SB 139 MEDICAID TRUST FUND

Sen George K Munoz

Actions: [2] SCC/SHPAC/SFC-SCC [4]germane-SHPAC

Scheduled: Not Scheduled

 SB 139 creates the Medicaid Trust Fund with an appropriation of $1,000,000,000 which may be invested by the State Investment Officer with appropriate supervisi202oin. Reporting to various Legislative Committees. 

 Synopsis: SB139 relates to public finance by creating the Medicaid Trust Fund and the state-supported Medicaid Fund, while transferring from the General Fund to the Medicaid Trust Fund
Analysis: SB139 creates the Medicaid Trust Fund and allows the State Investment Officer to make investments in that fund with the approval of the State Investment Council. 
Also, (1) in accordance with the prudent investor rule set forth in the Uniform Prudent Investor Act; and (2) in consultation with the state treasurer.
The Investment Offices is to make quarterly reports to the Legislative Finance Committee and the State Investment Council. Annually, a report shall be submitted no later than October 1 to the Legislative Finance Committee, the Revenue Stabilization and Tax Policy Committee and any other appropriate interim committees.
On July 1, 2027 and each July 1 thereafter, a distribution shall be made from the trust fund to the state supported Medicaid fund in an amount equal to five percent of the average of the year-end market values of the trust fund for the immediately preceding three calendar years. If, on July 1 of a year, distributions have been made for less than three calendar years, the distribution shall be in an amount equal to five percent of the average of the year-end market values of the trust fund for the immediately preceding number of calendar years that distributions have been made.
money in the medicaid trust fund may be expended in the event that general fund balances, including all authorized revenues and transfers to the general fund and balances in the general fund operating reserve, the appropriation contingency fund and the tax stabilization reserve, will not meet the level of appropriations authorized from the general fund for a fiscal year. In that event, to avoid an unconstitutional deficit, the legislature may appropriate from the trust fund to the general fund only in the amount necessary to meet general fund appropriations for that fiscal year and only if the legislature has authorized transfers from the appropriation contingency fund, the general fund operating reserve and the tax stabilization reserve that exhaust those fund balances.
The Medicaid Trust Fund is to be administered by the Health Care Authority, while appropriations are to be made by the Legislature in support of the Medicaid program. The Fund is non-reverting.
One billion dollars ($1,000,000,000) is to be transferred from the General Fund to the Medicaid Trust Fund. 
The effective date of the provisions of this Act is July 1, 2024.