BILL NUMBER: SB 1359	CHAPTERED  09/09/04

	CHAPTER  394
	FILED WITH SECRETARY OF STATE  SEPTEMBER 9, 2004
	APPROVED BY GOVERNOR  SEPTEMBER 9, 2004
	PASSED THE SENATE  AUGUST 17, 2004
	PASSED THE ASSEMBLY  AUGUST 12, 2004
	AMENDED IN ASSEMBLY  JULY 19, 2004
	AMENDED IN SENATE  MAY 24, 2004
	AMENDED IN SENATE  APRIL 28, 2004

INTRODUCED BY   Senators Brulte and Escutia

                        FEBRUARY 18, 2004

   An act to add Section 14107.13 to the Welfare and Institutions
Code, relating to Medi-Cal.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1359, Brulte.  Medi-Cal:  notices.
   Existing law provides for the Medi-Cal program, which is
administered by the State Department of Health Services, pursuant to
which medical benefits are provided to public assistance recipients
and other low-income persons.
   This bill would require the department, in conjunction with the
Department of Justice, to identify those areas of the fee-for-service
Medi-Cal program that are at greatest risk of fraud or abuse.  The
bill would require the department to provide a notice to confirm to,
and request confirmation of service from, identified recipients of
benefits and referring and rendering providers of benefits under the
fee-for-service Medi-Cal program.


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


  SECTION 1.  Section 14107.13 is added to the Welfare and
Institutions Code, to read:
   14107.13.  (a) (1) The department, in conjunction with the
Department of Justice, shall identify those areas of the
fee-for-service Medi-Cal program that are at greatest risk of fraud
or abuse.
   (2) In an effort to curb the fraud and abuse, the department shall
do one or both of the following:
   (A) Request confirmation of service from beneficiaries that
services or goods were actually received.
   (B) Request confirmation of service from referring and rendering
providers that the referring providers actually authorized and the
rendering providers actually delivered services or goods underlying
claims for reimbursement.
   (3) For purposes of this section, "areas" includes, but is not
limited to, provider types, services, aid code categories, and
geographic areas.
   (b) For any fee-for-service benefit, the department shall provide
a notice to confirm service to the following:
   (1) The recipient of the benefits.
   (A) Notices under this paragraph shall be provided no more
frequently than once per calendar month and shall detail all benefits
reportedly received that are relevant to the suspected fraudulent or
abusive activity identified in paragraph (1) of subdivision (a).
   (B) Notwithstanding subparagraph (A), a notice shall not be
provided to a beneficiary who has not received benefits that are
relevant to the suspected fraudulent or abusive activity identified
in paragraph (1) of subdivision (a).
   (2) The referring and rendering providers of benefits.
   (A) Notices under this paragraph shall be provided no more
frequently than one per calendar month and shall detail all referrals
for benefits and all benefits rendered that are relevant to the
suspected fraudulent or abusive activity identified in paragraph (1)
of subdivision (a).
   (B) Notwithstanding subparagraph (A), a notice shall not be sent
to a provider who has made no referrals for benefits nor rendered
benefits that are relevant to the suspected fraudulent or abusive
activity identified in paragraph (1) of subdivision (a).
   (C) Notwithstanding subparagraph (A), a notice shall not be sent
to a provider who receives a remittance advice from the state.
   (D) Subject to subdivision (e), notices under this paragraph shall
be sent to the provider's mailing address, facsimile number, or
electronic mail address, of record with the appropriate licensing
agency.
   (c) The notices required by this section shall be sent for as long
as the department, in conjunction with the Department of Justice,
deems it necessary for fraud control purposes.
   (d) The notices required by this section shall be adopted jointly
by the department and the Department of Justice.
   (e) The notices required by this section shall be transmitted
electronically, via facsimile, or by mail, whichever is most
cost-effective, practicable, and consistent with state and federal
privacy laws and regulations.
   (f) Notices sent to beneficiaries pursuant to paragraph (1) of
subdivision (b) shall comply with the Medi-Cal threshold language
requirements that apply to Medi-Cal managed care plans.