Senate Health Committee Moves Key Bills Forward

At the beginning of the Senate Health Committee this afternoon, Senator Hernandez focused on a handful of bills on benefit mandates. Saying they were awaiting federal guidance about the essential minimum benefits as part of the federal health law, he announced a decision on the part of the committee to hear but not vote on health insurance benefit mandate bills, holding them as two-year bills. He stated that the action was not to be seen as opposition, but it was the intent of the committee and the leadership to wait for federal guidance about minimum essential benefits before taking any action, regardless of their house of origin. For this month, that only holding two bills, one by Senator Steinberg and another by Senator Pavley, for which they took extensive testimony. (Another measure, by Senator Simitian, was amended to remove the mandate portion of a large measure.) That said, Chair Hernandez stated that the committee did intend to move forward with benefit mandate bills related to benefits that were explicitly mentioned in the federal law–such as maternity coverage, as addressed in SB155.

SB155 by Senator Noreen Evans would require maternity care in health plans, something that will be required in health plans under the federal law in 2014. Senator Evans said that it was becoming more and more difficult for women to find health plans that cover maternity care in the individual market, citing a sharp downward trend in the plans that offer these services, which have dropped from 82% in 2004 to 19% last year and 12% this year. Witnesses testified about the importance of early maternity services early in pregnancy and the impact that prenatal care can have on child health and delivery outcomes. Other witnesses pointed out that plans that provide necessary medical care for men, but not for women were discriminatory, and plans that charge women more to provide them with necessary health care were discriminatory as well.

SB51 by Senator Elaine Alquist also relates to the implementation of the Affordable Care Act, specifically, it puts into California law the federal “Medical Loss Ratio” requirements. Because insurance companies think of money that they have to spend on actually providing health care to their customers, they use the term “medical loss” to refer to those dollars. The ACA requires that insurers spend 80% of premium dollars on health care in the small group and individual market plans, and 85% of premium dollars on providing care in the large group market, it further requires that insurers that do not meet Medical Loss Ratios provide annual refunds to customers.

SB677 (Hernandez) is the Chair’s bill to implement the changes in Medi-Cal eligibility rules. The current eligibility rules are notoriously complicated, and this bill will simplify them by eliminating the assets test and using instead the Modified Adjusted Gross Income (MAGI) test currently used for tax purposes. The old assets test was both ineffective in keeping ineligible individuals off public programs (poor people don’t have assets), and an unnecessary barrier to breaking the cycles of poverty by prohibiting low-income families from saving. Conforming to the federal law and simplifying eligibility and enrollment will no doubt be key to ensuring that as many as possible of the state’s 7 million uninsured residents get covered and that the state can take full advantage of federal funds as they become available.

Last but certainly not least, the committee heard SB222 by Senator Alquist. This is the reincarnation of SB52 from last year, also carried by Senator Alquist. The bill would allow local health plan initiatives and county organized health systems to form joint ventures. These entities could form joint ventures to broaden their networks so that their local coverage programs could become regional public health insurance options.

All of these bills passed out of Senate Health Committee and will next face scrutiny from the Senate Appropriations Committee and then hopefully, move to the Senate floor.

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

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