The Legislative Analyst
indicates that the Governor's proposal provides limited
benefits to a relatively small group of individuals as the
proposal excludes couples and individuals with share of cost
over $100. The Legislative Analyst states that about 47,000
aged or disabled Medi-Cal beneficiaries have a share of cost
between $100 and $500. This bill would enhance the Governor's
proposal by including couples and expanding eligibility to
individuals with monthly income of about $900 and couples with
monthly income of about $1,350. This bill also reduces the
share of cost for those who would not qualify for free
Medi-Cal under the enhanced program by raising the maintenance
need income level to $660 for individuals and $1027 for
couples and adjusting this amount annually in an amount equal
to the consumer price index.
AB 1863
Page 4
4)RELATED LEGISLATION . AB 2125 (Gallegos) of 1998 and AB 497
(Gallegos) of 1999 were introduced to reduce share of cost
requirements for the medically needy. AB 2125 was stalled in
the Senate Appropriations Committee and AB 497 was amended in
the Assembly Appropriations Committee. AB 2500 (Ashburn),
also pending in the Assembly Health Committee, would establish
an income deduction in the Medi-Cal medically needy program of
150% of the United States Department of Health and Human
Services poverty guidelines.
REGISTERED SUPPORT / OPPOSITION :
Support
Protection and Advocacy, Inc (co-sponsor)
Western Center on Law and Poverty (co-sponsor)
American Federation of State, County and Municipal Employees
California Association of Public Hospitals
California Primary Care Association
California Seniors Coalition
Congress of California Seniors
Health Access California
National Senior Citizens Law Center
Older Women's League of California
Riverside County Board of Supervisors
Several Individuals
Opposition
None on file
Analysis Prepared by : Teri Boughton / HEALTH / (916) 319-2097