Bill Text: CA SB33 | 2015-2016 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Medi-Cal: estate recovery.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Failed) 2016-11-30 - From Assembly without further action. [SB33 Detail]

Download: California-2015-SB33-Amended.html

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BILL NUMBER: SB 33	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JUNE 1, 2015
	AMENDED IN SENATE  APRIL 6, 2015
	AMENDED IN SENATE  MARCH 17, 2015
	AMENDED IN SENATE  MARCH 11, 2015

INTRODUCED BY   Senator Hernandez

                        DECEMBER 1, 2014

   An act to amend Section 14009.5 of the Welfare and Institutions
Code, relating to Medi-Cal.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 33, as amended, Hernandez. Medi-Cal: estate recovery.
   Existing law provides for the Medi-Cal program, which is
administered by the State Department of Health Care Services and
under which qualified low-income persons receive health care
benefits. The Medi-Cal program is, in part, governed and funded by
federal Medicaid provisions.
   Existing federal law requires the state to seek adjustment or
recovery from an individual's estate for specified medical
assistance, including nursing facility services, home and
community-based services, and related hospital and prescription drug
services, if the individual was 55 years of age or older when he or
she received the medical assistance. Existing federal law allows the
state, at its own option, to seek recovery for any items or services
covered under the state's Medicaid plan.
   Existing state law, with certain exceptions, requires the
department to claim against the estate of a decedent, or against any
recipient of the property of that decedent by distribution or
survival, an amount equal to the payments for Medi-Cal services
received or the value of the property received by any recipient from
the decedent by distribution or survival, whichever is less. Existing
law provides for certain exemptions that restrict the department
from filing a claim against a decedent's property, including when
there is a surviving spouse during his or her lifetime. Existing law
requires the department, however, to make a claim upon the death of
the surviving spouse, as prescribed. Existing law requires the
department to waive its claim, in whole or in part, if it determines
that enforcement of the claim would result in a substantial hardship,
as specified. Existing law, which has been held invalid by existing
case law, provides that the exemptions shall only apply to the
proportionate share of the decedent's estate or property that passes
to those recipients, by survival or distribution, who qualify for the
exemptions.
   This bill would instead require the department to make these
claims only in specified circumstances for those health care services
that the state is required to recover under federal law, and would
define health care services for these purposes. The bill would limit
any claims against the estate of a decedent to only the real and
personal property or other assets the state is required to seek
recovery from under federal law. The bill would delete the
proportionate share provision and would delete the requirement that
the department make a claim upon the death of the surviving spouse.
The bill would require the department to waive its claim when the
estate subject to recovery is a homestead of modest value, as
defined. The bill would limit the amount of interest that is entitled
to accrue on a voluntary postdeath lien, as specified. The bill
would also require the department to provide a current or former
beneficiary, or his or her authorized representative, upon 
request and free of charge,   request,  with the
total amount of Medi-Cal expenses that have been paid on his or her
behalf that would be recoverable under these provisions, as
specified. The bill would apply the changes made by these provisions
only to individuals who die on or after January 1, 2016.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  (a) The Legislature finds and declares all of the
following:
   (1) Existing federal law (42 U.S.C. Sec. 1396p) requires state
Medicaid programs to seek reimbursement from the estates of deceased
Medicaid beneficiaries, or from any recipient of the decedent's
property by distribution or survival, for Medicaid paid services
received on or after 55 years of age, unless specific exemptions or
other limitations apply.
   (2) Federal law requires states to collect for long-term services
and supports for individuals 55 years of age or older, and gives
states the option to collect for other health care services.
   (3) Federal law permits states to collect from the surviving
spouse of a Medi-Cal beneficiary, but does not require collection
upon the passing of a spouse of a deceased Medi-Cal beneficiary.
   (4) Federal law defines "estate" for purposes of estate recovery
to include all real and personal property and other assets included
within the individual's estate, as defined for purposes of state
probate law, and permits states to have a broader definition of
estate.
   (5) The State Medicaid Manual allows states to establish an undue
hardship exemption from estate recovery for a homestead of "modest
value," defined as a home valued at 50 percent or less of the average
price of homes in the county where the homestead is located as of
the date of the beneficiary's death.
   (6) Estate recovery is unfair to low-income individuals who need
Medi-Cal for basic health care coverage, is a deterrent to signing
individuals up for Medi-Cal, and is counter to both state and federal
efforts to enroll individuals into health care coverage.
   (7) By recovering for health care services beyond what is required
by federal law, California forces low-income individuals 55 years of
age or older to choose between signing up for basic health care
services and passing on their home and other limited assets they
possess to their children.
   (8) California's estate recovery program undermines the idea of
Medi-Cal as a health care entitlement program by essentially turning
Medi-Cal coverage for basic medical services into a loan program,
with collection taking place at death.
   (9) Estate recovery unfairly places part of the burden of
financing the cost of health care in Medi-Cal on the estates of
deceased Medi-Cal beneficiaries with limited assets.
   (10) Estate recovery is inequitable as other social and health
care programs, such as tax-subsidized coverage through the California
Health Benefit Exchange, commonly referred to as Covered California,
and the broadly financed federal Medicare program, do not have
estate recovery.
   (11) California does not adequately inform individuals on how to
obtain information on the amounts that will be collected from their
estate, and charges individuals $25 to find out how much Medi-Cal has
spent on their behalf.
   (b) It is the intent of the Legislature, with the enactment of
this act, to do all of the following:
   (1) Limit Medi-Cal estate recovery to only those services required
to be collected for under federal law.
   (2) Limit the definition of "estate" to include only the real and
personal property and other assets required to be included within the
definition of "estate" under federal law.
   (3) Require the State Department of Health Care Services to
implement the option in the State Medicaid Manual to waive its claim,
as a substantial hardship, when the estate, subject to recovery, is
a homestead of modest value.
   (4) Prohibit recovery from the surviving spouse of a deceased
Medi-Cal beneficiary.
   (5) Ensure that Medi-Cal beneficiaries can easily and timely
receive information about how much their estate will owe Medi-Cal
when they die.
  SEC. 2.  Section 14009.5 of the Welfare and Institutions Code is
amended to read:
   14009.5.  (a) Notwithstanding any other provision of this chapter,
the department shall claim against the estate of the decedent, or
against any recipient of the property of that decedent by
distribution an amount equal to the payments for the health care
services received or the value of the property received by any
recipient from the decedent by distribution, whichever is less, only
in either of the following circumstances:
   (1) Notwithstanding paragraph (2), against the real property of a
decedent who was an inpatient in a nursing facility in accordance
with Section 1396p(b)(1)(A) of Title 42 of the United States Code.
   (2) (A) The decedent was 55 years of age or older when the
individual received health care services.
   (B) The department shall not claim under this paragraph when there
is any of the following:
   (i) A surviving spouse.
   (ii) A surviving child who is under 21 years of age.
   (iii) A surviving child who is blind or permanently and totally
disabled, within the meaning of Section 1614 of the federal Social
Security Act (42 U.S.C. Sec. 1382c).
   (b) (1) The department shall waive its claim, in whole or in part,
if it determines that enforcement of the claim would result in
substantial hardship to other dependents, heirs, or survivors of the
individual against whose estate the claim exists.
   (2) In determining the existence of substantial hardship, in
addition to other factors considered by the department consistent
with federal law and guidance, the department shall waive its claim
when the estate subject to recovery is a homestead of modest value.
   (3) The department shall notify individuals of the waiver
provision and the opportunity for a hearing to establish that a
waiver should be granted.
   (c) If the department proposes and accepts a voluntary postdeath
lien, the voluntary postdeath lien shall accrue interest at the rate
equal to the monthly average received on investments in the Surplus
Money Investment Fund or simple interest at 7 percent per annum,
whichever is lower.
   (d) (1) The department shall provide a current or former
beneficiary, or his or her authorized representative designated under
Section 14014.5, upon  request and free of charge, 
 request,  with the total amount of Medi-Cal expenses that
have been paid on behalf of that beneficiary that would be
recoverable under this section. 
   (2) A current or former beneficiary, or his or her authorized
representative designated under Section 14014.5, shall receive, upon
request, a copy of the information requested pursuant to this
subdivision once per calendar year for a reasonable fee not to exceed
five dollars ($5) if the current or former beneficiary meets either
of the following descriptions:  
   (A) An individual who is 55 years of age or older when the
individual received health care services. 
   (B) A permanently institutionalized individual who is an inpatient
in a nursing facility, intermediate care facility for the
intellectually disabled, or other medical institution.  

   (2) 
    (3)  The department shall permit a beneficiary to
request the information described in paragraph (1) through the
Internet, by telephone, by mail,  in person,  or
through other commonly available electronic means. 
   (3) 
    (4)  The department shall conspicuously post on its
Internet Web site, a description of the methods by which a request
under this subdivision may be made, including, but not limited to,
the department's telephone number and any addresses that may be used
for this purpose. The department shall also include this information
in its pamphlet for the Medi-Cal Estate Recovery Program and any
other notices the department distributes to beneficiaries regarding
estate recovery. 
   (4) 
    (5)  Upon receiving a request for the information
described in paragraph (1), the department shall provide the
information requested within  30   90  days
after receipt of the request.
   (e) The following definitions shall govern the construction of
this section:
   (1) "Decedent" means a beneficiary who has received health care
under this chapter or Chapter 8 (commencing with Section 14200) and
who has died leaving property to others either through distribution
or survival.
   (2) "Dependents" includes, but is not limited to, immediate family
or blood relatives of the decedent.
   (3) "Estate" means all real and personal property and other assets
that are required to be subject to a claim for recovery pursuant to
Section 1396p(b)(4)(A) of Title 42 of the United States Code. "Estate"
shall not include any other real and personal property or other
assets in which the individual had any legal title or interest at the
time of death, to the extent of that interest,  including
any assets conveyed to a survivor, heir, or assign of the decedent
through joint tenancy, tenancy in common, survivorship, life estate,
living trust, or other arrangement,  consistent with Section
1396p(b)(4)(B) of Title 42 of the United States Code.
   (4) "Health care services" means only those services required to
be recovered under Section 1396p(b)(1)(B)(i) of Title 42 of the
United States Code.
   (5) "Homestead of modest value" means a home whose fair market
value is 50 percent or less of the average price of homes in the
county where the homestead is located, as of the date of the decedent'
s death.
   (f) The amendments made to this section by the act that added this
subdivision shall apply only to individuals who die on or after
January 1, 2016.