BILL NUMBER: AB 120 ENROLLED
BILL TEXT
PASSED THE SENATE AUGUST 17, 2009
PASSED THE ASSEMBLY SEPTEMBER 11, 2009
AMENDED IN SENATE JULY 8, 2009
AMENDED IN SENATE JUNE 22, 2009
AMENDED IN ASSEMBLY JUNE 1, 2009
AMENDED IN ASSEMBLY MAY 18, 2009
AMENDED IN ASSEMBLY MAY 7, 2009
AMENDED IN ASSEMBLY APRIL 13, 2009
AMENDED IN ASSEMBLY MARCH 26, 2009
INTRODUCED BY Assembly Member Hayashi
(Coauthor: Assembly Member Emmerson)
JANUARY 15, 2009
An act to amend Sections 809, 809.2, and 809.3 of, and to add
Sections 809.04, 809.07, and 809.08 to, the Business and Professions
Code, relating to healing arts.
LEGISLATIVE COUNSEL'S DIGEST
AB 120, Hayashi. Healing arts: peer review.
Existing law provides for the professional review of specified
healing arts licentiates through a peer review process conducted by
peer review bodies, as defined.
This bill would encourage a peer review body to obtain external
peer review, as defined, for the evaluation or investigation of an
applicant, privilegeholder, or member of the medical staff in
specified circumstances.
This bill would require a peer review body to respond to the
request of another peer review body and produce the records
reasonably requested concerning a licentiate under review, as
specified. The bill would specify that the records produced pursuant
to this provision are not subject to discovery, as specified, and may
only be used for peer review purposes.
Existing law requires the governing body of acute care hospitals
to give great weight to the actions of peer review bodies and
authorizes the governing body to direct the peer review body to
investigate in specified instances. Where the peer review body fails
to take action in response to that direction, existing law authorizes
the governing body to take action against a licentiate.
This bill would prohibit a member of a medical or professional
staff from being required to alter or surrender staff privileges,
status, or membership solely due to the termination of a contract
between that member and a health care facility, except as specified.
The bill would specify that a peer review body is entitled to review
and make timely recommendations to the governing body of a health
care facility, and its designee, if applicable, regarding quality
considerations relating to clinical services when the selection,
performance evaluation, or any change in the retention or replacement
of licensees with whom the facility has a contract occurs. The bill
would require the governing body to give great weight to those
recommendations.
Existing law provides various due process rights for licentiates
who are the subject of a final proposed disciplinary action of a peer
review body, including authorizing a licensee to request a hearing
concerning that action. Under existing law, the hearing must be held
before either an arbitrator selected by a process mutually acceptable
to the licensee and the peer review body or a panel of unbiased
individuals, as specified. Existing law prohibits a hearing officer
presiding at a hearing held before a panel from, among other things,
gaining direct financial benefit from the outcome.
This bill would additionally require the hearing officer to be an
attorney licensed in California, except as specified, and to disclose
all actual and potential conflicts of interest, as specified. The
bill would specify that the hearing officer is entitled to determine
the procedure for presenting evidence and argument and would give the
hearing officer authority to make all rulings pertaining to law,
procedure, or the admissibility of evidence. The bill would authorize
the hearing officer to recommend termination of the hearing in
certain circumstances.
Existing law gives parties at the hearing certain rights,
including the right to present and rebut evidence. Existing law
requires the peer review body to adopt written provisions governing
whether a licensee may be represented by an attorney and prohibits a
peer review body from being represented by an attorney where a
licensee is not so represented, except as specified.
This bill would give both parties the right to be represented by
an attorney but would prohibit a peer review body from being
represented if the licensee notifies the peer review body within a
specified period of time that he or she has elected to not be
represented, except as specified.
The bill would also provide that it shall become operative only if
SB 820 is also enacted and becomes operative.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 809 of the Business and Professions Code is
amended to read:
809. (a) The Legislature hereby finds and declares the following:
(1) In 1986, Congress enacted the Health Care Quality Improvement
Act of 1986 (Chapter 117 (commencing with Section 11101) of Title 42
of the United States Code), to encourage physicians to engage in
effective professional peer review, but giving each state the
opportunity to "opt-out" of some of the provisions of the federal
act.
(2) Because of deficiencies in the federal act and the possible
adverse interpretations by the courts of the federal act, it is
preferable for California to "opt-out" of the federal act and design
its own peer review system.
(3) Peer review, fairly conducted, is essential to preserving the
highest standards of medical practice.
(4) It is essential that California's peer review system generate
a culture of trust and safety so that health care practitioners will
participate robustly in the process by engaging in critically
important patient safety activities, such as reporting incidents they
believe to reflect substandard care or unprofessional conduct and
serving on peer review, quality assurance, and other committees
necessary to protect patients.
(5) Peer review that is not conducted fairly results in harm both
to patients and healing arts practitioners by wrongfully depriving
patients of their ability to obtain care from their chosen
practitioner and by depriving practitioners of their ability to care
for their patients, thereby limiting much needed access to care.
(6) Peer review, fairly conducted, will aid the appropriate state
licensing boards in their responsibility to regulate and discipline
errant healing arts practitioners.
(7) To protect the health and welfare of the people of California,
it is the policy of the State of California to exclude, through the
peer review mechanism as provided for by California law, those
healing arts practitioners who provide substandard care or who engage
in professional misconduct, regardless of the effect of that
exclusion on competition.
(8) It is the intent of the Legislature that peer review of
professional health care services be done efficiently, on an ongoing
basis, and with an emphasis on early detection of potential quality
problems and resolutions through informal educational interventions.
It is further the intent of the Legislature that peer review bodies
be actively involved in the measurement, assessment, and improvement
of quality and that there be appropriate oversight by the peer review
bodies to ensure the timely resolution of issues.
(9) Sections 809 to 809.8, inclusive, shall not affect the
respective responsibilities of the organized medical staff or the
governing body of an acute care hospital with respect to peer review
in the acute care hospital setting. It is the intent of the
Legislature that written provisions implementing Sections 809 to
809.8, inclusive, in the acute care hospital setting shall be
included in medical staff bylaws that shall be adopted by a vote of
the members of the organized medical staff and shall be subject to
governing body approval, which approval shall not be withheld
unreasonably.
(10) (A) The Legislature thus finds and declares that the laws of
this state pertaining to the peer review of healing arts
practitioners shall apply in addition to Chapter 117 (commencing with
Section 11101) of Title 42 of the United States Code, because the
laws of this state provide a more careful articulation of the
protections for both those undertaking peer review activity and those
subject to review, and better integrate public and private systems
of peer review. Therefore, California exercises its right to opt out
of specified provisions of the Health Care Quality Improvement Act
relating to professional review actions, pursuant to Section 11111(c)
(2)(B) of Title 42 of the United States Code. This election shall not
affect the availability of any immunity under California law.
(B) The Legislature further declares that it is not the intent or
purposes of Sections 809 to 809.8, inclusive, to opt out of any
mandatory national databank established pursuant to Subchapter II
(commencing with Section 11131) of Chapter 117 of Title 42 of the
United States Code.
(b) For the purpose of this section and Sections 809.1 to 809.8,
inclusive, "healing arts practitioner" or "licentiate" means a
physician and surgeon, podiatrist, clinical psychologist, marriage
and family therapist, clinical social worker, or dentist; and "peer
review body" means a peer review body as specified in paragraph (1)
of subdivision (a) of Section 805, and includes any designee of the
peer review body.
SEC. 2. Section 809.04 is added to the Business and Professions
Code, to read:
809.04. (a) It is the public policy of the state that licentiates
who may be providing substandard care be subject to the peer review
hearing and reporting process set forth in this article.
(b) To ensure that the peer review process is not circumvented, a
member of a medical or professional staff, by contract or otherwise,
shall not be required to alter or surrender staff privileges, status,
or membership solely due to the termination of a contract between
that member and a health care facility. However, with respect to
services that may only be provided by members who have, or who are
members of a medical group that has, a current exclusive contract for
those identified services, termination of the contract, or
termination of the member's employment by the medical group holding
the contract, may result in the member's ineligibility to provide the
services covered by the contract.
(c) The peer review body of a health care facility shall be
entitled to review and make timely recommendations to the governing
body of the facility and its designee, if applicable, regarding
quality considerations relating to clinical services whenever the
selection, performance evaluation, or any change in the retention or
replacement of licentiates with whom the health care facility has a
contract occurs. The governing body shall give great weight to those
recommendations.
(d) This section shall not impair a governing body's ability to
take action against a licentiate pursuant to Section 809.05.
SEC. 3. Section 809.07 is added to the Business and Professions
Code, to read:
809.07. (a) It is the policy of the state that in certain limited
circumstances, external peer review may be necessary to promote and
protect patient care in order to eliminate perceived bias, obtain
needed medical expertise, or respond to other particular
circumstances.
(b) A peer review body is encouraged to obtain external peer
review for the evaluation or investigation of an applicant,
privilegeholder, or member of the medical staff in the following
circumstances:
(1) Committee or department reviews that could affect a licentiate'
s membership or privileges do not provide a sufficiently clear basis
for action or inaction.
(2) No current medical staff member can provide the necessary
expertise in the clinical procedure or area under review.
(3) To promote impartial peer review.
(c) For purposes of this section, the following definitions apply:
(1) "Peer review body" has the meaning provided in paragraph (1)
of subdivision (a) of Section 805.
(2) "External peer review" means peer review provided by
licentiates who do not practice in the same health care facility as
the licentiate under review, who are impartial, and who have the
necessary expertise in the clinical procedure or area under review.
SEC. 4. Section 809.08 is added to the Business and Professions
Code, to read:
809.08. (a) The Legislature hereby finds and declares that the
sharing of information between peer review bodies is essential to
protect the public health.
(b) Upon receipt of reasonable copying and processing costs, a
peer review body shall respond to the request of another peer review
body and produce the records reasonably requested concerning a
licentiate under review to the extent not otherwise prohibited by
state or federal law. The responding peer review body shall have the
discretion to decide whether to produce minutes from peer review body
meetings. The records produced by a peer review body pursuant to
this section shall be used solely for peer review purposes and shall
not be subject to discovery to the extent provided in Sections 1156.1
and 1157 of the Evidence Code and any other applicable provisions of
law. The peer review body responding to the request shall be
entitled to all confidentiality protections and privileges provided
by law as to the information and records disclosed pursuant to this
section. The licentiate under review by the peer review body
requesting records pursuant to this section shall, upon request,
release the responding peer review body, its members, and the health
care entity for which the responding peer review body conducts peer
review, from liability for the disclosure of records, and the
contents thereof, in compliance with this section. If the licentiate
does not provide a reasonable release that is acceptable to the
responding peer review body, the responding peer review body shall
not be obligated to produce records pursuant to this section.
SEC. 5. Section 809.2 of the Business and Professions Code is
amended to read:
809.2. If a licentiate timely requests a hearing concerning a
final proposed action for which a report is required to be filed
under Section 805, the following shall apply:
(a) The hearing shall be held, as determined by the peer review
body, before a trier of fact, which shall be an arbitrator or
arbitrators selected by a process mutually acceptable to the
licentiate and the peer review body, or before a panel of unbiased
individuals who shall gain no direct financial benefit from the
outcome, who have not acted as an accuser, investigator, factfinder,
or initial decisionmaker in the same matter, and which shall include,
where feasible, an individual practicing the same specialty as the
licentiate.
(b) (1) If a hearing officer is selected to preside at a hearing
held before a panel, the hearing officer shall gain no direct
financial benefit from the outcome, shall disclose all actual and
potential conflicts of interest within the last five years reasonably
known to the hearing officer, shall not act as a prosecuting officer
or advocate, and shall not be entitled to vote.
(2) The hearing officer shall be an attorney licensed to practice
law in the State of California. This paragraph shall not apply to a
hearing held before a panel of a dental professional society peer
review body.
(3) Except as otherwise agreed by the parties, an attorney from a
firm utilized by the hospital, the medical staff, or the involved
licentiate within the preceding two years shall not be eligible to
serve as a hearing officer.
(4) The hearing officer shall endeavor to ensure that all parties
maintain proper decorum and have a reasonable opportunity to be heard
and present all relevant oral and documentary evidence. The hearing
officer shall be entitled to determine the order of, or procedure
for, presenting evidence and argument during the hearing and shall
have the authority and discretion to make all rulings on questions
pertaining to matters of law, procedure, or the admissibility of
evidence. The hearing officer shall also take all appropriate steps
to ensure a timely resolution of the hearing, but may not terminate
the hearing process. However, in the case of flagrant noncompliance
with the procedural rules governing the hearing process or egregious
interference with the orderly conduct of the hearing, the hearing
officer may recommend that the hearing panel terminate the hearing,
provided that this activity is authorized by the applicable bylaws of
the peer review body.
(c) The licentiate shall have the right to a reasonable
opportunity to voir dire the panel members and any hearing officer,
and the right to challenge the impartiality of any member or hearing
officer. Challenges to the impartiality of any member or hearing
officer shall be ruled on by the presiding officer, who shall be the
hearing officer if one has been selected.
(d) The licentiate shall have the right to inspect and copy at the
licentiate's expense any documentary information relevant to the
charges which the peer review body has in its possession or under its
control, as soon as practicable after the receipt of the licentiate'
s request for a hearing. The peer review body shall have the right to
inspect and copy at the peer review body's expense any documentary
information relevant to the charges which the licentiate has in his
or her possession or control as soon as practicable after receipt of
the peer review body's request. The failure by either party to
provide access to this information at least 30 days before the
hearing shall constitute good cause for a continuance. The right to
inspect and copy by either party does not extend to confidential
information referring solely to individually identifiable
licentiates, other than the licentiate under review. The arbitrator
or presiding officer shall consider and rule upon any request for
access to information, and may impose any safeguards the protection
of the peer review process and justice requires.
(e) When ruling upon requests for access to information and
determining the relevancy thereof, the arbitrator or presiding
officer shall, among other factors, consider the following:
(1) Whether the information sought may be introduced to support or
defend the charges.
(2) The exculpatory or inculpatory nature of the information
sought, if any.
(3) The burden imposed on the party in possession of the
information sought, if access is granted.
(4) Any previous requests for access to information submitted or
resisted by the parties to the same proceeding.
(f) At the request of either side, the parties shall exchange
lists of witnesses expected to testify and copies of all documents
expected to be introduced at the hearing. Failure to disclose the
identity of a witness or produce copies of all documents expected to
be produced at least 10 days before the commencement of the hearing
shall constitute good cause for a continuance.
(g) Continuances shall be granted upon agreement of the parties or
by the arbitrator or presiding officer on a showing of good cause.
(h) A hearing under this section shall be commenced within 60 days
after receipt of the request for hearing, and the peer review
process shall be completed within a reasonable time, after a
licentiate receives notice of a final proposed action or an immediate
suspension or restriction of clinical privileges, unless the
arbitrator or presiding officer issues a written decision finding
that the licentiate failed to comply with subdivisions (d) and (e) in
a timely manner, or consented to the delay.
SEC. 6. Section 809.3 of the Business and Professions Code is
amended to read:
809.3. (a) During a hearing concerning a final proposed action
for which reporting is required to be filed under Section 805, both
parties shall have all of the following rights:
(1) To be provided with all of the information made available to
the trier of fact.
(2) To have a record made of the proceedings, copies of which may
be obtained by the licentiate upon payment of any reasonable charges
associated with the preparation thereof.
(3) To call, examine, and cross-examine witnesses.
(4) To present and rebut evidence determined by the arbitrator or
presiding officer to be relevant.
(5) To submit a written statement at the close of the hearing.
(6) To be represented by an attorney of the party's choice at the
party's expense, subject to subdivision (c).
(b) The burden of presenting evidence and proof during the hearing
shall be as follows:
(1) The peer review body shall have the initial duty to present
evidence which supports the charge or recommended action.
(2) Initial applicants shall bear the burden of persuading the
trier of fact by a preponderance of the evidence of their
qualifications by producing information which allows for adequate
evaluation and resolution of reasonable doubts concerning their
current qualifications for staff privileges, membership, or
employment. Initial applicants shall not be permitted to introduce
information not produced upon request of the peer review body during
the application process, unless the initial applicant establishes
that the information could not have been produced previously in the
exercise of reasonable diligence.
(3) Except as provided above for initial applicants, the peer
review body shall bear the burden of persuading the trier of fact by
a preponderance of the evidence that the action or recommendation is
reasonable and warranted.
(c) (1) Except as provided in paragraph (3), a peer review body
shall not be represented by an attorney if the licentiate notifies
the peer review body in writing no later than 15 days prior to the
hearing that he or she has elected to not be represented by an
attorney. Except as otherwise agreed by the parties, this election
shall be binding.
(2) If the licentiate does not provide the written notice
described in paragraph (1) within the required timeframe, the peer
review body may be represented by an attorney even if the licentiate
later elects to not be represented by an attorney.
(3) Dental professional society peer review bodies may be
represented by an attorney, even if the licentiate declines to be
represented by an attorney.
SEC. 7. This act shall become operative only if Senate Bill 820 of
the 2009-10 Regular Session is also enacted and becomes operative.