Assembly Rejects Bill To Fine Big Businesses With Workers in Medi-Cal

On Thursday, the California Assembly rejected a bill (AB 880) that would have penalized large employers if they do not pay workers enough to keep them out of Medi-Cal, California's Medicaid program, the Los Angeles Times reports (Terhune, Los Angeles Times, 6/27).

Details of Bill

Under the bill -- which was introduced by Assembly member Jimmy Gomez (D-Los Angeles) -- the Affordable Care Act threshold for fining businesses would have been lowered so that large employers would be penalized if their part- or full-time workers are enrolled in Medi-Cal.

The legislation -- which was supported by the California Labor Federation and United Food and Commercial Workers -- aimed to encourage large businesses to offer job-based coverage.

While the amount of the fine had not been specified, the penalty could have been about equal to the cost of providing job-based coverage.

Funds raised from the penalty would have been used to increase Medi-Cal reimbursements for health care providers and subsidize state costs for the program.

Sara Flocks -- a policy coordinator for the California Labor Federation -- said the businesses that could have been affected by the bill include companies like Wal-Mart and a variety of chain restaurants and janitorial companies (California Healthline, 5/29).

Details of the Vote

Forty-six Assembly members voted in favor of the bill, eight votes short of the two-thirds majority required for passage.

The legislation previously had failed on three separate roll-call votes (Sanders, Sacramento Bee, 6/28).

However, the measure could be called for reconsideration as early as next week, according to the Times (Los Angeles Times, 6/27).

During discussion on the bill, Gomez said it was a way to keep "the largest and most profitable companies" from "shirk[ing] their responsibility" to provide employer-based health coverage.

However, Assembly member Tim Donnelly (R-Twin Peaks) said the bill would negatively affect "companies that have done nothing wrong" (Sacramento Bee, 6/28).

Broadcast Coverage

Headlines and links to broadcast coverage of the AB 880 vote are provided below.

"Large Employer Health Care Penalty Fails To Pass California Assembly" (Bartolone, “KXJZ News,” Capital Public Radio, 6/27).
"State Assembly Kills So-Called Wal-Mart Bill" (Small, "Represent!," KPCC, 6/27).

This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.