Existing law, as added by Proposition 112, adopted June 5, 1990, establishes the California Citizens Compensation Commission and requires the commission to establish the annual salary and the medical, dental, insurance, and other similar benefits of state officers, including Members of the Legislature. The Public Employees Medical and Hospital Care Act, which governs health care coverage available to public employees, specifies that a Member of the Legislature is eligible to enroll in an approved health benefit plan, as defined, pursuant to that act.

Existing law establishes the California Health Benefit Exchange (Exchange) within state government, specifies the powers and duties of the board governing the Exchange, and requires the board to facilitate the purchase of qualified health plans through the Exchange by qualified individuals and small employers by January 1, 2014.

This bill would instead provide that the only health benefit plans available to a Member of the Legislature who is elected to or serving in office on or after January 1, 2016, with respect to his or her service as a Member of the Legislature, are health benefit plans that are offered through the Exchange. The bill would require the state to reimburse the Member of the Legislature for the cost of coverage in an amount not to exceed the amount of the state employers contribution for coverage for a Member as of December 31, 2015.

Date of Hearing: April 23, 2015

ASSEMBLY COMMITTEE ON RULES

Richard Gordon, Chair

ABPCA Bill Id:AB 1109

Author:(Wilk) – As Introduced Ver:February 27, 2015

SUBJECT: Legislature: health benefits coverage.

SUMMARY: Limits Members of the Legislature to health benefit plans available through the California Health Benefit Exchange. Specifically, this bill:

1. Requires that the only health benefit plans available to Members of the Legislature shall be health benefit plans offered through the California Health Benefit Exchange.

2. Requires the state to reimburse a Member for the cost of coverage in an amount not to exceed the amount of the state employer's contribution.

EXISTING LAW: Proposition 112 establishes the Citizens Compensation Commission (Commission) to set the salaries and medical, dental, insurance and other similar benefits of Members of the Legislature and the state's other elected officials. It also directs the Commission to consider specified criteria in establishing salaries and benefits.

FISCAL EFFECT: Indeterminable, should this bill pass the Rules Committee it will be referred to the Appropriations Committee for fiscal analysis.

COMMENTS: According to the author, "the legislature is responsible for passing the laws that govern how Covered California operates and as such, how Californian’s will receive their benefits within the parameters of the ACA. There is no better way to understand how the Exchange is working than for Legislators themselves to share in the same benefits program that Californian’s are required to participate in. Additionally, this could lower health care costs for Legislators depending on which plan they chose to enroll in, thereby saving the state money in both real and administrative costs."

The annual salaries and medical, dental, insurance, and other similar benefits of Members of the Legislature are determined by the California Citizens Compensation Commission pursuant to Article 3, Section 8 of the California Constitution. Consequently, changing that authority would require a constitutional amendment.

The bill would require the state to reimburse the Member for the cost of coverage in an amount not to exceed the state employer's contribution as of December 31, 2015. This provision is problematic because it does not take into account future changes to premiums or policy. This bill would lock-in contribution rates as of December 31, 2015, regardless of premium increases. Also, further clarification on the reimbursement may be necessary; it is not clear how the reimbursement process would impact administrating entities.

Opposition: According to Health Access California, "the Legislature is a large employer with more than 50 employees: employees of large employers are not eligible to participate in Covered California unless their employer fails to offer them coverage that is of at least 60% minimum value or that costs more than 9.5% of their income."

Prior legislation. AB 1246 (Nestande) failed passage in this Committee in the 2013-2014 session year.

REGISTERED SUPPORT / OPPOSITION:

Support

None on file

Opposition

Health Access California

AFSCME California

Analysis Prepared by: Mukhtar Ali / RLS. / (916) 319-2800