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SB-1414 Health care coverage.(2001-2002)

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SB1414:v96#DOCUMENT

Amended  IN  Senate  March 18, 2002
Amended  IN  Senate  April 16, 2002
Amended  IN  Senate  May 13, 2002

CALIFORNIA LEGISLATURE— 2001–2002 REGULAR SESSION

Senate Bill
No. 1414


Introduced  by  Senator Speier
(Principal Coauthor(s): Assembly Member Goldberg)

February 14, 2002


An act to add Division 100 (commencing with Section 100000) to the Health and Safety Code, and to amend Section 14005.30 of, and to add Section 14005.41 Health and Safety Code, to add Section 12693.705 to the Insurance Code, and to amend Sections 14005.30 and 14011 of, and to add Sections 14005.41 and 14005.42 to, the Welfare and Institutions Code, relating to health care coverage.


LEGISLATIVE COUNSEL'S DIGEST


SB 1414, as amended, Speier. Health care coverage.
Existing law provides health care coverage to various segments of the population under the Healthy Families Program and the Access for Infants and Mothers Program, including low-income families and individuals unable to obtain coverage through his or her employer or under the Medi-Cal program.
This bill would integrate the Medi-Cal children and families program, the Healthy Families Program, and the Access for Infants and Mothers Program to establish the Healthy California Program for the purpose of providing health care and health coverage to all citizens and legal immigrants without access to affordable, employer-based coverage. The bill would require the Managed Risk Medical Insurance Board to administer the program. The bill would authorize the board to contract with health care service plans, disability insurers, and managed care organizations to provide health coverage for the program. The bill would require the board and the department to apply for appropriate federal waivers to enable the state to obtain matching federal funds for the program. The bill would provide that the program would not be implemented unless federal funding is obtained.
Existing law establishes the Healthy Families Program, administered by the Managed Risk Medical Insurance Board, to arrange for the provision of health, dental, and vision services to eligible children pursuant to a federal program, entitled the State Children’s Health Insurance Program. Under existing law, in order to be eligible, an applicant must be applying on behalf of a child who meets certain requirements, including being in a family having a gross annual household income equal to or less than 200% of the federal poverty level, and meeting citizenship and immigration status requirements established by federal law.
This bill would require the board to require applicants for, and recipients of, benefits under the Healthy Families Program, to provide independent documentation that they meet the qualifications for eligibility only to the extent required by federal law, except as specified. The bill would require these applicants and recipients to file an affirmation, signed under penalty of perjury, providing specified income information in connection with the board’s eligibility determination. By expanding the scope of the crime of perjury, the bill would impose a state-mandated local program.
Existing law provides for the Medi-Cal program administered by the State Department of Health Services under which qualified low-income persons are provided with health care services. Existing law requires the department, to the extent that federal financial participation is available, to adopt an income disregard for applicants equal to the difference between the income standard and the amount equal to 100% of the federal poverty level applicable to the size of the family. Existing law provides that a recipient shall be entitled to the same income disregard to the extent that it is more beneficial than, and is substituted for, the earned income disregard available to recipients.
This bill would, to the extent that federal financial participation and funding in the budget are available, require the department, upon receipt of the federal waiver, to disregard all income and assets for specified applicants and recipients.
This bill would require employers to pay a Healthy California premium payroll tax as a percentage of each employee’s wages, as determined by the board, or authorize them to instead provide health benefits if certain requirements are met. The bill would provide that the tax would be progressive with tax rates.
By imposing a new tax, the bill would result in a change in state taxes for the purpose of increasing revenues within the meaning of Section 3 of Article XIII A of the California Constitution, and thus would require for passage the approval of 2/3 of the membership of each house of the Legislature.
Existing law requires applicants for benefits under the Medi-Cal program who are not recipients of aid under other specified public assistance programs to file an affirmation providing certain income information in connection with the department’s eligibility determination.
This bill would require the above affirmation to be signed under penalty of perjury. By expanding the scope of the crime of perjury, the bill would impose a state-mandated local program. The bill would also require applicants and recipients to provide independent documentation that they meet the qualifications for eligibility only to the extent required by federal law, except as specified.
Under existing law, counties are responsible for the implementation of eligibility determinations under the Medi-Cal program.
By extending the eligibility for benefits under the Medi-Cal program and modifying the eligibility determination process, this bill would increase the responsibilities of the counties in the administration of the Medi-Cal program and would result in a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement, including the creation of a State Mandates Claims Fund to pay the costs of mandates that do not exceed $1,000,000 statewide and other procedures for claims whose statewide costs exceed $1,000,000.
This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions.
Vote: 2/3   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 The Legislature finds and declares the following:
(a) Governor Gray Davis signed Senate Bill 480, Solis (Chapter 990, Statutes of 1999), which required the Secretary of the California Health and Human Services Agency to report back to the Legislature on the options for achieving universal health care coverage and on the state of health coverage in California.
(b) The Secretary of the California Health and Human Services Agency established the Health Care Options Project which solicited proposals for expanding health care coverage in California and selected nine authors to develop their ideas for health care reform.
(c) The Secretary of the California Health and Human Services Agency contracted with an independent agency to do a fiscal analysis of the nine proposals.
(d) One of the nine proposals was the Healthy California Program which proposes to cover all citizens and legal immigrants residing in California.
(e) The Healthy California Program proposes to first maximize existing federal matching funds in stage 1 to all noncustodial adults up to 150 percent of the federal poverty level.
(f) The Healthy California Program proposes in stage 2 to capture additional federal funds and institute a pay-or-play approach that avoids the barrier that the Employee Retirement Income Security Act poses to state reforms that try to require employers to help pay for coverage.
(g) The pay-or-play approach will require employers to choose whether to play by providing private coverage or pay a premium as a percentage of payroll to the state program.
(h) This act will guarantee that all eligible persons will have the choice between participating in their employer’s plan if one is offered, or enrolling in Healthy California Program coverage through the program.
(i) The Healthy California Program will not cover all residents of California and it is not the intent of the Legislature to eliminate the funding for safety net programs.

SEC. 2.

 Division 100 (commencing with Section 100000) is added to the Health and Safety Code, to read:

DIVISION 100. THE HEALTHY CALIFORNIA PROGRAM

CHAPTER  1. General Provisions

100000.
 The Healthy California Program is hereby created.

100001.
 For purposes of this division, the definitions contained in this section have the following meanings:
(a) “Program” means the Healthy California Program that provides health coverage to all citizens and legal immigrants residing in this state without access to affordable employer-based coverage.
(b) “Applicant” means a person who applies for coverage under the program.
(c) “Board” means the Managed Risk Medical Insurance Board.
(d) “Department” means the State Department of Health Services.
(e) “Enrollee” means an applicant who qualified and was accepted into the program.
(f) “Fund” means the Healthy California Fund.

CHAPTER  2. Duties and Responsibilities

100002.
 The program shall be administered by the board. The board shall conduct outreach programs to locate potentially eligible persons, determine eligibility of applicants, and monitor and ensure the quality of the program, including assuring that culturally competent services are available to applicants and enrollees.

100003.
 The board may contract directly with health care providers, including health care service plans, disability insurers, and managed care organizations to provide health coverage for the program.

100004.
 (a) The board shall adopt regulations to establish a standard benefits package for all enrollees that will be similar to those benefits offered by the Healthy Families Program.

(b)All citizens and legal immigrants shall be eligible to receive

(b) Upon the implementation of stage 2, all citizens and legal immigrants not covered by Medicare or CHAMPUS shall be eligible to receive these benefits. For purposes of this section, “legal immigrants” shall be defined consistent with the eligibility requirements and definitions employed by the Medi-Cal program under Section 14007.5 of the Welfare and Institutions Code.
(c) (1) An enrollee who would qualify for Medi-Cal pursuant to Chapter 7 (commencing with Section 14000) of Part 3 of Division 6 of the Welfare and Institutions Code shall receive expanded benefits and shall not be charged copays or deductibles that exceed those charged by the Medi-Cal no-share-of-cost program.
(2) The board shall adopt regulations necessary to define and implement these expanded benefits.

100005.
 The board and the department shall apply for appropriate federal waivers, as determined by the board, that will enable the state to obtain matching federal funds to help pay for the coverage of all persons who would otherwise qualify for the Medi-Cal and Healthy Families Programs.

100006.
 (a) The program shall be implemented in two stages and in the first stage of the program, the board and the department shall do the following:
(1) Maximize federal matching funds for the Medi-Cal program to provide coverage to noncustodial adults up to 150 percent of the federal poverty level.
(2) Integrate the Medi-Cal children and families programs, the Healthy Families Program, and the Access for Infants and Mothers Program into a new program called the Healthy California Program. The Healthy California Program shall use one simplified application and shall continue the same eligibility levels used currently in the Medi-Cal children and families programs, the Healthy Families Program, and the Access for Infants and Mothers Program, with the board and the department maximizing the federal funds available in the federal medicaid and State Children’s Health Insurance Programs.
(b) In the second stage of the program, the board shall do the following:
(1)  Work with the department to make all families eligible for federal matching funds regardless of income or assets.
(2) Receive payroll premium tax payments from employers and employees for all employees not covered through employers.
(3) Reduce administrative costs.

100007.
 (a) There is hereby created in the State Treasury the Healthy California Fund which is, notwithstanding Section 13340 of the Government Code, continuously appropriated to the board for the purposes specified in this division.
(b) The board shall authorize the expenditure from the fund of any state funds or federal funds deposited into the fund. The board may authorize the State Department of Health Services to transfer funds appropriated to the department for the program to the Healthy California Fund and to also deposit those funds in, and to disburse those funds from, the Healthy California Fund.
(c) Notwithstanding any other provision of law, this division shall be implemented only if, and to the extent that, as provided under Title XXI of the Social Security Act, federal financial participation is available and state plan approval is obtained.

100008.
 (a) Notwithstanding any other provision of law, employers in the State of California shall pay a Healthy California premium payroll tax as a percentage of each employee’s wages, as determined by the board. Employers may choose instead to provide health benefits and shall receive a credit for the full amount of the tax if the actuarial value of the health benefits provided is equivalent to the value of the standard benefits package and if the employee accepts the benefits offered.
(b) The Healthy California premium payroll tax shall be progressive with tax rates and shall increase with increasing levels of income. The rates shall be reduced for small employers with low-wage workers.
(c) This section shall become operative upon completion of stage 1.

Section 12693.705 is added to the Insurance Code, to read:

12693.705.
 (a) Subject to subdivisions (b) and (c), the board shall require applicants and recipients to provide independent documentation that they meet the qualifications for eligibility only to the extent required by federal law.
(b) The board shall require every applicant for, and recipient of, benefits under this part to file an affirmation, signed under penalty of perjury, setting forth any facts about his or her annual income, applicable income deductions, and other qualifications for eligibility as may be required by the board. The statements shall be on forms prescribed by the board.
(c) Nothing in this section shall affect the board’s authority to verify eligibility through the Income Eligibility Verification System match under Section 1137 of the federal Social Security Act (42 U.S.C. Section 1320b-7), or to conduct paperless posteligibility random sampling.

Section 14005.30 of the Welfare and Institutions Code is amended to read:

14005.30.
 (a) (1) To the extent that federal financial participation is available, Medi-Cal benefits under this chapter shall be provided to individuals eligible for services under Section 1396u-1 of Title 42 of the United States Code, including any options under Section 1396u-1(b)(2)(C) made available to and exercised by the state.
(2) The department shall exercise its option under Section 1396u-1(b)(2)(C) of Title 42 of the United States Code to adopt less restrictive income and resource eligibility standards and methodologies to the extent necessary to allow all recipients of benefits under Chapter 2 (commencing with Section 11200) to be eligible for Medi-Cal under paragraph (1).
(3) To the extent federal financial participation is available, the department shall exercise its option under Section 1396u-1(b)(2)(C) of Title 42 of the United States Code authorizing the state to disregard all changes in income or assets of a beneficiary until the next annual redetermination under Section 14012. The department shall implement this paragraph only if, and to the extent that, the State Child Health Insurance Program waiver described in Section 12693.755 of the Insurance Code extending Healthy Families Program eligibility to parents and certain other adults is approved and implemented.
(b) To the extent that federal financial participation is available, the department shall exercise its option under Section 1396u-1(b)(2)(C) of Title 42 of the United States Code as necessary to expand simplify eligibility for Medi-Cal under subdivision (a) by establishing the amount of countable resources individuals or families are allowed to retain at the same amount medically needy individuals and families are allowed to retain, except that a family of one shall be allowed to retain countable resources in the amount of three thousand dollars ($3,000). by exempting all resources.
(c) To the extent federal financial participation is available, the department shall, commencing March 1, 2000, adopt an income disregard for applicants equal to the difference between the income standard under the program adopted pursuant to Section 1931(b) of the federal Social Security Act (42 U.S.C. Sec. 1396u-1) and the amount equal to 100 percent of the federal poverty level applicable to the size of the family. A recipient shall be entitled to the same disregard, but only to the extent that it is more beneficial than, and is substituted for, the earned income disregard available to recipients.
(d) To the extent federal financial participation is available and funding is available in the budget, the department shall, upon receipt of the federal waiver under Section 1115 of the Social Security Act, as specified in Section 14005.41 of the Welfare and Institutions Code, disregard all income and assets for applicants and recipients under the program adopted pursuant to Section 1931(b) of the federal Social Security Act (42 U.S.C. Sec. 1396u-1).
(e) For purposes of calculating income under this section during any calendar year, increases in social security benefit payments under Title II of the federal Social Security Act (42 U.S.C. Sec. 401 and following) arising from cost-of-living adjustments shall be disregarded commencing in the month that these social security benefit payments are increased by the cost-of-living adjustment through the month before the month in which a change in the federal poverty level requires the department to modify the income disregard pursuant to subdivision (c) and in which new income limits for the program established by this section are adopted by the department.
(f) Subdivision (b) shall be applied retroactively to January 1, 1998.
(g) Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department shall implement, without taking regulatory action, subdivisions (a) and (b) of this section by means of an all county letter or similar instruction. Thereafter, the department shall adopt regulations in accordance with the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. Beginning six months after the effective date of this section, the department shall provide a status report to the Legislature on a semiannual basis until regulations have been adopted.

SEC. 4.

Section 14005.41 is added to the Welfare and Institutions Code, to read:

14005.41.
 (a) Notwithstanding any other provision of law, any California resident who is an independent adult and whose income is at or below 150 percent of the federal poverty level shall receive health care benefits and services specified in this chapter, to the same extent that they are available to a recipient eligible pursuant to Section 1931(b) of the Social Security Act (42 U.S.C. Sec. 1396u-1).
(b) For purposes of this section, an “independent adult” is a person who is over 18 years of age, under 65 years of age, not pregnant, neither a parent or a caretaker relative, and neither blind nor disabled as defined for purposes of the Supplemental Security Income/State Supplementary Program for the Aged, Blind and Disabled (SSI/SSP) program.
(c) For purposes of this section, countable income shall be determined by applying the same income and resource disregards and exemptions that are provided to applicants for health care benefits and services specified in this chapter pursuant to Section 1931(b) of the Social Security Act (42 U.S.C. Sec. 1396u-1).
(d) The department shall maximize the federal reimbursement received for services provided under this chapter to independent adults, including, without limitation, through seeking appropriate waivers under Section 1115 of the Social Security Act (42 U.S.C. Sec. 1315).
(e) Implementation of the section shall be conditional on funds being available in the budget.

SEC. 5.

SEC. 6.

 Section 14005.42 is added to the Welfare and Institutions Code, to read:

14005.42.
 (a) The department shall exercise all options available under federal law to simplify eligibility for Medi-Cal benefits by exempting all resources of the following individuals in the determination of eligibility for benefits under the Medi-Cal program:
(1) Persons receiving benefits under the Medi-Cal program pursuant to Section 14005.30.
(2) Medically needy family persons receiving benefits under the Medi-Cal program pursuant to Section 14005.7, if their countable income does not exceed 200 percent of the federal poverty level applicable to the size of the family.
(b) The department shall seek a federal waiver for any group described in subdivision (a) for which an option is not available to apply the procedures required by subdivision (a).

Section 14011 of the Welfare and Institutions Code is amended to read:

14011.
 (a) Each applicant who is not a recipient of aid under the provisions of Chapter 2 (commencing with Section 11200) or Chapter 3 (commencing with Section 12000) shall be required to file an affirmation, signed under penalty of perjury, setting forth such any facts about his or her annual income and other resources and qualifications for eligibility as may be required by the department. Such The statements shall be on forms prescribed by the department.
(b) To the extent permitted by federal law, eligibility for medical assistance for such applicants shall not be granted until the applicant or designated representative provides independent documentation verifying statements of gross income by type and source; income amounts withheld for taxes, health care benefits available through employment, retirement, military service, work related injuries or settlements from prior injuries, employee retirement contributions, and other employee benefit contributions, deductible expenses for maintenance or improvement of income-producing property and status and value of property owned, other than property exempt under Section 14006. The director may prescribe those items of exempt property which the director deems should be verified as to status and value in order to reasonably assure a correct designation of those items as exempt. Subject to subdivisions (g), (h), and (i), the department shall require applicants and recipients to provide independent documentation that they meet the qualifications for eligibility only to the extent required by federal law.
(c) The verification requirements of subdivision (b) apply to income, income deductions, and property both of applicants for medical assistance (other than applicants for public assistance) and to persons whose income, income deductions, expenses or property holdings must shall be considered in determining the applicant’s eligibility and share of cost.
(d) A determination of eligibility and share of cost may be extended beyond otherwise prescribed time frames if, in the county department’s judgment, and subject to standards of the director, the applicant or designated representative has good cause for failure to provide the required verification and continues to make a good faith effort to provide such the verification.
(e) To the extent permitted by federal law, in addition to the other verification requirements of this section, a county department may require verification of any other applicant statements, or conduct a full and complete investigation of the statements, whenever a verification or investigation is warranted in the judgment of the county department.
(f) If documentation is unavailable, as defined in regulations promulgated by the department, the applicant’s signed statement as to the value or amount shall be deemed to constitute verification.
(g) Nothing in this section shall affect the department’s authority to verify eligibility through the Income Eligibility Verification System match mandated by Section 1137 of the federal Social Security Act (42 U.S.C. Sec. 1320b-7), to conduct a paperless posteligibility random sampling, or to develop a Medicaid eligibility quality control pilot program to conduct focused paperless reviews to evaluate the impact of eliminating or reducing documentation and verification requirements on proper eligibility determinations.
(h) The department shall target the use of the data produced by the Income Eligibility Verification System in ways that are most cost-effective and beneficial, as provided in Section 435.953 of Title 42 of the Code of Federal Regulations.
(i) By March 31, 2003, the department shall develop and submit for approval by the Secretary of the United States Department of Health and Human Services a plan listing categories of information items to be excluded from followup per Section 15804.4 of the State Medicaid Manual. This plan shall be developed in consultation with school districts, consumer advocates, representatives from county welfare departments, and other stakeholders.

SEC. 8.

 Notwithstanding Section 17610 of the Government Code, if the Commission on State Mandates determines that this act contains costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code. If the statewide cost of the claim for reimbursement does not exceed one million dollars ($1,000,000), reimbursement shall be made from the State Mandates Claims Fund.