BILL ANALYSIS
AB 411
Page 1
Date of Hearing: April 28, 2009
ASSEMBLY COMMITTEE ON HEALTH
Dave Jones, Chair
AB 411 (Garrick and Harkey) - As Amended: April 16, 2009
SUBJECT : Health facilities: seismic safety.
SUMMARY : Permits the Tri-City Medical Center in Oceanside to
seek a seven-year extension of current seismic retrofit
deadlines from the Office of Statewide Health Planning and
Development (OSHPD) to allow the hospital additional time to
achieve compliance. Permits an extension of the current seismic
replacement deadlines for a health district if a ballot measure
to fund compliance has been rejected and an extension request is
filed with OSHPD by June 30, 2009.
EXISTING LAW :
1)Establishes OSHPD approval authority over the construction of
health care facilities.
2)Establishes the Alfred E. Alquist Hospital Facilities Seismic
Safety Act (Act), and its amendments, which require:
a) After January 1, 2008, any general acute care hospital
building determined to be a potential risk for collapse or
significant loss of life to only be used for nonacute care
hospital purposes. Authorizes a delay to be granted by
OSHPD upon a demonstration that compliance will result in a
loss of health care capacity;
b) OSHPD to authorize extensions to the deadline described
in 2) a) above if the hospital agrees that by January 1,
2013, designated services will be provided by moving into
an existing conforming building, relocating to a
newly-built building, or continuing in the retrofitted
building, as specified, and permits an additional two-year
extension under certain circumstances;
c) OSHPD to authorize extensions to the deadline described
in 2) a) and 2) b)above to the year 2020, by filing a
declaration with OSHPD that the owner lacks financial
capacity to comply with the law;
d) No later than January 1, 2030, owners of all acute care
inpatient hospitals to demolish, replace, or change
non-acute care use of all hospital buildings not in
substantial compliance, and to seismically retrofit all
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acute care inpatient hospital buildings so that they are in
substantial compliance; and,
e) Any hospital eligible for an extension described in 2)
a) and 2) b) above to meet the January 1, 2030 deadline.
FISCAL EFFECT : This bill has not yet been analyzed by a fiscal
committee.
COMMENTS :
1)PURPOSE OF THIS BILL . According to the author's office,
Tri-City Medical Center (Tri-City) in Oceanside has failed in
three attempts to raise bond initiative financing to pay for
the hospital's seismic retrofit. Tri-City has made a good
faith effort to meet current standards, claims the author, but
the district simply cannot achieve the super majority vote
necessary to authorize bond financing for the seismic
mandates. Without an extension of the deadlines, the author
fears closure of Tri-City is very likely. This closure, in
the opinion of local mayors, would have a devastating effect
on the cities of Oceanside, Carlsbad, and Vista which all
depend on the hospital for vital health services and essential
economic activity.
2)BACKGROUND . California's hospital seismic safety law, SB 1953
(Alquist), Chapter 740, Statutes of 1994, was passed by the
Legislature a few months after the Northridge earthquake. SB
1953 revised legislation enacted in 1971 following the Sylmar
earthquake. SB 1953 requires every hospital building to
comply with two deadlines. By January 1, 2008 (or no later
than January 1, 2013, if an extension has been granted), every
hospital building must meet specific construction standards
established to keep these structures standing after a major
earthquake. By January 1, 2030, the law requires all hospital
buildings to comply with standards intended to keep these
buildings operational following a severe quake.
Based on an April 2001 survey by OSHPD, approximately 40% of the
state's 2,700 hospital buildings must either be retrofitted or
rebuilt to meet the 2008 and 2013 construction standards.
Those buildings that don't meet this requirement must be
closed to patient care. A 2007 RAND study commissioned by the
California HealthCare Foundation (CHCF) indicates that the
pace of compliance efforts has been very slow and that total
construction costs to rebuild facilities will range from $45
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billion to $110 billion. CHCF points out that the costs
estimates include significant modernization and redesign of
facilities 50 years old or older and are not solely
attributable to seismic safety compliance.
On November 14, 2007 the California Building Standards
Commission approved the implementation of a state-of-the-art
risk technology, HAZUS (Hazards U.S. Multi-Hazard), to
reexamine the seismic risk of Structural Performance
Category-1 (SPC-1) hospital buildings. These buildings are
considered at risk of collapse in the event of an earthquake
or other natural disaster and must be retrofitted, replaced,
or removed from providing acute care services by 2013. This
reassessment allows OSHPD to reprioritize SPC-1 hospital
buildings based on their level of seismic risk and if they
meet specified criteria, move the building to SPC-2 category.
If reclassified, these hospital buildings would move from a
2008 and 2013 seismic deadline to a 2030 deadline. It is
estimated that 50% to 60% of the 1100 SPC-1 buildings would
qualify for the reclassification under the new HAZUS
methodology.
According to OSHPD, as of July 2008, California hospitals have
submitted approximately 250 buildings for HAZUS reevaluation.
OSHPD's Facilities Development Division has completed 125
evaluations with another 125 in progress. Of the completed
building (or 54.4% of the buildings) moved from the SPC-1
designation to the SPC-2 designation. Fifty-one buildings (or
40.8%) of the SPC-1 buildings tested remained in that
category. The final filing date for HAZUS reevaluation is
July 1, 2009.
Tri-City Medical Center has applied for HAZUS review of three
structures including the central tower, south tower, and south
tower stair shaft. Based on the HAZUS reevaluation, the south
tower has been upgraded to a SPC-2 building and is no longer
subject to the 2013 deadline, but is subject to the 2030
deadline. OSHPD reports the HAZUS evaluation of Tri-City's
remaining buildings requires materials testing and is ongoing.
In March of this year, OSHPD denied Tri-City's application
for an extension under SB 306 (Ducheny), Chapter 642, Statutes
of 2006, based on the hospital's failure to meet the specified
financial criteria.
3)SUPPORT . The Association of California Healthcare Districts,
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in support of this bill, states that this proposal will
provide district hospitals that have run out of options an
additional, necessary opportunity to meet their obligation to
protect their patients and staff.
4)OPPOSITION . The Service Employees International Union (SEIU),
in opposition, believes that the voters repeated rejection of
hospital bond authority, while regrettable, represented the
public's decision to avoid compliance with the law. SEIU
believes it would be a policy mistake to extend the retrofit
deadlines for an unsafe hospital.
5)PREVIOUS AND RELATED LEGISLATION .
a) AB 303 (Beall) allows specified county and University of
California disproportionate share hospitals that contract
with the California Medical Assistance Commission to serve
Medi-Cal patients to receive supplemental Medi-Cal
reimbursement from the Construction and Renovation
Reimbursement Program for new capital projects to meet
state seismic safety deadlines for which plans have been
submitted to the state after January 1, 2007 and before
December 31, 2011.
b) AB 523 (Huffman) permits the Marin Healthcare District
to request a two year extension of the seismic deadlines
from OSHPD to allow the hospital to undertake necessary
reviews and submit new design plans for retrofitting their
hospital.
c) SB 306 (Ducheny), Chapter 642, Statutes of 2008, amends
the Act to permit hospitals to delay compliance with the
July 1, 2008 seismic retro deadline, and the 2013
extension, to the year 2020, by filing a declaration with
OSHPD that the owner lacks financial capacity to comply
with the law.
d) SB 1661 (Cox), Chapter 693, Statutes of 2006, authorizes
an extension of up to an additional two years for hospitals
that have already received extensions of the January 1,
2008 seismic safety compliance deadline if specified
criteria are met, and requires specified hospital reports
to be posted on the Web site of OSHPD.
e) SB 167 (Speier), of 2005, would have amended the Act to
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permit delays of the 2008 seismic safety deadline for
specified hospitals that do not exceed maximum allowable
seismic risk, as determined by OSHPD, and expedited the
final compliance deadline to 2020 for hospitals granted the
delay. SB 167 failed passage in the Assembly Health
Committee.
f) AB 1978 (Walters), of 2005, would have extended, from
January 1, 2008 to January 1, 2015, the deadline for any
general acute care hospital building determined to be a
potential risk of collapse or pose significant loss of life
to only be used for nonacute care purposes, and permitted
hospitals subject to the 2015 deadline to request
additional extensions to 2020, as specified. AB 1978
failed passage in the Assembly Health Committee.
g) AB 1673 (Nation and Richman), of 2005, would have
repealed provisions of the Act that require specified
hospitals to meet seismic retrofitting requirements by
2008, revised the final 2030 deadline requirement to 2020,
and made the bill contingent upon the enactment of AB 1672
(Nation) relating to electronic medical recordkeeping. AB
1673 failed passage in the Assembly Health Committee.
h) SB 1953 (Alquist), Chapter 740, Statutes of 1994,
requires every hospital building to comply with two
deadlines. By January 1, 2008 (or no later than January 1,
2013, if an extension has been granted), every hospital
building must meet specific construction standards
established to keep these structures standing after a major
earthquake. By January 1, 2030, the law requires all
hospital buildings to comply with standards intended to
keep these buildings operational following a severe quake.
6)POLICY QUESTION. In 2006, the Legislature authorized
extensions of seismic safety requirements through passage of
SB 306 (Ducheney). SB 306 authorized seismic extensions if a
hospital lacked financial capacity or agreed to meet higher
future standards. This criteria was the result of an extended
debate and considered discussion. The hospital affected by
this bill, Tri-City, applied for an extension under SB 306 and
was denied. The community served by Tri-City has repeatedly
rejected authorization of bonds necessary to meet the seismic
obligation of the hospital. Is it appropriate for the
Legislature to make this exception contrary to established
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criteria given the unwillingness of the local community to
support the costs of the facility's compliance?
REGISTERED SUPPORT / OPPOSITION :
Support
Association of California Healthcare Districts
Opposition
Service Employees International Union
California Nurses Association
Analysis Prepared by : John D. Miller / HEALTH / (916)
319-2097