BILL ANALYSIS
SENATE HEALTH
COMMITTEE ANALYSIS
Senator Sheila J. Kuehl, Chair
BILL NO: AB 1113
A
AUTHOR: Brownley
B
AMENDED: April 24, 2007
HEARING DATE: July 11, 2007
1
FISCAL: Appropriations
1
CONSULTANT:
1
Dunstan/sh
3
SUBJECT
Medi-Cal eligibility: California Working Disabled Program
SUMMARY
Eliminates the sunset date for the Medi-Cal program for the
California Working Disabled Program (CWD program) and makes
specified changes in the eligibility criteria.
CHANGES TO EXISTING LAW
Existing law:
Existing law establishes the Medi-Cal program, administered
by the Department of Health Care Services (DHCS), which
provides comprehensive health care coverage for low-income
individuals and their families; pregnant women; elderly,
blind, or disabled persons; nursing home residents; and
refugees who meet specified eligibility criteria. Existing
law also establishes the federal/state Supplemental
Security Income/State Supplemental Payment program
(SSI/SSP) which provides cash assistance to eligible aged,
Continued---
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blind, and disabled individuals and couples. SSI is a
federal program and the state supplements the grants
through the SSP program.
Existing law establishes the CWD program within Medi-Cal
for working disabled individuals with net countable family
income of up to 250 percent of the federal poverty level
(FPL). Existing law exempts from income used to determine
eligibility all disability income and specific categories
of retirement income. In addition, eligibility for the
program is subject to federal limits on assets, including
that the assets and income of a spouse must be considered
in determining eligibility. Existing law also requires
that Medi-Cal benefits offered under the CWD program shall
be identical to those received by persons eligible under
the Medi-Cal categorically needy eligibility category.
Existing law also requires that beneficiaries in the CWD
program pay monthly premiums that vary from $20-$250 for
individuals and $30-$375 for couples, depending on income.
Existing law requires that the spouse's income be
considered in determining the premium. Existing law also
eliminates the CWD program on September 1, 2008.
This bill:
This bill would make various changes in determining
eligibility for the CWD program, only to the extent that
the changes are consistent with applicable federal law.
This bill would disregard the spouse's income when
determining eligibility or the monthly premium for the CWD.
This bill would also exempt resources that are above the
program limits, but were accumulated while the individual
was working and qualified for Medi-Cal through the CWD
program, and also would exempt the resources of the spouse.
This bill would additionally exempt all sources of
retirement income received by individuals 65 years of age
or older, provided they entered the program before reaching
the age of 65. The bill would also allow individuals
eligible for the CWD program, but who are temporarily not
working, to remain on Medi-Cal for up to 18 months,
provided the individual continues to pay the CWD program
premiums.
This bill eliminates the existing sunset date and makes
other technical changes. This bill contains a legislative
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finding that the state's experience with enrollment in the
CWD program has not met expectations.
FISCAL IMPACT
According to the Assembly Appropriations Committee, AB 1113
would result in annual costs between $1 million and $2
million (50 percent general fund) to make the current CWD
program permanent. This estimate accounts for the fact
that many enrollees shift to the CWD program from other
Medi-Cal programs, reducing the net fiscal impact. AB 1113
would also result in annual increased costs to the extent
that eligibility changes regarding income and asset
disregards increase CWD enrollment. A 20 percent increase
in enrollment would increase Medi-Cal costs up to $1.4
million (50 percent general fund). Again, the actual net
fiscal impact may be lower depending on how many enrollees
transfer from other Medi-Cal programs as opposed to program
growth from new enrollees who have either been uninsured or
covered by private insurance.
BACKGROUND AND DISCUSSION
According to the author, this bill seeks to improve,
clarify, and update existing state law which authorizes
persons with disabilities who wish to maintain their health
coverage while working to enroll in CWD. For such persons,
the author argues, this bill provides better financial
incentives to work or to earn more. The author also claims
that eliminating the sunset provision would allow enrollees
to better plan for their work future and have long-term
incentives to continue in the program. The author points
to the disappointing low enrollment in the CWD program to
date and blames the low enrollment on administrative
obstacles that AB 1113 would reduce.
History and Implementation of the CWD Program
The federal Balanced Budget Act of 1997 provided states the
option to provide services to people with disabilities who
are working and in families that would otherwise meet SSI
eligibility criteria but for the amount of their earnings.
The program also calls for the payment of premiums or other
cost-sharing charges set on a sliding scale that the states
may determine. Currently, 250 percent of the FPL is
$25,525 per year for an individual.
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The CWD program was implemented in 2000. The program uses
federal Supplemental Security Income rules for income,
including earned income disregards (which disregard the
first $20 of income regardless of source, the first $65 of
earnings; and, half of the remaining earnings). For
married applicants, a portion of the income of the spouse
may be counted as the applicant's income. Enrollees pay
monthly premiums of $20 to $375 based on income and marital
status. All of the applicant's disability related income
is exempt from income calculation. Certain retirement
accounts and property are also exempt from the asset
calculation.
Enrollees are required to provide proof of employment. If
they lose employment due to "good cause," they can retain
CWD program coverage for two months. Under the program,
good cause includes hospitalization, inability to work as a
result of the individual's disability, or other reasons
beyond the control of the enrollee.
When it was enacted, the Department of Health Services
projected CWD program enrollment to be between 7,000 and
14,000 by June 2002. However, actual enrollment in May
2007 only reached 4,500.
In April 2003, the Lewin Group prepared a report, The
California Working Disabled Program: Lessons Learned,
Looking Ahead . The report made a number of findings,
including:
The target population includes an estimated 150,000
uninsured working disabled adults;
potential enrollees lack awareness of the program;
eligibility workers lack knowledge, but effective
training may be difficult to achieve;
There is little coordination with other agencies
occurs;
some aspects of the program detract from its
attractiveness, including difficulty in obtaining
information about the CWD program, Medi-Cal program
requirements, and the need to change to and find
providers enrolled in Medi-Cal; and,
expanding eligibility rules alone will yield small
gains in enrollment given the current enrollment
trends.
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Previous legislation
AB 2679 (Wolk) of 2004 would have extended the
sunset of CWD from January 1, 2006 to January 1, 2009.
This bill was held on the Suspense File of the Senate
Appropriations Committee.
AB 925 (Aroner, Chapter 1088, Statutes of 2002),
revised and expanded state programs to assist persons
with disabilities to become employed.
AB 155 (Migden, Chapter 820, Statutes of 1999),
established the CWD program.
Arguments in support
Supporters argue that ensuring the continuation of the
program is vital to enabling persons with disabilities to
remain eligible for affordable health coverage while
working. They are concerned that, without this program,
individuals with disabilities who are working and living
independently will be forced to reduce the number of hours
they work, or quit their jobs entirely to avoid the loss of
health care provided through Medi-Cal. They point out
that, for a person living with a disability, health care
coverage is critical to living independently. They also
state that this bill will allow the disabled to maintain
their enrollment while exercising basic rights such as
marrying whom they choose, building assets from their work
efforts or continuing to work when they reach the age of
65.
Technical amendment
Page 5, line 1
1902(r)(2) of the Social Security Act (42 U.S.C.
Sec.1396a(r)), the
PRIOR ACTIONS
Assembly Health: 12-4
Assembly Appropriations: 12-5
Assembly Floor: 50-27
POSITIONS
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Support: World Institute on Disability (sponsor)
AARP
Access to Independence
Alameda County Board of Supervisors
California Foundation for Independent Living Centers
California Primary Care Association
California State Association of Counties
California Welfare Directors Association of
California
City of Santa Monica
Disabled in State Service
Express Independence
Health Access California
Independent Living Resource Center, Inc.
Multiple Sclerosis Society
Protection & Advocacy Inc.
San Francisco AIDS Foundation
Southern California HIV Advocacy Coalition
Western Center on Law and Poverty
United Domestic Workers of America
Oppose: None received