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.
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.
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.
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
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.