BILL NUMBER: AB 648 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 28, 2009
AMENDED IN ASSEMBLY MAY 5, 2009
AMENDED IN ASSEMBLY APRIL 15, 2009
INTRODUCED BY Assembly Member Chesbro
( Principal coauthor: Assembly Member
Nielsen )
( Principal coauthor: Senator
Cox )
( Coauthor: Assembly Member
Buchanan Coauthors: Assembly
Members Buchanan, Fuentes, and
Miller )
(Coauthor: Senator Cox Ducheny )
FEBRUARY 25, 2009
An act to add and repeal Chapter 6.5 (commencing with Section
124871) of Part 4 of Division 106 of the Health and Safety Code,
relating to rural hospitals.
LEGISLATIVE COUNSEL'S DIGEST
AB 648, as amended, Chesbro. Rural hospitals: physician services.
Existing law generally provides for the licensure of health
facilities, including rural general acute care hospitals, by the
State Department of Public Health.
Existing law requires the department to provide expert technical
assistance to strategically located, high-risk rural hospitals, as
defined, to assist the hospitals in carrying out an assessment of
potential business and diversification of service opportunities.
Existing law also requires the department to continue to provide
regulatory relief when appropriate through program flexibility for
such items as staffing, space, and physical plant requirements.
This bill would, until January 1, 2020, establish a demonstration
project authorizing a rural hospital, as defined, that meets
specified conditions, to employ up to 10 physicians and surgeons at
one time, except as provided, to provide medical services at the
rural hospital or other health facility that the rural hospital owns
or operates, and to retain all or part of the income generated by the
physicians and surgeons for medical services billed and collected by
the rural hospital if the physician and surgeon in whose name the
charges are made approves the charges. The bill would require a rural
hospital that employs a physician and surgeon pursuant to those
provisions to develop and implement a policy regarding the
independent medical judgment of the physician and surgeon.
The bill would require these physicians and surgeons to biennially
sign a specified statement.
The bill would impose various duties on the department and the
Medical Board of California including, not later than January 1,
2019, a requirement that the board deliver a report to the
Legislature regarding the demonstration project.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) Many hospitals in the state are having great difficulty
recruiting and retaining physicians.
(b) There is a shortage of physicians in communities across
California, particularly in rural areas, and this shortage limits
access to health care for Californians in these communities.
(c) The average age of physicians in rural and underserved urban
communities is approaching 60 years of age, with many of these
physicians planning to retire within the next two years.
(c)
(d) Allowing rural hospitals to directly employ
physicians will allow rural hospitals to provide economic security
adequate for a physician to relocate and reside in the communities
served by the rural hospitals and will help rural hospitals recruit
physicians to provide medically necessary services in these
communities and further enhance technological developments such as
the adoption of electronic medical records.
(d)
(e) Allowing rural hospitals to directly employ
physicians will provide physicians with the opportunity to focus on
the delivery of health services to patients without the burden of
administrative, financial, and operational concerns associated with
the establishment and maintenance of a medical office, thereby giving
the physicians a reasonable professional and personal lifestyle.
(e)
(f) It is the intent of the Legislature by enacting
this act to establish a demonstration project authorizing a rural
hospital that meets the conditions set forth in Chapter 6.5
(commencing with Section 124871) of the Health and Safety Code to
employ physicians directly and to charge for their professional
services.
(f)
(g) It is the further intent of the Legislature to
prevent a rural hospital that employs a physician from interfering
with, controlling, or otherwise directing the physician's medical
judgment or medical treatment of patients.
SEC. 2. Chapter 6.5 (commencing with Section 124871) is added to
Part 4 of Division 106 of the Health and Safety Code, to read:
CHAPTER 6.5. RURAL HOSPITAL PHYSICIAN AND SURGEON SERVICES
DEMONSTRATION PROJECT
124871. For purposes of this chapter, a rural hospital means all
of the following:
(a) A general acute care hospital located in an area designated as
nonurban by the United States Census Bureau.
(b) A general acute care hospital located in a rural-urban
commuting area code of 4 or greater as designated by the United
States Department of Agriculture.
(c) A rural general acute care hospital, as defined in subdivision
(a) of Section 1250.
124872. (a) Notwithstanding Article 18 (commencing with Section
2400) of Chapter 5 of Division 2 of the Business and Professions Code
and in addition to other applicable laws, a rural hospital whose
service area includes a medically underserved area, a medically
underserved population, or that has been federally designated as a
health professional shortage area may employ one or more physicians
and surgeons, not to exceed 10 physicians and surgeons at one time,
except as provided in subdivision (c), to provide medical services at
the rural hospital or other health facility, as defined in Section
1250, that the rural hospital owns or operates. The rural hospital
may retain all or part of the income generated by the physician and
surgeon for medical services billed and collected by the rural
hospital, if the physician and surgeon in whose name the charges are
made approves the charges.
(b) A rural hospital may participate in the program if both of the
following conditions are met:
(1) The rural hospital can document that it has been unsuccessful
in recruiting one or more primary care or speciality physicians for
at least 12 continuous months beginning July 1, 2008.
(2) The chief executive officer of the rural hospital certifies to
the Medical Board of California that the inability to recruit
primary care or speciality physicians has negatively impacted patient
care in the community and that there is a critical unmet need in the
community, based on a number of factors, including, but not limited
to, the number of patients referred for care outside the community,
the number of patients who experienced delays in treatment, and the
length of the treatment delays.
(c) The total number of licensees employed by the rural hospital
at one time shall not exceed 10, unless the employment of additional
physicians and surgeons is deemed appropriate by the Medical Board of
California on a case-by-case basis. In making this determination the
board shall take into consideration whether access to care is
improved for the community served by the hospital by increasing the
number of physicians and surgeons employed.
124873. (a) A rural hospital that employs a physician and surgeon
pursuant to Section 124872 shall develop and implement a written
policy to ensure that each employed physician and surgeon exercises
his or her independent medical judgment in providing care to
patients.
(b) Each physician and surgeon employed by a rural hospital
pursuant to Section 124872 shall sign a statement biennially
indicating that the physician and surgeon:
(1) Voluntarily desires to be employed by the hospital.
(2) Will exercise independent medical judgment in all matters
relating to the provision of medical care to his or her patients.
(3) Will report immediately to the Medical Board of California any
action or event that the physician and surgeon reasonably and in
good faith believes constitutes a compromise of his or her
independent medical judgment in providing care to patients in a rural
hospital or other health care facility owned or operated by the
rural hospital.
(c) The signed statement required by subdivision (b) shall be
retained by the rural hospital for a period of at least three years.
A copy of the signed statement shall be submitted by the rural
hospital to the Medical Board of California within 10 working days
after the statement is signed by the physician and surgeon.
(d) A rural hospital shall not interfere with, control, or direct
a physician's and surgeon's exercise of his or her independent
medical judgment in providing medical care to patients. If, pursuant
to a report to the Medical Board of California required by paragraph
(3) of subdivision (a), the Medical Board of California believes that
a rural hospital has violated this prohibition, the Medical Board of
California shall refer the matter to the State Department of Public
Health, which shall investigate the matter. If the department
concludes that the rural hospital has violated the prohibition, it
shall notify the rural hospital. The rural hospital shall have 20
working days to respond in writing to the department's notification,
following which the department shall make a final determination. If
the department finds that the rural hospital violated the
prohibition, it shall assess a civil penalty of five thousand dollars
($5,000) for the first violation and twenty-five thousand dollars
($25,000) for any subsequent violation that occurs within three years
of the first violation. If no subsequent violation occurs within
three years of the most recent violation, the next civil penalty, if
any, shall be assessed at the five thousand dollar ($5,000) level. If
the rural hospital disputes a determination by the department
regarding a violation of the prohibition, the rural hospital may
request a hearing pursuant to Section 131071. Penalties, if any,
shall be paid when all appeals have been exhausted and the department'
s position has been upheld.
(e) Nothing in this chapter shall exempt a rural hospital from a
reporting requirement or affect the authority of the board to take
action against a physician's and surgeon's license.
124874. (a) Not later than January 1, 2019, the board shall
deliver a report to the Legislature regarding the demonstration
project established pursuant to this chapter. The report shall
include an evaluation of the effectiveness of the demonstration
project in improving access to health care in rural and medically
underserved areas and the demonstration project's impact on consumer
protection as it relates to intrusions into the practice of medicine.
(b) This chapter shall remain in effect only until January 1,
2020, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2020, deletes or extends
that date.