The California Partnership

  SB2 - Health Care for Low-Income Californians

The California Partnership is helping to defend SB-2 from repeal by big business and to improve the bill for lowest income workers and their families.

Read our position on SB2 - CA Partnership

Read the Fact Sheet below on what needs to be done to eliminate some of the weaknesses of this bill. - Maternal Child Health Access.

To contact your state representatives about this legislation, please look up their contact info on the website of the CA Assembly. (click on "Find My District")
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c. 2003-04 California Partnership
8201 Fourth St., Suite G, Downey, CA 90241
(562) 862-2070

March 2004

CAP strongly supports legislative efforts to expand comprehensive and affordable health coverage to uninsured Californians. We therefore support the intent of SB 2 to ensure that employees have health insurance by requiring employers to provide it or pay into a purchasing pool (“the Fund”).

We believe, however, that SB 2 should be clarified to specify that:

    1. the employer’s contribution toward the employee’s health insurance would be used to draw down federal matching funds for employees and dependents enrolled in Medi-Cal or Healthy Families, regardless of whether the employer is offering health insurance or paying into the Fund; and
    2. a seamless health insurance program should be created under the Fund that preserves all existing benefits and rights without resorting to a “wraparound” for persons eligible for Medi-Cal and Healthy Families.

We also believe that, at a minimum, SB 2 must be clarified in the following ways to protect the existing rights of low-income workers and their dependents to comprehensive and affordable health insurance. Once the following proposals and /or clarifications are adopted, we will work to ensure that SB 2 is fully implemented.

  1. All employees must be provided with information about the eligibility requirements for Medi-Cal and Healthy Families and given the opportunity to make an informed choice about participating in these programs, regardless of whether the employer is offering health insurance or paying into the Fund.

    For choice to be informed, all employees must be notified of the impacts of electing health coverage directly from employers or from the Fund when they or their dependents are eligible for Medi-Cal or Healthy Families, including specifically:
    • the employee’s obligation to share in the cost of such health coverage, including premiums, co-pays and deductibles;
    • whether the employee will be reimbursed for any of the costs, and if so, how they will be reimbursed;
    • the scope of benefits; and
    • the grievance process that will be available to resolve problems accessing health care services.
  2. Employees and their dependents who are eligible for Medi-Cal or Healthy Families must have the choice of participating in these two programs as their sole source of insurance rather than be required to obtain health coverage from the employer or the Fund and limited to using Medi-Cal or Healthy Families benefits only as a “wrap-around.” However, all employees and dependents covered by SB 2 should have the right to elect health coverage offered by the employer or the Fund as well as to be at the same time in Medi-Cal, Healthy Families or any other public health program for which they qualify.
  3. Using the existing “Accelerated Enrollment” program for children as the model, workers who are screened eligible for, or whose dependents are screened eligible for, Medi-Cal or Healthy Families should be immediately enrolled and should be reimbursed for the “employee contribution” required by SB 2 at the same time it is taken out of the employee’s paycheck at least up until the time that a final eligibility determination for Medi-Cal or Healthy Families is made.


SB2 Fact Sheet: Impact on Lowest Income Workers
Where Do We Go Next?

c. Maternal Child Health Access, 2003

SB 2 is a major leap forward toward health insurance for all, benefiting an estimated 1.2 million people and tapping into employers as a new health care funding stream.

But without clean up amendments before implementation on January 1, 2006, SB 2 could result in the further impoverishment of at least as many or many more of the lowest income employed mothers and fathers and their children-- those who are eligible for Medi-Cal or Healthy Families under existing law.

These families could also lose access to some of the key health benefits available to them now under the Medi-Cal and Healthy Families programs.

The genuine gains of SB 2 do not have to come at the price of making the poorest workers and their children worse off.

(1) 5% or more of wages will be taken out of the paychecks of low-income employees who could qualify for no-cost Medi-Cal or low-cost Healthy Families. Deductibles and co-pays would have to be paid on top of that, and these could be quite high. This cost-shift applies even to pregnant women and to parents with jobs who are on CalWORKs. Very low-income workers and their children could become homeless or go without food as a result of SB 2, waiting for the state to reimburse them their wages: these families don't have the economic margins to survive a de facto pay cut for months on end.

-- For example, a two-parent working family with two children qualifies for no-cost Medi-Cal for all family members with annual income of up to 100% of the poverty level ($18,408 a year, $1,534 a month, for a family of four in 2003-04.) Under SB 2, $920 a year ($77 a month) could be taken out of the parents' wages, plus the family would likely have to pay high deductibles and co-pays to use health benefits at all.

-- As another example, if a woman in a family of four became pregnant, she could qualify for free comprehensive pregnancy-related care under Medi-Cal with family income up to 200% of poverty. Under SB 2, she could instead have to pay $1,840 or more in annual fees ($154 a month). In addition, she would likely have to pay high deductibles and co-pays in order to access prenatal care.

-- Proposed clean-up amendments: When final eligibility is determined, reimburse at the same time the payroll deduction is taken.

(2) SB 2 has no timeframe for reimbursement to low-income workers even after they do enroll in Medi-Cal or their children enroll in Medi-Cal or Healthy Families. Low-income families will likely be waiting months before the wage-earner gets reimbursed by the state for the money taken up front from her paycheck while an eligibility determination is being made for Medi-Cal or Healthy Families. She will also be out-of-pocket for deductibles and co-pays during this time if she wants to use health benefits for herself or her family at all; these additional costs could amount to hundreds of dollars. How will low-income working parents and their children survive in the meantime? Ironically, many will go without the health care their wages are being reduced to pay for, rather than spend money on insurance deductibles and be left with even less cash to buy food or pay the rent.

-- Proposed amendments: See proposal immediately above, plus exempt families from deductibles and co-pays while they are applying for Medi-Cal or Healthy Families.

(3) Accessing benefits will be much harder for working families with children who are eligible for Medi-Cal or Healthy Families when SB 2 limits important medical services to "wraparound" programs. Examples of services likely to become much harder and expensive to use are dental, vision, rehab services, mental health, some prescription drugs.

-- Proposed clean-up amendment: Drop the mandatory "wraparound." Instead, create a seamless enrollment system that truly integrates the Medi-Cal and Healthy Families benefits, as well as cost-sharing protections, into the SB 2 program.


To contact your state representatives about this legislation, please look up their contact info on the website of the CA Assembly. (click on "Find My District")