BILL NUMBER: AB 1201	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 28, 2009

INTRODUCED BY   Assembly Member V. Manuel Perez
    (   Coauthors:   Assembly Members 
 Fuentes,   Portantino,   and Salas  
) 

                        FEBRUARY 27, 2009

   An act to amend Section 1367.36 of the Health and Safety Code, and
to add Sections 10123.56 and 12693.56 to the Insurance Code,
relating to health care coverage.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1201, as amended, V. Manuel Perez. Immunizations for children:
reimbursement of physicians.
   Existing law, the Knox-Keene Health Care Service Plan Act of 1975,
provides for the licensure and regulation of health care service
plans by the Department of Managed Health Care and makes a willful
violation of that act a crime. Existing law also provides for the
regulation of health insurers by the Department of Insurance.
Existing law requires every health care service plan or health
insurer that covers hospital, medical, or surgical expenses on a
group basis to provide certain  preventative  
preventive  health care benefits for children, including
immunizations. Existing law specifies the reimbursement rate with
respect to immunizations that are not part of the current contract
between a health care service plan or physician group.
   This bill would require a health care service plan or health
insurer that provides coverage for childhood and adolescent
immunizations to reimburse a physician or physician group in an
amount not less than the actual cost of acquiring the vaccine plus
the cost of administration of the vaccine, as specified. The bill
would prohibit a health care service plan contract or health
insurance policy providing coverage for childhood or adolescent
immunizations from imposing a deductible, copayment, coinsurance, or
other cost-sharing mechanism for the administration of a childhood or
adolescent immunization or for related procedures. The bill would
also prohibit those contracts or policies from containing a dollar
limit provision for the administration of childhood and adolescent
immunizations or including the cost of those immunizations in a
dollar limit provision.
   Existing law prohibits a risk-based contract between a health care
service plan and a physician or physician group from including a
provision requiring the physician or physician group to assume
financial risk for the acquisition costs of required immunizations
for children. Existing law prohibits a plan from requiring a
physician or physician group to assume financial risk for
immunizations that are not part of the current contract.
   This bill would make those provisions apply to all contracts
between plans and physicians or physician groups rather than just
risk-based contracts. The bill would prohibit a plan from requiring a
physician or physician group to assume financial risk for
immunizations, whether or not those immunizations are part of the
current contract. The bill would make other related changes.
   Existing law prohibits a health care service plan from including
the acquisition costs associated with required immunizations for
children in the capitation rate of a physician who is individually
captitated.
   This bill would additionally prohibit a plan from including in
that capitation rate the administration costs of those immunizations.

   Because a willful violation of the bill's requirements relative to
health care service plans would be a crime, the bill would impose a
state-mandated local program.
   Existing law creates the Healthy Families Program, administered by
the Managed Risk Medical Insurance Board, to arrange for the
provision of health, dental, and vision benefits to eligible children
pursuant to a federal program, the State Children's Health Insurance
Program.
   This bill would require a health plan participating in that
program to reimburse a physician or physician group for immunizations
administered to program subscribers in an amount not less than the
actual cost of acquiring the vaccine plus the cost of administration
of the vaccine, as specified.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


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

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) Pediatric immunizations proved to be one of the most
successful, safe, and cost-effective public health interventions of
the 20th century. Worldwide, millions of childhood deaths are
prevented by vaccinations every year. Vaccine-preventable disease
levels are at or near record lows.
   (b) Vaccines are among the most cost-effective components of
preventive medical care. In 2003, the Centers for Disease Control
estimated a direct cost savings of six dollars and thirty cents
($6.30) for every dollar spent on vaccinations. If societal costs are
factored in, the savings increase to eighteen dollars and forty
cents ($18.40) per dollar spent.
   (c) Due to increasing numbers of approved and recommended
life-saving vaccines, as well as increasing prices, pediatric vaccine
acquisition costs have increased dramatically in recent years and
could triple by the year 2020.
   (d) Physicians typically face higher vaccine prices than large
public purchasers and usually lose money when they provide
immunizations due to under-reimbursement, which may discourage
physicians from purchasing adequate doses to meet the demand in their
practices. This trend could shift the burden of vaccine financing to
parents' out-of-pocket expenses or to local public health clinics or
other public programs.
   (e) As small businesses, physicians face severe financial strain
when they continue to absorb the unreimbursed costs associated with
vaccine acquisition and administration. The purchase of vaccines is
the single most expensive part of a pediatric or family practice.
When providers are not adequately reimbursed to cover the direct and
indirect costs of providing immunizations, the viability of their
practice is threatened.
   (f) Insured children and their families can face financial
barriers to immunization such as deductibles, copayments, and other
out-of-pocket expenses.
   (g) Unvaccinated children can contract a dangerous or
life-threatening disease at any time in their lives. In order to
effectively protect the public health, it is imperative that we
ensure continued access to disease-preventing vaccines in order to
achieve maximum immunization for infants, children, and adolescents.
   (h) Therefore, in order to maximize immunization rates to protect
individual children and the general population from existing and
emerging communicable diseases, it is the intent of the Legislature
to ensure that physicians are fully reimbursed for the costs to
acquire and administer recommended vaccines and that out-of-pocket
expenses do not deter parents from immunizing their children. 
   (i) The Legislature further recognizes the importance of the
California Immunization Registry in maximizing immunization rates and
supports and encourages physicians and their specialty societies in
efforts to increase physician participation in the registry. 
  SEC. 2.  Section 1367.36 of the Health and Safety Code is amended
to read:
   1367.36.  (a)  A contract between a health care service plan and a
physician or physician group that is issued, amended, delivered, or
renewed in this state on or after January 1, 2010, shall not include
a provision that requires a physician or a physician group to assume
financial risk for the acquisition costs of required immunizations
for children as a condition of accepting the contract. A physician or
physician group shall not be required to assume financial risk for
immunizations.
   (b) A health care service plan that provides coverage for
childhood and adolescent immunizations pursuant to Section 1367.3 or
1367.35 shall reimburse a physician or physician group in an amount
not less than the actual cost of acquiring the vaccine plus the cost
of administration of the vaccine. For purposes of this subdivision,
both of the following shall apply:
   (1) The actual cost of acquiring the vaccine includes, but is not
limited to, the invoiced purchase price plus reasonable costs
associated with shipping, handling, insurance, and storage.
   (2) The cost of administration of the vaccine shall be an amount
not less than that specified in the most current annual Medicare
physician fee schedule published pursuant to Section 1395w-4(b)(1) of
Title 42 of the United States Code.
   (c) Beginning January 1, 2010, with respect to immunizations for
children that are not part of the current contract between a health
care service plan and a physician or physician group, the health care
service plan shall reimburse a physician or physician group in an
amount not less than that specified in subdivision (b).
Reimbursements pursuant to this subdivision shall be made within 45
days of receipt by the plan of documents from the physician
demonstrating that the immunizations were performed, consistent with
Section 1371 or through an alternative funding mechanism mutually
agreed to by the health care service plan and the physician or
physician group. The alternative funding mechanism shall be based on
reimbursements consistent with this subdivision.
   (d) Physicians and physician groups may assume financial risk for
providing required immunizations, if the immunizations have
experiential data that has been negotiated and agreed upon by the
health care service plan and the physician or physician group.
However, a health care service plan shall not require a physician or
physician group to accept financial risk or impose additional risk on
a physician or physician group in violation of subdivision (a).
   (e) A health care service plan shall not include the acquisition
costs or administration costs associated with required immunizations
for children in the capitation rate of a physician who is
individually capitated.
   (f) A health care service plan contract issued, amended, or
renewed on or after January 1, 2010, that provides coverage for
childhood and adolescent immunizations pursuant to Section 1367.3 or
1367.35 shall not do either of the following:
   (1) Impose a deductible, copayment, coinsurance, or other
cost-sharing mechanism for the administration of a childhood or
adolescent immunization or for procedures related to that
administration.
   (2) Contain a dollar limit provision for the administration of
childhood and adolescent immunizations or include the cost of those
immunizations in a dollar limit provision of the contract.
  SEC. 3.  Section 10123.56 is added to the Insurance Code, to read:
   10123.56.  (a) A health insurer that provides coverage for
childhood and adolescent immunizations pursuant to Section 10123.5 or
10123.55 shall reimburse a physician or physician group in an amount
not less than the actual cost of acquiring the vaccine plus the cost
of administration of the vaccine. For purposes of this subdivision,
both of the following shall apply:
   (1) The actual cost of acquiring the vaccine includes, but is not
limited to, the invoiced purchase price plus reasonable costs
associated with shipping, handling, insurance, and storage.
   (2) The cost of administration of the vaccine shall be an amount
not less than that specified in the most current annual Medicare
physician fee schedule published pursuant to Section 1395w-4(b)(1) of
Title 42 of the United States Code.
   (b) A health insurance policy issued, amended, or renewed on or
after January 1, 2010, that provides coverage for childhood and
adolescent immunizations pursuant to Section 10123.5 or 10123.55
shall not do either of the following:
   (1) Impose a deductible, copayment, coinsurance, or other
cost-sharing mechanism for the administration of a childhood or
adolescent immunization or for procedures related to that
administration.
   (2) Contain a dollar limit provision for the administration of
childhood and adolescent immunizations or include the cost of those
immunizations in a dollar limit provision of the policy.
  SEC. 4.  Section 12693.56 is added to the Insurance Code, to read:
   12693.56.  A participating health plan shall reimburse a physician
or physician group for immunizations administered to a program
subscriber in an amount not less than the actual cost of acquiring
the vaccine plus the cost of administration of the vaccine. For
purposes of this section, both of the following shall apply:
   (a) The actual cost of acquiring the vaccine includes, but is not
limited to, the invoiced purchase price plus reasonable costs
associated with shipping, handling, insurance, and storage.
   (b) The cost of administration of the vaccine shall be an amount
not less than that specified in the most current annual Medicare
physician fee schedule published pursuant to Section 1395w-4(b)(1) of
Title 42 of the United States Code.
  SEC. 5.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.