Bill Text: CA AB1878 | 2021-2022 | Regular Session | Introduced

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Bill Title: California Health Benefit Exchange: affordability assistance.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Engrossed - Dead) 2022-08-11 - In committee: Held under submission. [AB1878 Detail]

Download: California-2021-AB1878-Introduced.html

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CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill

No. 1878

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Introduced by Assembly Member Wood

February 08, 2022

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An act to amend Section 100520.5 of the Government Code, relating to the California Health Benefit Exchange.

LEGISLATIVE COUNSEL'S DIGEST

AB 1878, as introduced, Wood. California Health Benefit Exchange: affordability assistance.

Existing federal law, the Patient Protection and Affordable Care Act (PPACA), requires each state to establish an American Health Benefit Exchange to facilitate the purchase of qualified health benefit plans by qualified individuals and qualified small employers. Existing state law creates the California Health Benefit Exchange (Exchange), also known as Covered California, to facilitate the enrollment of qualified individuals and qualified small employers in qualified health plans as required under PPACA. Existing law requires the Exchange, in consultation with stakeholders and the Legislature, to develop options for providing cost-sharing reduction subsidies to reduce cost sharing for low- and middle-income Californians, and requires the Exchange to report the developed options on or before January 1, 2022. Existing law requires the options to include, among other things, options for all Covered California enrollees with income up to 400 percent of the federal poverty level to reduce cost sharing, including copays, deductibles, coinsurance, and maximum out-of-pocket costs.

This bill would require the Exchange to implement those options for providing health care affordability assistance. The bill would require the affordability assistance to reduce cost sharing, including copays, coinsurance, and maximum out-of-pocket costs, and to eliminate deductibles for all benefits. The bill would specify the actuarial value of cost-sharing assistance based on the income level of an enrollee, and would require the Exchange to adopt standard benefit designs consistent with these specifications.

Digest Key

Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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Bill Text

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

SECTION 1.

 Section 100520.5 of the Government Code is amended to read:

100520.5.

 (a) The Health Care Affordability Reserve Fund is hereby created in the State Treasury.

(b) Notwithstanding any other law, the Controller may use the funds in the Health Care Affordability Reserve Fund for cashflow loans to the General Fund as provided in Sections 16310 and 16381.

(c) Upon the enactment of the Budget Act of 2021, and upon order of the Director of Finance, the Controller shall transfer three hundred thirty-three million four hundred thirty-nine thousand dollars ($333,439,000) from the General Fund to the Health Care Affordability Reserve Fund.

(d) Upon appropriation by the Legislature, the Health Care Affordability Reserve Fund shall be utilized, in addition to any other appropriations made by the Legislature for the same purpose, for the purpose of health care affordability programs operated by the California Health Benefit Exchange.

(e)(1)The California Health Benefit Exchange shall, in consultation with stakeholders and the Legislature, develop options for providing cost sharing reduction subsidies to reduce cost sharing for low- and middle-income Californians. On or before January 1, 2022, the Exchange shall report those developed options to the Legislature, Governor, and the Healthy California for All Commission, established pursuant to Section 1001 of the Health and Safety Code, for consideration in the 2022–23 budget process.

(2)In developing the options, the Exchange shall do all of the following:

(A)Include options for all Covered California enrollees with income up to 400 percent of the federal poverty level to reduce cost sharing, including copays, deductibles, coinsurance, and maximum out-of-pocket costs.

(B)Include options to provide zero deductibles for all Covered California enrollees with income under 400 percent of the federal poverty level and upgrading those with income between 200 percent and 400 percent, inclusive, of the federal poverty level to gold-tier cost sharing.

(C)Address any operational issues that might impede implementation of enhanced cost-sharing reductions for the 2023 calendar year.

(D)Maximize federal funding and address interactions with federal law regarding federal cost-sharing reduction subsidies.

(3)The Exchange shall make the report publicly available on its internet website.

(4)The Exchange shall submit the report in compliance with Section 9795 of the Government Code.

(e) The California Health Benefit Exchange conducted, in consultation with stakeholders and the Legislature, a study to develop options for providing health care affordability assistance. It is the intent of the Legislature, in adding this subdivision, to enable the Exchange to implement that affordability assistance and to maximize federal financial assistance while providing affordability assistance in addition to that federal financial assistance.

(1) The affordability assistance provided by the Exchange shall reduce cost sharing, including copays, coinsurance, and maximum out-of-pocket costs, and shall eliminate deductibles for all benefits.

(2) The cost-sharing assistance provided to an enrollee with income under 200 percent of the federal poverty level shall not have an actuarial value of less than 94 percent.

(3) The cost-sharing assistance provided to an enrollee with income between 200 percent and 300 percent of the federal poverty level shall have an actuarial value of at least 90 percent and shall be scaled to income, with an enrollee at the lowest income receiving the most help.

(4) The cost-sharing assistance provided to an enrollee with income between 301 percent and 400 percent of the federal poverty level shall have an actuarial value of at least 85 percent and shall be scaled to income, with an enrollee at the lowest income receiving the most help.

(5) For an enrollee with income over 400 percent of the federal poverty level, actuarial assistance may have an actuarial value of as much as 80 percent, depending on available funding.

(6) The Exchange shall adopt standard benefit designs consistent with this subdivision.