BILL NUMBER: AB 278	CHAPTERED
	BILL TEXT

	CHAPTER  227
	FILED WITH SECRETARY OF STATE  SEPTEMBER 24, 2010
	APPROVED BY GOVERNOR  SEPTEMBER 23, 2010
	PASSED THE SENATE  AUGUST 19, 2010
	PASSED THE ASSEMBLY  AUGUST 26, 2010
	AMENDED IN SENATE  AUGUST 17, 2010
	AMENDED IN SENATE  JULY 15, 2010
	AMENDED IN SENATE  JUNE 21, 2010
	AMENDED IN SENATE  JUNE 3, 2010

INTRODUCED BY   Assembly Member Monning

                        FEBRUARY 12, 2009

   An act to add and repeal Division 109.6 (commencing with Section
130275) of the Health and Safety Code, relating to health
information.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 278, Monning.  Health information exchange: demonstration
projects.
   Existing law establishes the Office of Health Information
Integrity within the California Health and Human Services Agency to
ensure the enforcement of state law mandating confidentiality of
medical information and to impose administrative fines for the
unauthorized use of medical information. Existing law authorizes the
California Health and Human Services Agency, or one of the
departments under its jurisdiction, to apply for federal funds made
available through the federal American Recovery and Reinvestment Act
of 2009 (ARRA) for health information technology and exchange.
   This bill would authorize the office to establish and administer
demonstration projects to evaluate potential solutions to facilitate
health information exchange that promote quality of care, respect the
privacy and security of personal health information, and enhance the
trust of the stakeholders. This bill would authorize health care
entities or governmental authorities, as defined, that receive,
share, exchange, or use a California resident's medical information
to submit an application with the office to be approved as
demonstration project participants, as defined. The bill would
authorize the office to approve annually up to 4 projects as
demonstration projects. The bill would require any costs associated
with the support, assistance, and evaluation of approved
demonstration projects to be funded exclusively by the
above-described federal funds or other non-General Fund sources. The
bill would require the office to report to prescribed committees of
the Legislature within 6 months after the end of the project.
   This bill would become inoperative on the date the Director of the
Office of Health Information Integrity executes a declaration
stating that the grant period for the above-described federal funds
has ended, and as of that date would be repealed.


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

  SECTION 1.  Division 109.6 (commencing with Section 130275) is
added to the Health and Safety Code, to read:

      DIVISION 109.6.  Health Information Exchange Privacy and
Security Demonstration Projects


   130275.  The Legislature finds and declares all of the following:
   (a) There is a need to enhance California's ability to obtain and
use federal funding, as awarded in the State Cooperative Grant
Agreement for health information exchange, for the establishment of
statewide health information exchange infrastructure in California.
The California Health and Human Services Agency is authorized by the
Legislature, under Section 130255, to use those federal funds to
achieve that purpose.
   (b) Health information exchange has the potential to significantly
improve the quality of treatment and care, reduce unnecessary health
care costs, and increase administrative efficiencies within the
health care system. The application of health information exchange
technology to manage health information will also have a significant
impact on consumers, health care facilities, and licensed health care
providers.
   (c) Current laws may not adequately protect privacy, or may impose
obstacles to the exchange of vital health information, as required
by the State Cooperative Grant Agreement for health information
exchange and other federal health information funding programs.
   (d) It is the intent of the Legislature to authorize the Office of
Health Information Integrity within the California Health and Human
Services Agency to establish and administer demonstration projects
funded by federal grants and other sources. It is the intent of the
Legislature that the demonstration projects do all of the following:
   (1) Identify barriers to implementing health information
exchanges.
   (2) Test potential security and privacy policies for the safe and
secure exchange of health information, including, but not limited to,
issues related to access to, and storage of, individual health
information.
   (3) Identify and address differences between state and federal
laws regarding privacy of health information.
   130276.  For purposes of this division, the following definitions
apply:
   (a) "Demonstration project" means a project approved and
administered by the office in accordance with this division and the
State Cooperative Grant Agreement for health information exchange or
any other similar grant or grants.
   (b) "Demonstration project participant" means a health care entity
that is approved by the office to participate in a demonstration
project.
   (c) "Director" means the Director of the Office of Health
Information Integrity.
   (d) "Governmental authority" means any municipal, county, state,
or other governmental entity that has jurisdiction and control over
the provision of, or payment for, medical services or that routinely
receives medical information to complete its designated governmental
function.
   (e) "Health information exchange service participant" means a
health care entity that has voluntarily agreed to use the health
information exchange services developed in accordance with this
division.
   (f) "Meaningful use" means the term as defined in the federal
Health Information Technology for Economic and Clinical Health Act
(HITECH Act) (Public Law 111-5) and the regulations promulgated
thereunder.
   (g) "Office" means the Office of Health Information Integrity.
   (h) "State Cooperative Grant Agreement" means the grant agreement
between the federal government and the state in which the federal
government awarded the state with grant money pursuant to the HITECH
Act in February 2010.
   130277.  The director may adopt regulations to ensure all approved
health information exchange service participants and demonstration
project participants follow rules, and work within parameters, as
defined by the office, that are consistent for the exchange of
information.
   130278.  Before adopting regulations pursuant to Section 130277,
the office shall adopt the following standards:
   (a) At least 45 days prior to adoption, the office shall post a
proposed regulation on its Internet Web site. Public comment shall be
accepted by the office for at least 30 days after the proposed
regulation is posted. If a member of the public requests a public
hearing during the 30-day review period, the hearing shall be held
prior to adoption of the regulation. The process described in this
subdivision shall apply to the adoption of new regulations and to
changes to existing regulations.
   (b) Adoption of, and changes to, regulations adopted pursuant to
this division shall not be subject to the rulemaking requirements of
Section 11343.4 and Article 5 (commencing with Section 11346) and
Article 6 (commencing with Section 11349) of Chapter 3.5 of Part 1 of
Division 3 of Title 2 of the Government Code.
   (c) The director shall file any regulation adopted pursuant to
Section 130277 with the Office of Administrative Law for filing with
the Secretary of State and publication in the California Code of
Regulations. Any regulation filed with the Office of Administrative
Law pursuant to this subdivision shall include a citation to this
section and any other applicable state or federal laws as providing
authority for the adoption of the regulation.
   (1) Any regulation adopted pursuant to Section 130277 shall become
effective on the date it is filed with the Secretary of State unless
the director prescribes a later date in the regulation or in a
written instrument filed with the regulation.
   (2) Any regulation adopted pursuant to Section 130277 shall expire
the date that this division is repealed.
   130279.  (a) The California Health and Human Services Agency,
through the office, may establish and administer demonstration
projects to evaluate potential solutions to facilitate health
information exchange that promote quality of care, respect the
privacy and security of personal health information, and enhance the
trust of the stakeholders.
   (b) Health care entities or governmental authorities, that
receive, share, exchange, or use a California resident's medical
information, may submit an application with the office to be approved
as demonstration project participants. Upon receiving an
application, the office shall do both of the following:
   (1) Assist applicants in soliciting federal funds for the
demonstration projects.
   (2) Work with applicants to define the scope of the demonstration
project.
   (c) The director may approve demonstration projects to test for,
but not limited to, any of the following areas:
   (1) Policies and practices related to patient consent, informing,
and notification.
   (2) New technologies and applications that enable the transmission
of protected health information, while increasing privacy
protections by ensuring only required health data is transmitted for
purposes and uses consistent with state and federal law.
   (3) Implementation issues, if any, encountered by small solo
health care providers as a result of exchanging electronic health
information.
   (d) The selection of demonstration projects shall be based on, but
not limited to, the following criteria:
   (1) Areas critical to building consumer trust and confidence in
the health information exchange system.
   (2) Projects that help support the exchange of information
critical to meeting the federal meaningful use provisions.
   (3) Areas recommended by the California health information
exchange consumer and industry stakeholder advisory process.
   (e) The office shall engage with health care stakeholders to
evaluate issues identified by the demonstration projects, comment
upon proposed regulations, and discuss solutions for health
information exchange.
   (f) The office may annually approve up to four projects, as
demonstration projects.
   (g) The office shall work collaboratively with approved
demonstration project participants to identify a set of common data
elements that will be used to collect, analyze, and measure
performance.
   (h) The office shall receive reports from the demonstration
project participants on the outcome of the demonstration projects no
later than 60 business days after the end of the demonstration
project.
   130280.  (a) The office shall review the results of a
demonstration project and, notwithstanding Sections 9795 and 10231.5
of the Government Code, shall report those results to the Joint
Legislative Budget Committee, the Senate Committee on Appropriations,
the Senate Committee on Budget and Fiscal Review, the Senate
Committee on Health, the Assembly Committee on Appropriations, the
Assembly Committee on Budget, and the Assembly Committee on Health
within six months after the end of a demonstration project.
   (b) The demonstration projects carried out utilizing federal grant
funds may be subject to federal auditing provisions.
   130281.  Any costs associated with the support, assistance, and
evaluation of approved demonstration projects shall be funded
exclusively by federal funds or other non-General Fund sources.
   130282.  This division shall become inoperative on the date the
director executes a declaration stating that the grant period for the
State Cooperative Grant Agreement for health information exchange
has ended, and as of that date is repealed.