Health Plan Funding Bill Passes, Signed into Law

SupportMonths of discussions culminated this week with the Legislature passing and the Governor signing a California Chamber of Commerce-supported special session health plan funding proposal.

SBX2 2 (E. Hernandez; D-West Covina) preserves critical funding for the state’s Medi-Cal program without undermining the affordability of commercial health care purchased by employers, families, and individuals.

In a news release announcing the signing of SBX2 2 and accompanying bills, Governor Edmund G. Brown Jr. said the legislation will result in a net tax cut, maintain more than $1 billion in critical federal funds, reduce debt by more than $400 million and direct about $300 million in new funding to help persons with developmental disabilities.

CalChamber Support

Policymakers were left with a difficult task in 2014 when the federal Centers for Medicare and Medicaid Services indicated that California’s existing managed care organization (MCO) tax, which generates approximately $1 billion a year for the state’s Medi-Cal program, did not comply with the federal rules governing provider taxes and could not be renewed in 2016.

The Governor called a special legislative session and the administration worked closely with legislators and other stakeholders on a solution.

In its support letter on SBX2 2, the CalChamber noted that any replacement proposal would have to raise enough revenue to offset the expiring tax and prevent a reduction in Medi-Cal provider reimbursements, but also would need to apply broadly to most, if not all, health care plans without creating unreasonable disparities between them that might generate pressure in the commercial health insurance marketplace to increase costs for California purchasers.

CalChamber believes SBX2 2 sufficiently meets these important goals.

In its February 23 support letter, CalChamber noted that SBX2 2 presents a comprehensive solution that is a win-win for California.

Key Votes

SBX2 2 passed the Senate 28-11 on February 29.

Ayes: B. Allen (D-Santa Monica), Beall (D-San Jose), Block (D-San Diego), Cannella (R-Ceres), de León (D-Los Angeles), Galgiani (D-Stockton), Glazer (D-Contra Costa), Hall (D-Los Angeles), Hancock (D-Berkeley), E. Hernandez (D-West Covina), Hertzberg (D-Van Nuys), Hill (D-San Mateo), Hueso (D-San Diego), Huff (R-San Dimas), Jackson (D-Santa Barbara), Lara (D-Bell Gardens), Leno (D-San Francisco), Leyva (D-Chino), Liu (D-La Cañada Flintridge), McGuire (D-Healdsburg), Mendoza (D-Artesia), Mitchell (D-Los Angeles), Monning (D-Carmel), Pan (D-Sacramento), Pavley (D-Agoura Hills), Roth (D-Riverside), Wieckowski (D-Fremont), Wolk (D-Davis).

Noes: Anderson (R-Alpine), Bates (R-Laguna Niguel), Berryhill (R-Twain Harte), Fuller (R-Bakersfield), T. Gaines (R-El Dorado Hills), Moorlach (R-Costa Mesa), Morrell (R-Rancho Cucamonga), Nielsen (R-Gerber), Runner (R-Antelope Valley), J. Stone (R-Temecula), Vidak (R-Hanford).

No Vote Recorded: Nguyen (R-Garden Grove).

SBX2 2 passed the Assembly 61-16 on February 29.

Ayes: Alejo (D-Salinas), Atkins (D-San Diego), Baker (R-San Ramon), Bigelow (R-O’Neals), Bloom (D-Santa Monica), Bonilla (D-Concord), Bonta (D-Oakland), Brown (D-San Bernardino), Burke (D-Inglewood), Calderon (D-Whittier), Campos (D-San Jose), Chau (D-Monterey Park), Chu (D-San Jose), Cooley (D-Rancho Cordova), Cooper (D-Elk Grove), Dababneh (D-Encino), Dahle (R-Bieber), Daly (D-Anaheim), Dodd (D-Napa), Eggman (D-Stockton), Frazier (D-Oakley), C. Garcia (D-Bell Gardens), E. Garcia (D-Coachella), Gatto (D-Glendale), Gipson (D-Carson), Gomez (D-Los Angeles), Gonzalez (D-San Diego), Gordon (D-Menlo Park), Gray (D-Merced), R. Hernández (D-West Covina), Holden (D-Pasadena), Irwin (D-Thousand Oaks), Jones (R-Santee), Jones-Sawyer (D-South Los Angeles), Levine (D-San Rafael), Linder (R-Corona), Lopez (D-San Fernando), Low (D-Campbell), Maienschein (R-San Diego), Mathis (R-Visalia), Mayes (R-Yucca Valley), McCarty (D-Sacramento), Medina (D-Riverside), Mullin (D-South San Francisco), Nazarian (D-Sherman Oaks), O’Donnell (D-Long Beach), Olsen (R-Modesto), Quirk (D-Hayward), Rendon (D-Lakewood), Ridley-Thomas (D-Los Angeles), Rodriguez (D-Pomona), Salas (D-Bakersfield), Santiago (D-Los Angeles), M. Stone (D-Scotts Valley), Thurmond (D-Richmond), Ting (D-San Francisco), Wagner (R-Irvine), Waldron (R-Escondido), Weber (D-San Diego), Williams (D-Carpinteria), Wood (D-Healdsburg).

Noes: Achadjian (R-San Luis Obispo), T. Allen (R-Huntington Beach), Brough (R-Dana Point), Chang (R-Diamond Bar), Chávez (R-Oceanside), B. Gaines (R-El Dorado Hills), Gallagher (R-Yuba City), Grove (R-Bakersfield), Hadley (R-Torrance), Harper (R-Huntington Beach), Lackey (R-Palmdale), Melendez (R-Lake Elsinore), Obernolte (R-Big Bear Lake), Patterson (R-Fresno), Steinorth (R-Rancho Cucamonga), Wilk (R-Santa Clarita).

Absent/Abstaining/Not Voting: Chiu (D-San Francisco), Kim (R-Fullerton).

Staff Contact: Mira Morton