Budget Subcommittees Review DHCS and DMHC budget items

Last week, the Legislature’s budget subcommittees on health and human services held hearings on the budgets for the Department of Health Care Services (DHCS) and the Department of Managed Health Care (DMHC).

Assembly Budget Subcommittee No. 1 (March 14, 2016)
The agenda, which includes details about each item heard, can be accessed here. Health Access supported proposals to make the following policy changes in Medi-Cal:

  • Increase the Medi-Cal Aged and Disabled Program income level to 138 percent of the Federal Poverty Level (FPL), creating a “brightline” of income eligibility and parity for elderly and disabled Medi-Cal beneficiaries with other adults. This is estimated to cost $30 million General Fund.
  • Limit Medi-Cal estate recovery to federal requirements, which only requires recovery for long-term services and supports. California goes beyond federal law by recovering for all health care costs, forcing low- income individuals age 55 and older to choose between signing up for basic healthcare services, and passing on their home and other limited assets they possess to their children. This is estimated to cost less than $57.9 million total funds ($28.94 million General Fund).
  • Restoration of “optional” benefits that were eliminated from the Medi-Cal program in 2009. They include full restoration of adult dental services, as well as acupuncture, audiology, optician/optical lab, podiatry, and speech therapy. All the restorations are estimated to cost $307.4 million ($115,910,000 General Fund).

The subcommittee held these items open, which means no action was taken at this time.

The budget subcommittee also rejected the Administration’s proposed trailer bill to begin moving children in the California Children’s Services program to managed care.

Senate Budget Subcommittee No. 3 (March 17, 2016)

The subcommittee heard issues relating to the DMHC and DHCS. The agenda can be found here.

Status of Timely Access Reports. SB 964 (Hernandez, 2014), requires health plans to submit data regarding its compliance with timely access requirements by plan networks. DMHC analyzes the data and is supposed to issue a report of its findings and recommendations with respect to health plan compliance with timely access appointment wait time standards. The report is overdue, and Senator Mitchell pressed the Department on the lateness of the report. DMHC said the delay is due to a large number of plans miscalculating their survey results. DMHC stated the report would be released in April.

DMHC Budget Change Proposals. Health Access supported Budget Change Proposals (BCPs) to obtain resources for implementing legislation we sponsored or supported. DMHC provided updates on its timeline and process for implementing these bills.

  • Limitations on Cost Sharing: Family Coverage (AB 1305): Health Access sponsored AB 1305, which ensures that no individual in a family would have more out-of-pocket medical costs than the individual limit of $6,600 set by federal law or the individual limit for that product, whichever is lower. This change will make cost sharing more reasonable and fair for families that have one or more family members facing serious illness.
  • Outpatient Prescription Drug Formularies (AB 339): Health Access sponsored AB 339, which protects Californians with chronic conditions like asthma, hepatitis, HIV/AIDS, multiple sclerosis, or other conditions for which require high-cost specialty medications. The law requires health plans and insurers to: cap cost sharing for prescription drugs at $250 or $500 per prescription; cover medically necessary prescription drugs; prohibits placement of most or all drugs to treat a specific condition on the highest cost tiers of a formulary; and requires formularies to be based on clinical guidelines and peer-reviewed scientific evidence as well as cost.
  • Provider Directories (SB 137): Health Access co-sponsored SB 137, which sets standards for provider directories and establish more oversight on accuracy so consumers know whether their doctor and hospital are in network when they shop for coverage, change coverage, or try to use their coverage to get care.
  • Large Group Rate Review (SB 546): Health Access supported SB 546, which establishes new rate review requirements for the large group market and encourages rate increases in the large group market to be more aligned with rates for large purchasers and active negotiators such as CalPERS and Covered California, and with the individual and small employer markets where rate review has already been implemented.
  • Federal Mental Health Parity Ongoing Compliance Review: Health Access supports providing DMHC with resources to contract with clinical consultants that provide the specialized medical, mental health, and substance use disorder knowledge that is not available through the civil service system but is necessary for reviewing critical aspects of MHPAEA (federal Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act) compliance, including the classification of benefits and NQTLs (non quantitative treatment limits).

The subcommittee held these items open, which means no action was taken at this time.

Both budget subcommittees will continue reviewing the Governor’s proposed budget, along with proposals from legislators and advocates.

Keep track of the proposed 2016-17 budget with our Budget Scorecard on issues affecting health care consumers.