Legislative Wrap Up: CA Continues To Lead In Implementing Health Reform

Monday, October 10, 2011


In the last week before the Governor’s deadline to sign or veto bills, Governor Brown signs key bills into law that help to implement health reform and other health bills.
* AB1296 (Bonilla) on Streamlining Eligibility and Enrollment
* AB922 (Monning), to Improve Consumer Assistance
* SB222 (Evans/Alquist) & AB210 (Hernandez) to Require Maternity Coverage
* SB51 (Alquist) to Implement the Medical Loss Ratio, Requiring Insurers to
Devote 80-85% of Premium Dollars on Patient Care, Not Administration or Profit
* SB202 (Hancock) on Ballot Measure Timing

Earlier in the session, Governor Brown also signed important health legislation including:
* AB151(Monning), Guaranteed Issue for MediGap Plans
* ABx1 21 & ABx1 30 (Blumenfield), to Extend “MCO Tax” to Fund Healthy Families

Not all bills will become law this year, the Governor vetoed:
* SB408(Hernandez), Hospital Change of Ownership Oversight

And other bills, like rate regulation (AB52), were held for further consideration next year.

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Yesterday, Governor Brown signed legislation to improve California’s health system and institute key consumer protections.

One measure, SB51 (Alquist), would allow state regulators to enforce new federal standards that ensure that at least 80%-85% of health insurance premiums go to medical care. Another bill, AB1296 (Bonilla), revamps eligibility and enrollment systems in public health programs, to better allow millions of Californians to get the coverage they need in 2014 and beyond.

Bills signed earlier in the week included key consumer protections for Californians, from requirement that maternity services are covered in all health plans, in AB210(R. Hernandez)/SB222(Evans/Alquist), to SB922(Monning), a reorganization and expansion of consumer assistance for California patients.

All these health bills get California ready for reform in different ways, implementing federal health care law and making improvements to prepare California for a health system of the future. Some measures, like the medical loss ratio, are just adopting the new federal standard at the state level. The maternity bills take an additional step in implementing the standard early, so Californians get the benefit sooner and the market has time to adjust. Others, like the revamp of eligibility and enrollment and of consumer assistance, are improvements that become urgent given the expansions of coverage in 2014.

These bills also build upon legislation implementing and improving the Affordable Care Act that was enacted last year, that set up the first-in-the-nation-after-health-reform Exchange, that instituted rate review of insurance rate hikes, that allowed children with pre-existing conditions to get affordable coverage, that allowed young adults to stay on their parents coverage, and that eliminated cost-sharing for preventative care.

With Governor Brown signing all the ACA-related bills this year, California continues to lead the nation in implementing health reform, but health advocates indicate there is much more to do to fulfill its promise by 2014.


* STREAMLINING ELIGIBILITY AND ENROLLMENT: AB1296 (Bonilla) requires the California Health and Human Services Agency establish a standardized single application form and related renewal procedures for Medi-Cal, the Healthy Families Program, the Exchange, and county programs. This sets a framework so that millions of Californians gain meaningful and easy access to coverage is expanded under the Affordable Care Act.

* IMPROVING CONSUMER ASSISTANCE: AB922 (Monning) improves the Office of Patient Advocate to provide better assistance to California health care consumers by providing a central, enhanced center to handle consumer questions and complaints, and for them to be triaged to the appropriate agencies, whether regulatory or administrative, state or federal, etc. The bill also transfers the Office of Patient Advocate, and the Department of Managed Health Care, to the Health and Human Services Agency.

* GUARANTEEING MATERNITY COVERAGE: SB222 (Evans/Alquist) & AB210 (Hernandez) requires that health plans sold in the individual and small group markets, respectively, stop discriminating against women and provide as a basic benefit, maternity care and maternity-related care, starting in July 2012. This will ensure Californians get needed care, and prevent them from falling onto taxpayer-funded programs, but also would allow for a smoother phase-in to the federal requirement that maternity be included in an essential benefits package in 2014.

* REQUIRING PREMIUM DOLLARS TO BE SPENT ON HEALTH CARE: SB51 (Alquist) allows state regulators to enforce the Medical Loss Ratio provision of the Affordable Care Act that requires insurers in the large group market to spend 85% of premium dollars on health care and insurers in the small group and individual markets to spend 80% of health care dollars on actually providing health care rather than for administration or profit.

* GUARANTEED ISSUE FOR SENIORS: AB151 (Monning) assures that those who previously covered by Medicare Advantage plans have guaranteed issue for Medi-Gap coverage.

Also Of Interest: Some bills of interest to health advocates included:

* ELECTIONS: SB202 (Hancock) will, as a policy going forward for ballot measures not yet scheduled, place initiatives on general election ballots in November, rather than primary elections where far fewer Californians vote. The measure also delays a vote on a “spending cap/rainy day fund” previously placed on the June 2012 ballot by the Legislature. Under the bill, the vote on “spending cap” constitutional amendment, opposed by Health Access California and other health advocates since it would force cuts in key programs, would be pushed back for two years to 2014, given the ongoing budget issues including the need to pay down debt rather than divert dollars to a “rainy day fund.”

* COVERAGE FOR KIDS: ABx1 21 and ABx1 30 (Blumenfield) are budget trailer bills that would maintain funding for children’s coverage by extending a Managed Care Organization (MCO) tax, which in turn will help bring down federal dollars to fund Healthy Families. These bills also prohibit, for one year, the immediate shift of the Healthy Families population into Medi-Cal.

Governor Brown did veto some health bills, including SB408(Hernandez), a bill supported by consumer and labor organizations to close a loophole in the oversight of hospital ownership transfers. Other health bills of note signed by Governor Brown this year included SB946(Steinberg), a requirement (until 2014) for insurers to cover certain types of autism treatment.

Next Year: Not all health reform-related measures this year advanced to the Governor’s Desk. Notably, high-profile rate regulation legislation, AB52 (Feuer), was held by the author because there was not enough support in the Senate at this time.

Other health reform implementation measures, sponsored by Health Access California–AB714 (Atkins) and AB792 (Bonilla) to easily enroll people into coverage starting in 2014, and AB1083 (Monning) to reform the small group market aligned with federal rules–were held as “two-year” bills will be considered next year, along with several other measures that will need to be passed next year, to be ready for 2014 implementation of the federal Affordable Care Act. On a parallel track and timeline, SB810(Leno), to create a single-payer universal health system, will also be considered next year as well. These bills will be part of a full agenda of health legislation next year.

For any questions or comments, contact the author of this report, Linda Leu, at lleu@health-access.org.

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