Bill Text: CA SB28 | 2013-2014 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: California Health Benefit Exchange.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Passed) 2013-10-01 - Chaptered by Secretary of State. Chapter 442, Statutes of 2013. [SB28 Detail]

Download: California-2013-SB28-Amended.html

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BILL NUMBER: SB 28	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 16, 2013

INTRODUCED BY   Senators Hernandez and Steinberg

                        DECEMBER 3, 2012

   An act to amend Section  12698.30 of the Insurance Code,
and to amend Sections 14005.31, 14005.32, 14132, and 15926 of, to
amend and repeal Sections 14008.85, 14011.16, and 14011.17 of, to
amend, repeal, and add Sections 14005.18, 14005.28, 14005.30,
14005.37, and 14012 of, to add Sections 14005.60, 14005.62, 14005.63,
14005.64, 14132.02, and 15926.2 to, the Welfare and Institutions
  100503 of the Government Code, to amend Section
12739.53 of, and to add Section 12712.5 to, the Insurance Code, and
to amend Section 14011.6 of the Welfare and Institutions  Code,
relating to health.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 28, as amended, Hernandez.  Medi-Cal: eligibility.
  California Health Benefit Exchange.  
   (1) Existing law establishes the California Major Risk Medical
Insurance Program (MRMIP), which is administered by the Managed Risk
Medical Insurance Board (MRMIB), to provide major risk medical
coverage to persons who, among other things, have been rejected for
coverage by at least one private health plan. Existing law requires
MRMIB to enter into an agreement with the federal Department of
Health and Human Services to administer a temporary high risk pool to
provide health coverage, until January 1, 2014, to specified
individuals who have preexisting conditions, consistent with the
federal Patient Protection and Affordable Care Act (PPACA). 

   Under PPACA, each state is required, by January 1, 2014, to
establish an American Health Benefit Exchange that makes available
qualified health plans to qualified individuals and small employers.
Existing state law establishes the California Health Benefit Exchange
(Exchange) within state government, specifies the powers and duties
of the board governing the Exchange, and requires the board to
facilitate the purchase of qualified health plans through the
Exchange by qualified individuals and small employers by January 1,
2014. Existing law also requires the board to undertake activities
necessary to market and publicize the availability of health care
coverage and federal subsidizes through the Exchange and to undertake
outreach and enrollment activities.  
   This bill would require MRMIB to provide the Exchange, or its
designee, with specified information of subscribers and applicants of
MRMIP and the temporary high risk pool in order to assist the
Exchange in conducting outreach to those subscribers and applicants.
 
   The bill would require the board governing the Exchange to provide
a specified notice informing those subscribers and applicants that
they may be eligible for reduced-cost coverage through the Exchange
or no-cost coverage through Medi-Cal.  
   Existing 
    (2)     Existing  law provides for the
Medi-Cal program, which is administered by the State Department of
Health Care Services, under which qualified low-income individuals
receive health care services. The Medi-Cal program is, in part,
governed and funded by federal Medicaid Program provisions. 
   Existing law requires, to the extent that federal financial
participation is available, that the department implement an option
provided for under the federal Social Security Act for a program for
accelerated enrollment of children into the Medi-Cal program.
Existing law requires the department to designate the single point of
entry, as defined, as the qualified entity for determining
eligibility under these provisions. 
   This bill would, commencing  January 1, 2014, implement
various provisions of the federal Patient Protection and Affordable
Care Act (Affordable Care Act), as amended, by, among other things,
modifying provisions relating to determining eligibility for certain
groups. The bill would, in this regard, extend Medi-Cal eligibility
to specified adults and would require that income eligibility be
determined based on modified adjusted gross income (MAGI), as
prescribed. The bill would prohibit the use of an asset or resources
test for individuals whose financial eligibility for Medi-Cal is
determined based on the application of MAGI. The bill would also add,
commencing January 1, 2014, benefits, services, and coverage
included in the essential health benefits package, as adopted by the
state and approved by the United States Secretary of Health and Human
Services, to the schedule of Medi-Cal benefits.  
October 1, 2013, require the department to designate the Exchange and
its agents, and specified county departments as qualified entities
for determining eligibility under the above-mentioned provisions. The
bill would also require the qualified entity to grant accelerated
enrollment if a complete eligibility determination cannot be made
based upon the receipt of an application for a child at the time of
the initial application. 
   Because  the bill would require  counties  are
required  to make  additional  Medi-Cal eligibility
 determinations and this bill would expand Medi-Cal
eligibility,   determinations,  the bill would
impose 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.
   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: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 100503 of the  
Government Code   is amended to read: 
   100503.  In addition to meeting the minimum requirements of
Section 1311 of the federal act, the board shall do all of the
following:
   (a) Determine the criteria and process for eligibility,
enrollment, and disenrollment of enrollees and potential enrollees in
the Exchange and coordinate that process with the state and local
government entities administering other health care coverage
programs, including the State Department of Health Care Services, the
Managed Risk Medical Insurance Board, and California counties, in
order to ensure consistent eligibility and enrollment processes and
seamless transitions between coverage.
   (b) Develop processes to coordinate with the county entities that
administer eligibility for the Medi-Cal program and the entity that
determines eligibility for the Healthy Families Program, including,
but not limited to, processes for case transfer, referral, and
enrollment in the Exchange of individuals applying for assistance to
those entities, if allowed or required by federal law.
   (c) Determine the minimum requirements a carrier must meet to be
considered for participation in the Exchange, and the standards and
criteria for selecting qualified health plans to be offered through
the Exchange that are in the best interests of qualified individuals
and qualified small employers. The board shall consistently and
uniformly apply these requirements, standards, and criteria to all
carriers. In the course of selectively contracting for health care
coverage offered to qualified individuals and qualified small
employers through the Exchange, the board shall seek to contract with
carriers so as to provide health care coverage choices that offer
the optimal combination of choice, value, quality, and service.
   (d) Provide, in each region of the state, a choice of qualified
health plans at each of the five levels of coverage contained in
subdivisions (d) and (e) of Section 1302 of the federal act.
   (e) Require, as a condition of participation in the Exchange,
carriers to fairly and affirmatively offer, market, and sell in the
Exchange at least one product within each of the five levels of
coverage contained in subdivisions (d) and (e) of Section 1302 of the
federal act. The board may require carriers to offer additional
products within each of those five levels of coverage. This
subdivision shall not apply to a carrier that solely offers
supplemental coverage in the Exchange under paragraph (10) of
subdivision (a) of Section 100504.
   (f) (1) Require, as a condition of participation in the Exchange,
carriers that sell any products outside the Exchange to do both of
the following:
   (A) Fairly and affirmatively offer, market, and sell all products
made available to individuals in the Exchange to individuals
purchasing coverage outside the Exchange.
   (B) Fairly and affirmatively offer, market, and sell all products
made available to small employers in the Exchange to small employers
purchasing coverage outside the Exchange.
   (2) For purposes of this subdivision, "product" does not include
contracts entered into pursuant to Part 6.2 (commencing with Section
12693) of Division 2 of the Insurance Code between the Managed Risk
Medical Insurance Board and carriers for enrolled Healthy Families
beneficiaries or contracts entered into pursuant to Chapter 7
(commencing with Section 14000) of, or Chapter 8 (commencing with
Section 14200) of, Part 3 of Division 9 of the Welfare and
Institutions Code between the State Department of Health Care
Services and carriers for enrolled Medi-Cal beneficiaries.
   (g) Determine when an enrollee's coverage commences and the extent
and scope of coverage.
   (h) Provide for the processing of applications and the enrollment
and disenrollment of enrollees.
   (i) Determine and approve cost-sharing provisions for qualified
health plans.
   (j) Establish uniform billing and payment policies for qualified
health plans offered in the Exchange to ensure consistent enrollment
and disenrollment activities for individuals enrolled in the
Exchange.
   (k)  (1)    Undertake activities necessary to
market and publicize the availability of health care coverage and
federal subsidies through the Exchange. The board shall also
undertake outreach and enrollment activities that seek to assist
enrollees and potential enrollees with enrolling and reenrolling in
the Exchange in the least burdensome manner, including populations
that may experience barriers to enrollment, such as the disabled and
those with limited English language proficiency. 
   (2) Use the information received pursuant to Section 12712.5 of,
and paragraph (10) of subdivision (b) of Section 12739.53 of, the
Insurance Code to provide an individual a notice that he or she may
be eligible for reduced-cost coverage through the Exchange or no-cost
coverage through Medi-Cal. The notice shall include information on
obtaining coverage pursuant to those programs. 
   (l) Select and set performance standards and compensation for
navigators selected under subdivision (l) of Section 100502.
   (m) Employ necessary staff.
   (1) The board shall hire a chief fiscal officer, a chief
operations officer, a director for the SHOP Exchange, a director of
Health Plan Contracting, a chief technology and information officer,
a general counsel, and other key executive positions, as determined
by the board, who shall be exempt from civil service.
   (2) (A) The board shall set the salaries for the exempt positions
described in paragraph (1) and subdivision (i) of Section 100500 in
amounts that are reasonably necessary to attract and retain
individuals of superior qualifications. The salaries shall be
published by the board in the board's annual budget. The board's
annual budget shall be posted on the Internet Web site of the
Exchange. To determine the compensation for these positions, the
board shall cause to be conducted, through the use of independent
outside advisors, salary surveys of both of the following:
   (i) Other state and federal health insurance exchanges that are
most comparable to the Exchange.
   (ii) Other relevant labor pools.
   (B) The salaries established by the board under subparagraph (A)
shall not exceed the highest comparable salary for a position of that
type, as determined by the surveys conducted pursuant to
subparagraph (A).
   (C) The Department of Human Resources shall review the methodology
used in the surveys conducted pursuant to subparagraph (A).
   (3) The positions described in paragraph (1) and subdivision (i)
of Section 100500 shall not be subject to otherwise applicable
provisions of the Government Code or the Public Contract Code and,
for those purposes, the Exchange shall not be considered a state
agency or public entity.
   (n) Assess a charge on the qualified health plans offered by
carriers that is reasonable and necessary to support the development,
operations, and prudent cash management of the Exchange. This charge
shall not affect the requirement under Section 1301 of the federal
act that carriers charge the same premium rate for each qualified
health plan whether offered inside or outside the Exchange.
   (o) Authorize expenditures, as necessary, from the California
Health Trust Fund to pay program expenses to administer the Exchange.

   (p) Keep an accurate accounting of all activities, receipts, and
expenditures, and annually submit to the United States Secretary of
Health and Human Services a report concerning that accounting.
Commencing January 1, 2016, the board shall conduct an annual audit.
   (q) (1) Annually prepare a written report on the implementation
and performance of the Exchange functions during the preceding fiscal
year, including, at a minimum, the manner in which funds were
expended and the progress toward, and the achievement of, the
requirements of this title. This report shall be transmitted to the
Legislature and the Governor and shall be made available to the
public on the Internet Web site of the Exchange. A report made to the
Legislature pursuant to this subdivision shall be submitted pursuant
to Section 9795.
   (2) In addition to the report described in paragraph (1), the
board shall be responsive to requests for additional information from
the Legislature, including providing testimony and commenting on
proposed state legislation or policy issues. The Legislature finds
and declares that activities including, but not limited to,
responding to legislative or executive inquiries, tracking and
commenting on legislation and regulatory activities, and preparing
reports on the implementation of this title and the performance of
the Exchange, are necessary state requirements and are distinct from
the promotion of legislative or regulatory modifications referred to
in subdivision (d) of Section 100520.
   (r) Maintain enrollment and expenditures to ensure that
expenditures do not exceed the amount of revenue in the fund, and if
sufficient revenue is not available to pay estimated expenditures,
institute appropriate measures to ensure fiscal solvency.
   (s) Exercise all powers reasonably necessary to carry out and
comply with the duties, responsibilities, and requirements of this
act and the federal act.
   (t) Consult with stakeholders relevant to carrying out the
activities under this title, including, but not limited to, all of
the following:
   (1) Health care consumers who are enrolled in health plans.
   (2) Individuals and entities with experience in facilitating
enrollment in health plans.
   (3) Representatives of small businesses and self-employed
individuals.
   (4) The State Medi-Cal Director.
   (5) Advocates for enrolling hard-to-reach populations.
   (u) Facilitate the purchase of qualified health plans in the
Exchange by qualified individuals and qualified small employers no
later than January 1, 2014.
   (v) Report, or contract with an independent entity to report, to
the Legislature by December 1, 2018, on whether to adopt the option
in paragraph (3) of subdivision (c) of Section 1312 of the federal
act to merge the individual and small employer markets. In its
report, the board shall provide information, based on at least two
years of data from the Exchange, on the potential impact on rates
paid by individuals and by small employers in a merged individual and
small employer market, as compared to the rates paid by individuals
and small employers if a separate individual and small employer
market is maintained. A report made pursuant to this subdivision
shall be submitted pursuant to Section 9795.
   (w) With respect to the SHOP Program, collect premiums and
administer all other necessary and related tasks, including, but not
limited to, enrollment and plan payment, in order to make the
offering of employee plan choice as simple as possible for qualified
small employers.
   (x) Require carriers participating in the Exchange to immediately
notify the Exchange, under the terms and conditions established by
the board when an individual is or will be enrolled in or disenrolled
from any qualified health plan offered by the carrier.
   (y) Ensure that the Exchange provides oral interpretation services
in any language for individuals seeking coverage through the
Exchange and makes available a toll-free telephone number for the
hearing and speech impaired. The board shall ensure that written
information made available by the Exchange is presented in a plainly
worded, easily understandable format and made available in prevalent
languages.
   SEC. 2.    Section 12712.5 is added to the  
Insurance Code   , to read:  
   12712.5.  In order to assist the California Health Benefit
Exchange, established under Title 22 (commencing with Section 100500)
of the Government Code, in conducting outreach to program
subscribers and applicants, the board shall provide the Exchange, or
its designee, with the names, addresses, email addresses, telephone
numbers, other contact information, and written and spoken languages
of program subscribers and applicants. 
   SEC. 3.    Section 12739.53 of the  
Insurance Code   is amended to read: 
   12739.53.  (a) The board shall, consistent with Section 1101 of
the federal Patient Protection and Affordable Care Act (P.L. 111-148)
and state and federal law and contingent on the agreement of the
federal Department of Health and Human Services and receipt of
sufficient federal funding, enter into an agreement with the federal
Department of Health and Human Services to administer the federal
temporary high risk pool in California.
   (b) If the federal Department of Health and Human Services and the
state enter into an agreement to administer the federal temporary
high risk pool, the board shall do all of the following:
   (1) Administer the program pursuant to that agreement.
   (2) Begin providing coverage in the program on the date
established pursuant to the agreement with the federal Department of
Health and Human Services.
   (3) Establish the scope and content of high risk medical coverage.

   (4) Determine reasonable minimum standards for participating
health plans, third-party administrators, and other contractors.
   (5) Determine the time, manner, method, and procedures for
withdrawing program approval from a plan, third-party administrator,
or other contractor, or limiting enrollment of subscribers in a plan.

   (6) Research and assess the needs of persons without adequate
health coverage and promote means of ensuring the availability of
adequate health care services.
   (7) Administer the program to ensure the following:
   (A) That the program subsidy amount does not exceed amounts
transferred to the fund pursuant to this part.
   (B) That the aggregate amount spent for high risk medical coverage
and program administration does not exceed the federal funds
available to the state for this purpose and that no state funds are
spent for the purposes of this part.
   (8) Maintain enrollment and expenditures to ensure that
expenditures do not exceed amounts available in the fund and that no
state funds are spent for purposes of this part. If sufficient funds
are not available to cover the estimated cost of program
expenditures, the board shall institute appropriate measures to limit
enrollment.
   (9) In adopting benefit and eligibility standards, be guided by
the needs and welfare of persons unable to secure adequate health
coverage for themselves and their dependents and by prevailing
practices among private health plans.
   (10)  (A)    As required by the federal
Department of Health and Human Services, implement procedures to
provide for the transition of subscribers into qualified health plans
offered through  an exchange or exchanges to be 
 the California Health Benefit Exchange  established
pursuant to  the federal Patient Protection and Affordable
Care Act (P.L. 111-148)   Title 22 (commencing with
Section 100500) of the Government Code  . 
   (B) In order to assist the Exchange in conducting outreach to
program subscribers and applicants, provide the Exchange, or its
designee, with the names, addresses, email addresses, telephone
numbers, other contact information, and written and spoken languages
of program subscribers and applicants. 
   (11) Post on the board's Internet Web site the monthly progress
reports submitted to the federal Department of Health and Human
Services. In addition, the board shall provide notice of any
anticipated waiting lists or disenrollments due to insufficient
funding to the public, by making that notice available as part of its
board meetings, and concurrently to the Legislature.
   (12) Develop and implement a plan for marketing and outreach.
   (c) There shall not be any liability in a private capacity on the
part of the board or any member of the board, or any officer or
employee of the board for or on account of any act performed or
obligation entered into in an official capacity, when done in good
faith, without intent to defraud, and in connection with the
administration, management, or conduct of this part or affairs
related to this part.
   SEC. 4.    Section 14011.6 of the   Welfare
and Institutions Code   is amended to read: 
   14011.6.  (a) To the extent federal financial participation is
available, the department shall exercise the option provided in
Section 1920a of the federal Social Security Act (42 U.S.C. Sec.
1396r-1a) to implement a program for accelerated enrollment of
children.
   (b) The department shall designate the single point of entry, as
defined in subdivision (c), as the qualified entity for determining
eligibility under this section.
   (c) For purposes of this section, "single point of entry" means
the centralized processing entity that accepts and screens
applications for benefits under the Medi-Cal  Program
  program  for the purpose of forwarding them to
the appropriate counties. 
   (d) Commencing October 1, 2013, the department shall designate the
California Health Benefit Exchange, established under Title 22
(commencing with Section 100500) of the Government Code, and its
agents and county human services departments as qualified entities
for determining eligibility for accelerated enrollment under this
section.  
   (d) 
    (e)  The department shall implement this section only
if, and to the extent that, federal financial participation is
available. 
   (e) 
    (f)  The department shall seek federal approval of any
state plan amendments necessary to implement this section. When
federal approval of the state plan amendment or amendments is
received, the department shall commence implementation of this
section on the first day of the second month following the month in
which federal approval of the state plan amendment or amendments is
received, or on July 1, 2002, whichever is later. 
   (f) 
   (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, without taking any regulatory action, implement
this section by means of all-county letters. 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. 
   (g) 
    (h)  Upon the receipt of an application for a child who
has coverage pursuant to the accelerated enrollment program, a county
shall determine whether the child is eligible for Medi-Cal benefits.
If the county determines that the child does not meet the
eligibility requirements for participation in the Medi-Cal program,
the county shall report this finding to the Medical Eligibility Data
System so that accelerated enrollment coverage benefits are
discontinued. The information to be reported shall consist of the
minimum data elements necessary to discontinue that coverage for the
child. This subdivision shall become operative on July 1, 2002, or
the date that the program for accelerated enrollment coverage for
children takes effect, whichever is later. 
   (i) If a complete eligibility determination cannot be made based
upon the receipt of an application for a child at the time of the
initial application, the qualified entity shall grant accelerated
enrollment pursuant to this section. 
   SEC. 5.    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.  All matter
omitted in this version of the bill appears in the bill as introduced
in the Senate, December 3, 2012. (JR11)