BILL ANALYSIS
AB 511
Page 1
Date of Hearing: May 20, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 511 (De La Torre) - As Amended: May 4, 2009
Policy Committee: Health Vote:19-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill establishes a 5.5% quality assurance fee (QAF) on
ambulance transportation services providers until 2015-16 to
increase transportation rates paid on behalf of Medi-Cal
patients. Specifically, this bill:
1)Requires revenue from the QAF to be used exclusively to
enhance federal financial participation (FFP) under Medi-Cal
or to support quality improvement efforts.
2)Implements this bill only if the state receives federal
approval and legislation is enacted during the 2009-10
legislative session that makes an appropriation to fund a
Medi-Cal rate increase for ambulance transportation services
providers.
3)Requires the California Department of Health Care Services
(DHCS) to attain federal approval, promulgate regulations,
issue guidance via provider bulletins and continue oversight
of payment and administration of the Medi-Cal program.
FISCAL EFFECT
1)Annual increased Medi-Cal payments to ambulance providers of
$100 million (50% provider QAF/50% federal) to $110 million
(50% provider QAF/50% federal). These figures are based on
preliminary estimates of 5.5% of statewide aggregate ambulance
revenues and are supported by research regarding average
reimbursement by payer type, distribution of patient transport
by payer type and frequency, and related current law
reimbursements.
2)Staffing costs to DHCS of $200,000 (50% GF) to implement the
requirements of this bill, including attaining federal
approval and establishing claims processing to track QAF
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revenues and compliance with provider payment requirements.
COMMENTS
1)Rationale . This bill is sponsored by American Medical Response
(AMR), the largest Medi-Cal ambulance provider in California.
According to the author, sponsor, and other transportation
providers, Medi-Cal reimbursements are approximately one-third
of provider costs. Maximum Medi-Cal base reimbursement ranges
from $118 to $128. Providers indicate actual costs are more
than $500. Low reimbursement rates, combined with escalating
costs, have created significant pressures on the providers
provided relief in this bill. Pressures cited are: (a) wages
and benefits have increased 65% (b) insurance costs have
increased 40%, and (c) equipment costs have increased 32% over
the past decade.
2)Medi-Cal Quality Assurance Fees . Federal law authorizes states
to fund a portion of Medicaid through provider fees that meet
federal requirements and are matched with FFP to pay providers
without state funds. State QAF must be broad-based, uniform,
and cannot hold a group of providers harmless with respect to
fees levied. California currently has several QAF established
via budget committee action and legislation. These QAF
generate revenues for Medi-Cal managed care plans, skilled
nursing facilities (SNF, nursing homes), and intermediate care
facilities for the developmentally disabled (ICF-DD).
Combined, these QAF generate an additional $450 million per
year for these programs.
3)Transport Mandate Under EMTALA . Ambulance providers, unlike
many other Medi-Cal providers, are mandated to care for those
who require services. Providers such as physicians, dentists,
and surgeons may simply reject Medi-Cal patients. Ambulance
providers cannot. The Emergency Medical Treatment and Active
Labor Act (EMTALA), enacted in 1986, prohibits the practice of
patient dumping, treatment denial, and patient discharge based
on anticipated high emergency treatment costs. The mandate to
treat psychiatric and other emergency medical needs is
included in EMTALA transport and treatment mandates. Hospitals
are required to provide appropriate screening examinations to
determine whether emergency medical conditions exist,
regardless of patients' ability to pay. When emergency medical
needs are identified, EMTALA requires hospitals to stabilize
patients.
4)Medi-Cal Lowest California Emergency Medical Transport Payer .
Analysis of California-specific ambulance data and recently
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published information from the federal General Accountability
Office establishes the following comparison of payers in
California. Medi-Cal is the lowest of all payment types, even
lower than patients paying out-of-pocket.
Annual California Ambulance Patient Transport and Reimbursement
-----------------------------------------------
|Payment |# of |% of |Reimbursemen|
|Source |transports|transports |t |
| | | | |
|-----------+----------+-----------+------------|
|Medicare | 379,000 | 35% | $ 521 |
|-----------+----------+-----------+------------|
|Medi-Cal | 279,214 | 21% | $ 118 |
|-----------+----------+-----------+------------|
|Facility | 89,000 | 8% | $ 723 |
|-----------+----------+-----------+------------|
|Self-Pay | 194,000 | 18% | $ 201 |
|-----------+----------+-----------+------------|
|Other | 192,000 | 18% |$1,100 |
|insurers | | | |
|-----------+----------+-----------+------------|
|Other | 2,000 | < 1% |$ |
| | | |220 |
-----------------------------------------------
5)Related Legislation . AB 1174 (Hernandez), pending on the
Suspense File of this committee, significantly increases
Medi-Cal ambulance rates, increasing costs by approximately
$120 million (50% GF/50% FFP). Although AB 1174 and AB 511 are
not linked, the revenues generated in AB 511 could be used to
support the rate increases established in AB 1174.
AB 1153 (Beall), pending on the Suspense File of this committee,
levies an additional $3 penalty on specified fines, penalties
and forfeitures to support the Emergency Air Medical
Transportation Act to support Medi-Cal transportation
services.
AB 1383 (Jones), also being heard in this committee today,
establishes a QAF on hospitals statewide to provide a Medi-Cal
rate increase and to expand children's health care coverage.
AB 1383 is estimated to raise Medi-Cal rates $2 billion (50%
hospital fee/50%FFP) to $4 billion (50% hospital fee/50% FFP)
after being matched with FFP.
Analysis Prepared by : Mary Ader / APPR. / (916) 319-2081