Bills, bills, bills…

Wednesday, April 16th, 2008

* Bill fails that would license and regulate “discount” health cards
* Panel passes bill to allow local county-run health plans to expand, compete
* Roundup of bills: children’s coverage, mandatory Medi-Cal managed care, benefits

Click Here for What’s New on the Health Access WeBlog: Health Wonk Review: Drug Co-Payments and Tier 4; Are the Uninsured the Cause of Overcrowded ERs?

The Senate Health Committee heard nearly two dozen bills on Wednesday in the final hearing before Friday’s policy committee deadline to get bills to a fiscal committee. Following is a roundup of the fate of some of the bills of interest to health and consumer advocates:


SB 1603 (Calderon) would have directed the state Department of Managed Health Care to license and regulate so-called discount health cards, which promise consumers deep (though often unverified) discounts on medical services from a network of providers (also often unverified). Consumers purchase a list of discount providers at a cost of up to $120/month. The state is in the process of promulgating regulations to address these plans, but current state law bans them, even though some currently operate in California.

With bipartisan opposition from committee members, the bill failed in committee. Consumer advocates have long argued that discount medical cards claim “discounts” off a non-public price, rendering the only true value of the card unknown and/or meaningless. Additionally, surveys have shown that medical providers contacted are not even aware that they are included on many discount cards’ list. Additionally, the plans often use misleading language to confuse consumers, and rely on the expectation that the consumer will not understand the difference between a discount health card and actual insurance coverage. Consumer advocates would need to see these issues resolved in order to support a regulation that would license these cards and give them the state’s seal of approval.


SB 1622 (Simitian) would facilitate a statewide public insurer, connecting existing county-based health care plans to be able to offer a broader regional network of providers. This would provide a more options for existing enrollees, especially those who live in one county and work in another, and also allow these local initiatives to better compete with private health care plans. Using economies of scale, this publicly owned health plan would compete with private health plans and provide an affordable alternative for uninsured and small businesses that feel squeezed by insurance costs. This concept was part of ABx1 1 (Nunez), the omnibus health reform legislation that failed in this committee earlier this year. The bill passed.


SB 1593 (Alquist) passed, which stipulates that children currently covered by county health initiatives would be the first in line to receive Medi-Cal and Healthy Families coverage once those programs are expanded to cover children up to 300% of poverty ($52,800 for a family of three). Currently, only citizen children up to 250% of poverty are covered by the state. Many counties now pick up the population between 250% and 300% of poverty. This measure complements two bills sponsored by the 100% Campaign – SB 32 (Steinberg) and AB 1 (Laird/Dymally) — that would expand state children’s coverage.

SB 1459 (Yee) passed, but with conditions for significant amendments, given the grilling by committee members, and their statements of concern and opposition about elements of the bill. The bill would consolidate both the Healthy Families and Medi-Cal programs under one name “Cal-Health’’ and sought to expand insurance for some children and some adults. Some advocates supported the stated intent to streamline enrollment and extend coverage, but many also raised concerns and/or opposition, with regard to the structure and specific provisions. These included issues about whether it included coverage all or just some children, the proposal’s relationship with current child expansion strategies, the interaction with already-passed streamlining efforts, and whether, as written, the proposal would privatize county eligibility workers, divert funding from public providers to private plans, and be a threat to public hospitals.

MANAGED CARE: Another bill that got significant discussion was SB 1332 (Negrete-McLeod), which sets up a a pilot that would mandate that seniors, and people with disabilities in San Bernardino and Riverside counties be required to enroll in Medi-Cal managed care plans. While it passed despite opposition from consumer, low-income, and labor advocates, the chair, Senator Kuehl, admonished the author to address their concerns, about the potential impact of the mandatory enrollment on these vulnerable populations, and the overall safety-net.

BENEFITS: A number of bills dealt with mandated benefits for consumers in insurance plans. Two bills that would guarantee additional benefits passed. One bill that took away benefits failed.

* SB 1198 (Kuehl) would require health plans to offer coverage for durable medical equipment, such as wheelchairs, bath seats and crutches, at the same levels applied to other benefits. Passed on a bipartisan vote.

* SB 1634 (Steinberg) would require the coverage orthodontic services for cleft palate. Passed on a bipartisan vote.

* SB 1669 (McClintock) would have allowed insurance companies to exclude coverage of conditions for which an individual policyholder has received medical advice, a diagnosis, treatment, of prescription drugs at any point in the previous 10 years. Failed with Republicans voting in support and Democrats voting in opposition.

OVERSIGHT: SB 1525 (Kuehl) would require the state to review how health plans decide what services are “medically necessary’’ and should be paid for, and which are not. Passed on a bipartisan vote.

Bills, votes, and analyses are available at the website of the California legislature, at:

A broader list of pending bills of interest to health and consumer advocates is updated and available at the Health Access website, at:

For more information on these or other bills, contact the author of this report, Hanh Kim Quach, at

Health Access California promotes quality, affordable health care for all Californians.

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