BILL NUMBER: AB 1540 AMENDED
BILL TEXT
AMENDED IN SENATE JULY 23, 2009
AMENDED IN SENATE JULY 2, 2009
AMENDED IN SENATE JUNE 24, 2009
AMENDED IN SENATE JUNE 18, 2009
AMENDED IN SENATE JUNE 16, 2009
AMENDED IN ASSEMBLY MAY 5, 2009
AMENDED IN ASSEMBLY APRIL 16, 2009
INTRODUCED BY Committee on Health (Jones (Chair), Adams, Ammiano,
Block, Carter, De La Torre, Hall, Hayashi, Hernandez, Bonnie
Lowenthal, Nava, V. Manuel Perez, and Salas)
MARCH 4, 2009
An act to amend Section 6276.24 of the Government Code, to amend
Sections 1344, 1366.4, 1374.64, 1375.4, 1376.1, 1377, 1399, 116283,
116286, 116380, 116450, 116540, 116650, 116725, 121360.5,
127662, 127664, 127665, 128730, and 128745 of , and to add
Section 116552 to, the Health and Safety Code, and to amend
Sections 14043.26, 14043.28, 14043.29, and 14115.8 of the Welfare and
Institutions Code, relating to health.
LEGISLATIVE COUNSEL'S DIGEST
AB 1540, as amended, Committee on Health. Health.
(1) Existing law, the California Public Records Act, requires
certain public records to be made available for public inspection.
Existing law, the Health Data and Advisory Council Consolidation
Act, requires every organization that operates, conducts, or
maintains a health facility to make and file with the Office of
Statewide Health Planning and Development, specified reports
containing various financial and patient data. Existing law requires
the office to publish risk-adjusted outcome reports for coronary
artery bypass graft surgeries, as specified.
This bill would provide, with respect to the above provisions,
that patient medical record numbers and any other data elements that
the office believes could be used to determine the identity of an
individual patient shall be exempt from the disclosure requirements
of the California Public Records Act.
(2) 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. Existing law
provides for the regulation of health insurers by the Department of
Insurance. The Knox-Keene Health Care Service Plan Act of 1975
authorizes the director of the department to adopt, amend, and
rescind any rules necessary to carry out the act and requires health
care service plans to provide certain notices.
This bill would authorize the director to, by regulation, modify
the wording of any notice required by the act for purposes of
clarity, readability, and accuracy.
The bill would make other technical, nonsubstantive changes to
related provisions governing health care service plans.
(3) Existing law, known as the California Safe Drinking Water Act,
requires the State Department of Public Health to administer
provisions relating to the regulation of drinking water to protect
public health.
Existing law requires the department to adopt regulations it
determines to be necessary to carry out the purposes of the
California Safe Drinking Water Act. Existing law requires regulations
adopted by the department to include requirements governing the use
of point-of-entry treatment by public water systems in lieu of
centralized treatment, as specified.
This bill would require regulations adopted by the department to
include requirements governing the use of point-of-entry and
point-of-use treatment by public water systems in lieu of centralized
treatment, as specified. The bill would also prohibit the
department from issuing or amending a permit to allow the use of
point-of-use treatment unless the department determines, after a
public hearing, that there is no substantial community opposition. It
would also limit the issuance of that permit to the lesser of 3
years or until funding for centralized treatment is available.
(4) Under existing law, when a primary drinking water standard is
not complied with, when a monitoring requirement is not performed, or
when a water purveyor fails to comply with the conditions of a
variance or exception, a public water system is required to notify
the department and users, as specified.
This bill would, if user notification is required pursuant to this
provision, require the department to make a reasonable effort to
ensure that notification is given.
(4)
(5) Existing law provides that the department may issue
a citation to a public water system that violates the California
Safe Drinking Water Act. Existing law provides that for noncontinuing
violations of primary drinking standards, other than turbidity, the
department may assess a civil penalty in the citation, as specified.
This bill would delete the exemption for turbidity.
This bill would make other technical, nonsubstantive changes to
related provisions governing the issuance of citations for violations
of the California Safe Drinking Water Act.
(5)
(6) Existing law provides for the Medi-Cal program,
which is administered by the State Department of Health Care Services
and under which qualified low-income persons receive health care
benefits. Existing law requires that health care providers apply to,
and be certified by, the department prior to their participation in
the Medi-Cal program.
Existing law allows the department to grant provisional provider
status or preferred provisional provider status to an applicant or
provider, and requires the department to terminate that status if any
specified grounds exist.
This bill would correct obsolete references in the above
provisions.
(6)
(7) Under existing law, the Medi-Cal program is
partially governed and funded as part of the federal Medicaid
Program. Existing law requires the department to amend the Medicaid
state plan with respect to the billing option for services by local
education agencies to ensure that schools are reimbursed for all
eligible services that they provide that are not precluded by federal
requirements. Existing law would repeal these provisions on January
1, 2010.
This bill would change the repeal date to January 1, 2013.
(7)
(8) Existing law establishes the Local Education Agency
Medi-Cal Recovery Account in the Special Deposit Fund, to be used
only to support the department in meeting the requirements of the
above provisions, and specifies a formula for funding and staffing
activities provided for under these provisions.
Existing law provides that as of January 1, 2010, unless the
Legislature enacts a new statute or extends the date beyond January
1, 2010, all funds in the Local Education Agency Medi-Cal Recovery
Account shall be returned proportionately to all local education
agencies whose federal Medicaid funds were used to create the
account.
This bill would rename the account the Local Educational Agency
Medi-Cal Recovery Fund.
This bill would also provide that, as of January 1, 2013, unless
the Legislature enacts a new statute or extends the repeal date, all
funds in the Local Educational Agency Medi-Cal Recovery Fund shall be
returned proportionally to all local educational agencies whose
federal Medicaid funds were used to create the fund.
(8)
(9) Existing law, until January 1, 2011, requests the
University of California to establish the California Health Benefit
Review Program to assess legislation proposing a mandated health
benefit or service, as defined, to be provided by health care service
plans and health insurers, and to prepare a written analysis in
accordance with specified criteria.
This bill would extend the repeal date of the above provisions to
June 30, 2015.
(9)
(10) Existing law requests the University of California
to submit a report to the Governor and the Legislature no later than
January 1, 2010, regarding the implementation of the above
provisions.
This bill would, instead, request the University of California to
submit a report no later than January 1, 2014.
(10)
(11) Existing law, for fiscal years 2006-07 to 2009-10,
inclusive, provides funding for the University of California's
implementation of the above provisions from a fee imposed upon health
care service plans and health insurers, which would not exceed a
total of $2,000,000, and is to be deposited in the Health Care
Benefits Fund.
This bill, instead, provides for the imposition of that fee for
fiscal years 2010-11 to 2014-15, inclusive.
(11)
(12) Existing law requires the State Department of
Public Health to maintain a program for the control of tuberculosis.
Existing law, until January 1, 2011, requires a local health
department that elects to participate in the program to provide for
certification for one year, by the local health officer, of
tuberculin skin test technicians.
This bill would delete the repeal date of these provisions,
thereby extending the operation of these provisions indefinitely.
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. Section 6276.24 of the Government Code is amended to
read:
6276.24. Harmful matter, distribution, confidentiality of certain
recipients, Section 313.1, Penal Code.
Hazardous substance tax information, prohibition against
disclosure, Section 43651, Revenue and Taxation Code.
Hazardous waste control, business plans, public inspection,
Section 25506, Health and Safety Code.
Hazardous waste control, notice of unlawful hazardous waste
disposal, Section 25180.5, Health and Safety Code.
Hazardous waste control, trade secrets, disclosure of information,
Sections 25511 and 25538, Health and Safety Code.
Hazardous waste control, trade secrets, procedures for release of
information, Section 25358.2, Health and Safety Code.
Hazardous waste generator report, protection of trade secrets,
Sections 25244.21 and 25244.23, Health and Safety Code.
Hazardous waste licenseholder disclosure statement,
confidentiality of, Section 25186.5, Health and Safety Code.
Hazardous waste management facilities on Indian lands,
confidentiality of privileged or trade secret information, Section
25198.4, Health and Safety Code.
Hazardous waste recycling, duties of department, Section 25170,
Health and Safety Code.
Hazardous waste recycling, list of specified hazardous wastes,
trade secrets, Section 25175, Health and Safety Code.
Hazardous waste recycling, trade secrets, confidential nature,
Sections 25173 and 25180.5, Health and Safety Code.
Healing arts licensees, central files, confidentiality, Section
800, Business and Professions Code.
Health authorities, special county, protection of trade secrets,
Sections 14087.35, 14087.36, and 14087.38, Welfare and Institutions
Code.
Health Care Provider Central Files, confidentiality of, Section
800, Business and Professions Code.
Health care provider disciplinary proceeding, confidentiality of
documents, Section 805.1, Business and Professions Code.
Health care service plans, review of quality of care, privileged
communications, Sections 1370 and 1380, Health and Safety Code.
Health commissions, special county, protection of trade secrets,
Section 14087.31, Welfare and Institutions Code.
Health facilities, patient's rights of confidentiality,
subdivision (c) of Section 128745 and Sections 128735, 128736,
128737, 128755, and 128765, Health and Safety Code.
Health facility and clinic, consolidated data and reports,
confidentiality of, Section 128730, Health and Safety Code.
Health personnel, data collection by the Office of Statewide
Health Planning and Development, confidentiality of information on
individual licentiates, Sections 127775 and 127780, Health and Safety
Code.
Health planning and development pilot projects, confidentiality of
data collected, Section 128165, Health and Safety Code.
Hereditary Disorders Act, legislative finding and declaration,
confidential information, Sections 124975 and 124980, Health and
Safety Code.
Hereditary Disorders Act, rules, regulations, and standards,
breach of confidentiality, Section 124980, Health and Safety Code.
Higher Education Employee-Employer Relations, findings of fact and
recommended terms of settlement, Section 3593, Government Code.
Higher Education Employee-Employer Relations, access by Public
Employment Relations Board to employer's or employee organization's
records, Section 3563, Government Code.
HIV, disclosures to blood banks by department or county health
officers, Section 1603.1, Health and Safety Code.
Home address of public employees and officers in Department of
Motor Vehicles, records, confidentiality of, Sections 1808.2 and
1808.4, Vehicle Code.
Horse racing, horses, blood or urine test sample, confidentiality,
Section 19577, Business and Professions Code.
Hospital district and municipal hospital records relating to
contracts with insurers and service plans, subdivision (t), Section
6254, Government Code.
Hospital final accreditation report, subdivision (s), Section
6254, Government Code.
Housing authorities, confidentiality of rosters of tenants,
Section 34283, Health and Safety Code.
Housing authorities, confidentiality of applications by
prospective or current tenants, Section 34332, Health and Safety
Code.
SEC. 2. Section 1344 of the Health and Safety Code is amended to
read:
1344. (a) The director may from time to time adopt, amend, and
rescind any rules, forms, and orders that are necessary to carry out
the provisions of this chapter, including rules governing
applications and reports, and defining any terms, whether or not used
in this chapter, insofar as the definitions are not inconsistent
with the provisions of this chapter. For the purpose of rules and
forms, the director may classify persons and matters within the
director's jurisdiction, and may prescribe different requirements for
different classes. The director may waive any requirement of any
rule or form in situations where in the director's discretion that
requirement is not necessary in the public interest or for the
protection of the public, subscribers, enrollees, or persons or plans
subject to this chapter. The director may adopt rules consistent
with federal regulations and statutes to regulate health care
coverage supplementing Medicare.
(b) The director may, by regulation, modify the wording of any
notice required by this chapter for purposes of clarity, readability,
and accuracy, except that a modification shall not change the
substantive meaning of the notice.
(c) The director may honor requests from interested parties for
interpretive opinions.
(d) No provision of this chapter imposing any liability applies to
any act done or omitted in good faith in conformity with any rule,
form, order, or written interpretive opinion of the director, or any
opinion of the Attorney General, notwithstanding that the rule, form,
order, or written interpretive opinion may later be amended or
rescinded or be determined by judicial or other authority to be
invalid for any reason.
SEC. 3. Section 1366.4 of the Health and Safety Code is amended to
read:
1366.4. (a) A medical group, physician, or independent practice
association that contracts with a health care service plan may enter
into contracts with licensed nonphysician providers to provide
services, as defined in Section 1300.67(a)(1) of Title 28 of the
California Code of Regulations, to plan enrollees covered by the
contract between the plan and the group, physician, or association.
(b) The licensed nonphysician provider described in subdivision
(a) that contracts with a medical group, physician, or independent
practice association may directly bill, if direct billing is
otherwise permitted by law, a health care service plan for covered
services pursuant to a contract with the health care service plan
that specifies direct billing. Direct billing pursuant to this
subdivision is permitted only to the extent that the same services
are not billed for by the medical group, physician, or independent
practice association.
(c) A health care service plan may require the nonphysician
provider to complete an appropriate credentialing process.
(d) Every health care service plan may either list licensed
nonphysician providers that contract with medical groups, physicians,
and independent practice associations pursuant to subdivision (b) in
any listing or directory of plan health care providers that is
provided to enrollees or to the public, or may include a notification
in the plan's evidence of coverage or provider list that the health
care service plan has contracts with nonphysician providers, pursuant
to subdivision (b), and may list the types of contracted
nonphysician providers. The notification may inform an enrollee that
he or she may obtain a list of the nonphysician providers by
contacting his or her primary or specialist medical group. The
listing may indicate whether licensed nonphysician providers may be
accessed directly by enrollees.
(e) Nothing in this section shall be construed to authorize, or
otherwise require the director to approve, a risk-sharing arrangement
between a plan and a provider.
SEC. 4. Section 1374.64 of the Health and Safety Code is amended
to read:
1374.64. (a) Only a plan that has been licensed under this
chapter and in operation in this state for a period of five years or
more, or a plan licensed under this chapter and operating in this
state for a period of five or more years under a combination of (1)
licensure under this chapter and (2) pursuant to a certificate of
authority issued by the Department of Insurance may offer a
point-of-service contract. A specialized health care service plan
shall not offer a point-of-service plan contract unless this plan was
formerly registered under the Knox-Mills Health Plan Act (Article
2.5 (commencing with Section 12530) of Chapter 6 of Part 2 of
Division 3 of Title 2 of the Government Code), as repealed by Chapter
941 of the Statutes of 1975, and offered point-of-service plan
contracts previously approved by the director on July 1, 1976, and on
September 1, 1993.
(b) A plan may offer a point-of-service plan contract only if the
director has not found the plan to be in violation of any
requirements, including administrative capacity, under this chapter
or the rules adopted thereunder and the plan meets, at a minimum, the
following financial criteria:
(1) The minimum financial criteria for a plan that maintains a
minimum net worth of at least five million dollars ($5,000,000) shall
be:
(A) (i) Initial tangible net equity so that the plan is not
required to file monthly reports with the director as required by
Section 1300.84.3(d)(1)(G) of Title 28 of the California Code of
Regulations and then have and maintain adjusted tangible net equity
to be determined pursuant to either of the following:
(I) In the case of a plan that is required to have and maintain a
tangible net equity as required by Section 1300.76(a)(1) or (2) of
Title 28 of the California Code of Regulations, multiply 130 percent
times the sum resulting from the addition of the plan's tangible net
equity required by Section 1300.76(a)(1) or (2) of Title 28 of the
California Code of Regulations and the number that equals 10 percent
of the plan's annualized health care expenditures for out-of-network
services for point-of-service enrollees.
(II) In the case of a plan that is required to have and maintain a
tangible net equity as required by Section 1300.76(a)(3) of Title 28
of the California Code of Regulations, recalculate the plan's
tangible net equity under Section 1300.76(a)(3) of Title 28 of the
California Code of Regulations excluding the plan's annualized health
care expenditures for out-of-network services for point-of-service
enrollees, add together the number resulting from this recalculation
and the number that equals 10 percent of the plan's annualized health
care expenditures for out-of-network services for point of services
enrollees, and multiply this sum times 130 percent, provided that the
product of this multiplication must exceed 130 percent of the
tangible net equity required by Section 1300.76(a)(3) of Title 28 of
the California Code of Regulations so that the plan is not required
to file monthly reports to the director as required by Section
1300.84.3(d)(1)(G) of Title 28 of the California Code of Regulations.
(ii) The failure of a plan offering a point-of-service plan
contract under this article to maintain adjusted tangible net equity
as determined by this subdivision shall require the filing of monthly
reports with the director pursuant to Section 1300.84.3(d) of Title
28 of the California Code of Regulations, in addition to any other
requirements that may be imposed by the director on a plan under this
article and chapter.
(iii) The calculation of tangible net equity under any report to
be filed by a plan offering a point-of-service plan contract under
this article and required of a plan pursuant to Section 1384, and the
regulations adopted thereunder, shall be on the basis of adjusted
tangible net equity as determined under this subdivision.
(B) Demonstrates adequate working capital, including (i) a current
ratio (current assets divided by current liabilities) of at least
1:1, after excluding obligations of officers, directors, owners, or
affiliates, or (ii) evidence that the plan is now meeting its
obligations on a timely basis and has been doing so for at least the
preceding two years. Short-term obligations of affiliates for goods
or services arising in the normal course of business that are payable
on the same terms as equivalent transactions with nonaffiliates
shall not be excluded. For purposes of this subdivision, an
obligation is considered short term if the repayment schedule is 30
days or fewer.
(C) Demonstrates a trend of positive earnings over the previous
eight fiscal quarters.
(2) The minimum financial criteria for a plan that maintains a
minimum net worth of at least one million five hundred thousand
dollars ($1,500,000) but less than five million dollars ($5,000,000)
shall be:
(A) (i) Initial tangible net equity so that the plan is not
required to file monthly reports with the director as required by
Section 1300.84.3(d)(1)(G) of Title 28 of the California Code of
Regulations and then have and maintain adjusted tangible net equity
to be determined pursuant to either of the following:
(I) In the case of a plan that is required to have and maintain a
tangible net equity as required by Section 1300.76(a)(1) or (2) of
Title 28 of the California Code of Regulations, multiply 130 percent
times the sum resulting from the addition of the plan's tangible net
equity required by Section 1300.76(a)(1) or (2) of Title 28 of the
California Code of Regulations and the number that equals 10 percent
of the plan's annualized health care expenditures for out-of-network
services for point-of-service enrollees.
(II) In the case of a plan that is required to have and maintain a
tangible net equity as required by Section 1300.76(a)(3) of Title 28
of the California Code of Regulations, recalculate the plan's
tangible net equity under Section 1300.76(a)(3) excluding the plan's
annualized health care expenditures for out-of-network services for
point-of-service enrollees, add together the number resulting from
this recalculation and the number that equals 10 percent of the plan'
s annualized health care expenditures for out-of-network services for
point-of-services enrollees, and multiply this sum times 130
percent, provided that the product of this multiplication must exceed
130 percent of the tangible net equity required by Section 1300.76
(a)(3) of Title 28 of the California Code of Regulations so that the
plan is not required to file monthly reports to the director as
required by Section 1300.84.3(d)(1)(G) of Title 28 of the California
Code of Regulations.
(ii) The failure of a plan offering a point-of-service plan
contract under this article to maintain adjusted tangible net equity
as determined by this subdivision shall require the filing of monthly
reports with the director pursuant to Section 1300.84.3(d) of Title
28 of the California Code of Regulations, in addition to any other
requirements that may be imposed by the director on a plan under this
article and chapter.
(iii) The calculation of tangible net equity under any report to
be filed by a plan offering a point-of-service plan contract under
this article and required of a plan pursuant to Section 1384, and the
regulations adopted thereunder, shall be on the basis of adjusted
tangible net equity as determined under this subdivision.
(B) Demonstrates adequate working capital, including (i) a current
ratio (current assets divided by current liabilities) of at least
1:1, after excluding obligations of officers, directors, owners, or
affiliates or (ii) evidence that the plan is now meeting its
obligations on a timely basis and has been doing so for at least the
preceding two years. Short-term obligations of affiliates for goods
or services arising in the normal course of business that are payable
on the same terms as equivalent transactions with nonaffiliates
shall not be excluded. For purposes of this subdivision, an
obligation is considered short term if the repayment schedule is 30
days or fewer.
(C) Demonstrates a trend of positive earnings over the previous
eight fiscal quarters.
(D) Demonstrates to the director that it has obtained insurance
for the cost of providing any point-of-service enrollee with
out-of-network covered health care services, the aggregate value of
which exceeds five thousand dollars ($5,000) in any year. This
insurance shall obligate the insurer to continue to provide care for
the period in which a premium was paid in the event a plan becomes
insolvent. Where a plan cannot obtain insurance as required by this
subparagraph, then a plan may demonstrate to the director that it has
made other arrangements, acceptable to the director, for the cost of
providing enrollees out-of-network health care services; but in this
case the expenditure for total out-of-network costs for all
enrollees in all point-of-service contracts shall be limited to a
percentage, acceptable to the director, not to exceed 15 percent of
total health care expenditures for all its enrollees.
(c) Within 30 days of the close of each month a plan offering
point-of-service plan contracts under paragraph (2) of subdivision
(b) shall file with the director a monthly financial report
consisting of a balance sheet and statement of operations of the
plan, which need not be certified, and a calculation of the adjusted
tangible net equity required under subparagraph (A). The financial
statements shall be prepared on a basis consistent with the financial
statements furnished by the plan pursuant to Section 1300.84.2 of
Title 28 of the California Code of Regulations. A plan shall also
make special reports to the director as the director may from time to
time require. Each report to be filed by a plan pursuant to this
subdivision shall be verified by a principal officer of the plan as
set forth in Section 1300.84.2(e) of Title 28 of the California Code
of Regulations.
(d) If it appears to the director that a plan does not have
sufficient financial viability, or organizational and administrative
capacity to assure the delivery of health care services to its
enrollees, the director may, by written order, direct the plan to
discontinue the offering of a point-of-service plan contract. The
order shall be effective immediately.
SEC. 5. Section 1375.4 of the Health and Safety Code is amended to
read:
1375.4. (a) Every contract between a health care service plan and
a risk-bearing organization that is issued, amended, renewed, or
delivered in this state on or after July 1, 2000, shall include
provisions concerning the following, as to the risk-bearing
organization's administrative and financial capacity, which shall be
effective as of January 1, 2001:
(1) A requirement that the risk-bearing organization furnish
financial information to the health care service plan or the plan's
designated agent and meet any other financial requirements that
assist the health care service plan in maintaining the financial
viability of its arrangements for the provision of health care
services in a manner that does not adversely affect the integrity of
the contract negotiation process.
(2) A requirement that the health care service plan disclose
information to the risk-bearing organization that enables the
risk-bearing organization to be informed regarding the financial risk
assumed under the contract.
(3) A requirement that the health care service plans provide
payments of all risk arrangements, excluding capitation, within 180
days after close of the fiscal year.
(b) In accordance with subdivision (a) of Section 1344, the
director shall adopt regulations on or before June 30, 2000, to
implement this section which shall, at a minimum, provide for the
following:
(1) (A) A process for reviewing or grading risk-bearing
organizations based on the following criteria:
(i) The risk-bearing organization meets criterion 1 if it
reimburses, contests, or denies claims for health care services it
has provided, arranged, or for which it is otherwise financially
responsible in accordance with the timeframes and other requirements
described in Section 1371 and in accordance with any other applicable
state and federal laws and regulations.
(ii) The risk-bearing organization meets criterion 2 if it
estimates its liability for incurred but not reported claims pursuant
to a method that has not been held objectionable by the director,
records the estimate at least quarterly as an accrual in its books
and records, and appropriately reflects this accrual in its financial
statements.
(iii) The risk-bearing organization meets criterion 3 if it
maintains at all times a positive tangible net equity, as defined in
subdivision (e) of Section 1300.76 of Title 28 of the California Code
of Regulations.
(iv) The risk-bearing organization meets criterion 4 if it
maintains at all times a positive level of working capital (excess of
current assets over current liabilities).
(B) A risk-bearing organization may reduce its liabilities for
purposes of calculating tangible net equity, pursuant to clause (iii)
of subparagraph (A), and working capital, pursuant to clause (iv) of
subparagraph (A), by the amount of any liabilities the payment of
which is guaranteed by a sponsoring organization pursuant to a
qualified guarantee. A sponsoring organization is one that has a
tangible net equity of a level to be established by the director that
is in excess of all amounts that it has guaranteed to any person or
entity. A qualified guarantee is one that meets all of the following:
(i) It is approved by a board resolution of the sponsoring
organization.
(ii) The sponsoring organization agrees to submit audited annual
financial statements to the plan within 120 days of the end of the
sponsoring organization's fiscal year.
(iii) The guarantee is unconditional except for a maximum monetary
limit.
(iv) The guarantee is not limited in duration with respect to
liabilities arising during the term of the guarantee.
(v) The guarantee provides for six months' advance notice to the
plan prior to its cancellation.
(2) The information required from risk-bearing organizations to
assist in reviewing or grading these risk-bearing organizations,
including balance sheets, claims reports, and designated annual,
quarterly, or monthly financial statements prepared in accordance
with generally accepted accounting principles, to be used in a
manner, and to the extent necessary, provided to a single external
party as approved by the director to the extent that it does not
adversely affect the integrity of the contract negotiation process
between the health care service plan and the risk-bearing
organizations.
(3) Audits to be conducted in accordance with generally accepted
auditing standards and in a manner that avoids duplication of review
of the risk-bearing organization.
(4) A process for corrective action plans, as mutually agreed upon
by the health care service plan and the risk-bearing organization
and as approved by the director, for cases where the review or
grading indicates deficiencies that need to be corrected by the
risk-bearing organization, and contingency plans to ensure the
delivery of health care services if the corrective action fails. The
corrective action plan shall be approved by the director and
standardized, to the extent possible, to meet the needs of the
director and all health care service plans contracting with the
risk-bearing organization. If the health care service plan and the
risk-bearing organization are unable to determine a mutually
agreeable corrective action plan, the director shall determine the
corrective action plan.
(5) The disclosure of information by health care service plans to
the risk-bearing organization that enables the risk-bearing
organization to be informed regarding the risk assumed under the
contract, including:
(A) Enrollee information monthly.
(B) Risk arrangement information, information pertaining to any
pharmacy risk assumed under the contract, information regarding
incentive payments, and information on income and expenses assigned
to the risk-bearing organization quarterly.
(6) Periodic reports from each health care service plan to the
director that include information concerning the risk-bearing
organizations and the type and amount of financial risk assumed by
them, and, if deemed necessary and appropriate by the director, a
registration process for the risk-bearing organizations.
(7) The confidentiality of financial and other records to be
produced, disclosed, or otherwise made available, unless as otherwise
determined by the director.
(c) The failure by a health care service plan to comply with the
contractual requirements pursuant to this section shall constitute
grounds for disciplinary action. The director shall, as appropriate,
within 60 days after receipt of documented violation from a
risk-bearing organization, investigate and take enforcement action
against a health care service plan that fails to comply with these
requirements and shall periodically evaluate contracts between health
care service plans and risk-bearing organizations to determine if
any audit, evaluation, or enforcement actions should be undertaken by
the department.
(d) The Financial Solvency Standards Board established in Section
1347.15 shall study and report to the director on or before January
1, 2001, regarding all of the following:
(1) The feasibility of requiring that there be in force insurance
coverage commensurate with the financial risk assumed by the
risk-bearing organization to protect against financial losses.
(2) The appropriateness of different risk-bearing arrangements
between health care service plans and risk-bearing organizations.
(3) The appropriateness of the four criteria specified in
paragraph (1) of subdivision (b).
(e) This section shall not apply to specialized health care
service plans.
(f) For purposes of this section, "provider organization" means a
medical group, independent practice association, or other entity that
delivers, furnishes, or otherwise arranges for or provides health
care services, but does not include an individual or a plan.
(g) (1) For purposes of this section, a "risk-bearing organization"
means a professional medical corporation, other form of corporation
controlled by physicians and surgeons, a medical partnership, a
medical foundation exempt from licensure pursuant to subdivision ()
of Section 1206, or
another lawfully organized group of physicians that delivers,
furnishes, or otherwise arranges for or provides health care
services, but does not include an individual or a health care service
plan, and that does all of the following:
(A) Contracts directly with a health care service plan or arranges
for health care services for the health care service plan's
enrollees.
(B) Receives compensation for those services on any capitated or
fixed periodic payment basis.
(C) Is responsible for the processing and payment of claims made
by providers for services rendered by those providers on behalf of a
health care service plan that are covered under the capitation or
fixed periodic payment made by the plan to the risk-bearing
organization. Nothing in this subparagraph in any way limits, alters,
or abrogates any responsibility of a health care service plan under
existing law.
(2) Notwithstanding paragraph (1), risk-bearing organizations
shall not be deemed to include a provider organization that meets
either of the following requirements:
(A) The health care service plan files with the department
consolidated financial statements that include the provider
organization.
(B) The health care service plan is the only health care service
plan with which the provider organization contracts for arranging or
providing health care services and, during the previous and current
fiscal years, the provider organization's maximum potential expenses
for providing or arranging for health care services did not exceed
115 percent of its maximum potential revenue for providing or
arranging for those services.
(h) For purposes of this section, "claims" include, but are not
limited to, contractual obligations to pay capitation or payments on
a managed hospital payment basis.
SEC. 6. Section 1376.1 of the Health and Safety Code is amended to
read:
1376.1. The deposit requirements of Section 1300.76.1 of Title 28
of the California Code of Regulations shall not apply to any plan
operated by a county, or city and county, if both of the following
apply:
(a) All of the evidence of indebtedness of the county, or city and
county, has been rated "A" or better by Moody's Investors Service,
Inc. or Standard & Poor's Corporation, based on a rating conducted
during the immediately preceding 12 months.
(b) The county, or city and county, has cash or cash equivalents
in an amount equal to fifty million dollars ($50,000,000) or more,
based on its audited financial statements for the immediately
preceding fiscal year. For purposes of this subdivision, the term
"equivalents" shall have the same meaning as in Section 1300.77 of
Title 28 of the California Code of Regulations.
SEC. 7. Section 1377 of the Health and Safety Code is amended to
read:
1377. (a) Every plan which reimburses providers of health care
services that do not contract in writing with the plan to provide
health care services, or which reimburses its subscribers or
enrollees for costs incurred in having received health care services
from providers that do not contract in writing with the plan, in an
amount which exceeds 10 percent of its total costs for health care
services for the immediately preceding six months, shall comply with
the requirements set forth in either paragraph (1) or (2):
(1) (A) Place with the director, or with any organization or
trustee acceptable to the director through which a custodial or
controlled account is maintained, a noncontracting provider
insolvency deposit consisting of cash or securities that are
acceptable to the director that at all times have a fair market value
in an amount at least equal to 120 percent of the sum of the
following:
(i) All claims for noncontracting provider services received for
reimbursement, but not yet processed.
(ii) All claims for noncontracting provider services denied for
reimbursement during the previous 45 days.
(iii) All claims for noncontracting provider services approved for
reimbursement, but not yet paid.
(iv) An estimate of claims for noncontracting provider services
incurred, but not reported.
(B) Each plan licensed pursuant to this chapter prior to January
1, 1991, shall, upon that date, make a deposit of 50 percent of the
amount required by subparagraph (A), and shall maintain additional
cash or cash equivalents as defined by rule of the director, in the
amount of 50 percent of the amount required by subparagraph (A), and
shall make a deposit of 100 percent of the amount required by
subparagraph (A) by January 1, 1992.
(C) The amount of the deposit shall be reasonably estimated as of
the first day of the month and maintained for the remainder of the
month.
(D) The deposit required by this paragraph is in addition to the
deposit that may be required by rule of the director and is an
allowable asset of the plan in the determination of tangible net
equity as defined in subdivision (b) of Section 1300.76 of Title 28
of the California Code of Regulations. All income from the deposit
shall be an asset of the plan and may be withdrawn by the plan at any
time.
(E) A health care service plan that has made a deposit may
withdraw that deposit or any part of the deposit if (i) a substitute
deposit of cash or securities of equal amount and value is made, (ii)
the fair market value exceeds the amount of the required deposit, or
(iii) the required deposit under this paragraph is reduced or
eliminated. Deposits, substitutions, or withdrawals may be made only
with the prior written approval of the director, but approval shall
not be required for the withdrawal of earned income.
(F) The deposit required under this section is in trust and may be
used only as provided by this section. The director or, if a
receiver has been appointed, the receiver shall use the deposit of an
insolvent health care service plan, as defined in Sections 1394.7
and 1394.8, for payment of covered claims for services rendered by
noncontracting providers under circumstances covered by the plan. All
claims determined by the director or receiver, in his or her
discretion, to be eligible for reimbursement under this section shall
be paid on a pro rata basis based on assets available from the
deposit to pay the ultimate liability for incurred expenditures.
Partial distribution may be made pending final distribution. Any
amount of the deposit remaining shall be paid into the liquidation or
receivership of the health care service plan. The director may also
use the deposit of an insolvent health care service plan for payment
of any administrative costs associated with the administration of
this section. The department, the director, and any employee of the
department shall not be liable, as provided by Section 820.2 of the
Government Code, for an injury resulting from an exercise of
discretion pursuant to this section. Nothing in this section shall be
construed to provide immunity for the acts of a receiver, except
when the director is acting as a receiver.
(G) The director may, by regulation, prescribe the time, manner,
and form for filing claims.
(H) The director may permit a plan to meet a portion of this
requirement by a deposit of tangible assets acceptable to the
director, the fair market value of which shall be determined on at
least an annual basis by the director. The plan shall bear the cost
of any appraisal or valuations required hereunder by the director.
(2) Maintain adequate insurance, or a guaranty arrangement
approved in writing by the director, to pay for any loss to
providers, subscribers, or enrollees claiming reimbursement due to
the insolvency of the plan.
(b) Whenever the reimbursements described in this section exceed
10 percent of the plan's total costs for health care services over
the immediately preceding six months, the plan shall file a written
report with the director containing the information necessary to
determine compliance with subdivision (a) no later than 30 business
days from the first day of the month. Upon an adequate showing by the
plan that the requirements of this section should be waived or
reduced, the director may waive or reduce these requirements to an
amount as the director deems sufficient to protect subscribers and
enrollees of the plan consistent with the intent and purpose of this
chapter.
(c) Every plan which reimburses providers of health care service
on a fee-for-services basis; or which directly reimburses its
subscribers or enrollees, to an extent exceeding 10 percent of its
total payments for health care services, shall estimate and record in
the books of account a liability for incurred and unreported claims.
Upon a determination by the director that the estimate is
inadequate, the director may require the plan to increase its
estimate of incurred and unreported claims. Every plan shall promptly
report to the director whenever these reimbursables exceed 10
percent of its total expenditures for health care services.
As used herein, the term "fee-for-services" refers to the
situation where the amount of reimbursement paid by the plan to
providers of service is determined by the amount and type of service
rendered by the provider of service.
(d) In the event an insolvent plan covered by this section fails
to pay a noncontracting provider sums for covered services owed, the
provider shall first look to the uncovered expenditures insolvency
deposit or the insurance or guaranty arrangement maintained by the
plan for payment. When a plan becomes insolvent, in no event shall a
noncontracting provider, or agent, trustee, or assignee thereof,
attempt to collect from the subscriber or enrollee sums owed for
covered services by the plan or maintain any action at law against a
subscriber or enrollee to collect sums owed by the plan for covered
services without having first attempted to obtain reimbursement from
the plan.
SEC. 8. Section 1399 of the Health and Safety Code is amended to
read:
1399. (a) Surrender of a license as a health plan becomes
effective 30 days after receipt of an application to surrender the
license or within a shorter period of time as the director may
determine, unless a revocation or suspension proceeding is pending
when the application is filed or a proceeding to revoke or suspend or
to impose conditions upon the surrender is instituted within 30 days
after the application is filed. If this proceeding is pending or
instituted, surrender becomes effective at the time and upon the
conditions as the director by order determines.
(b) If the director finds that any plan is no longer in existence,
or has ceased to do business or has failed to initiate business
activity as a licensee within six months after licensure, or cannot
be located after reasonable search, the director may by order
summarily revoke the license of the plan.
(c) The director may summarily suspend or revoke the license of a
plan upon (1) failure to pay any fee required by this chapter within
15 days after notice by the director that the fee is due and unpaid,
(2) failure to file any amendment or report required under this
chapter within 15 days after notice by the director that the report
is due, (3) failure to maintain any bond or insurance pursuant to
Section 1376, (4) failure to maintain a deposit, insurance, or
guaranty arrangement pursuant to Section 1377, or (5) failure to
maintain a deposit pursuant to Section 1300.76.1 of Title 28 of the
California Code of Regulations.
SEC. 9. Section 116283 of the Health and Safety Code, as added by
Section 4 of Chapter 874 of the Statutes of 1996, is amended to read:
116283. This chapter shall apply to a food facility that is
regulated pursuant to the California Retail Food Code only if the
human consumption includes drinking of water.
SEC. 10. Section 116283 of the Health and Safety Code, as added by
Section 4 of Chapter 875 of the Statutes of 1996, is amended to
read:
116283. This chapter shall apply to a food facility that is
regulated pursuant to the California Retail Food Code only if the
human consumption includes drinking of water.
SEC. 11. Section 116286 of the Health and Safety Code is amended
to read:
116286. (a) A water district, as defined in subdivision (b), in
existence prior to May 18, 1994, that provides primarily agricultural
services through a piped water system with only incidental
residential or similar uses shall not be considered to be a public
water system if the department determines that either of the
following applies:
(1) The system certifies that it is providing alternative water
for residential or similar uses for drinking water and cooking to
achieve the equivalent level of public health protection provided by
the applicable primary drinking water regulations.
(2) The water provided for residential or similar uses for
drinking, cooking, and bathing is centrally treated or treated at the
point of entry by the provider, a passthrough entity, or the user to
achieve the equivalent level of protection provided by the
applicable primary drinking water regulations.
(b) For purposes of this section, "water district" means any
district or other political subdivision, other than a city or county,
a primary function of which is irrigation, reclamation, or drainage
of land.
SEC. 12. Section 116380 of the Health and Safety Code is amended
to read:
116380. In addition to the requirements set forth in Section
116375, the regulations adopted by the department pursuant to Section
116375 shall include requirements governing the use of
point-of-entry and point-of-use treatment by public water systems in
lieu of centralized treatment where it can be demonstrated that
centralized treatment is not immediately economically
feasible . , limited to the following:
(a) Water systems with less than 200 service connections.
(b) Usage allowed under the federal Safe Drinking Water Act and
its implementing regulations and guidance.
(c) Water systems that have submitted preapplications with the
State Department of Public Health for funding to correct the
violations for which the point-of-use treatment is provided.
SEC. 13. Section 116450 of the Health
and Safety Code is amended to read:
116450. (a) When any a primary
drinking water standard specified in the department's regulations is
not complied with, when a monitoring requirement specified in the
department's regulations is not performed, or when a water purveyor
fails to comply with the conditions of any variance or exemption, the
person operating the public water system shall notify the department
and shall give notice to the users of that fact in the manner
prescribed by the department. When a variance or an exemption is
granted, the person operating the public water system shall give
notice to the users of that fact.
(b) When a person operating a public water system determines that
a significant rise in the bacterial count of water has occurred in
water he or she supplies, the person shall provide, at his or her
expense, a report on the rise in bacterial count of the water,
together with the results of an analysis of the water, within 24
hours to the department and, where appropriate, to the local health
officer.
(c) When the department receives the information described in
subdivision (b) and determines that it constitutes an immediate
danger to health, the department shall immediately notify the person
operating the public water system to implement the emergency
notification plan required by this chapter.
(d) In the case of a failure to comply with any
a primary drinking water standard that represents an
imminent danger to the health of water users, the operator shall
notify each of his or her customers as provided in the approved
emergency notification plan.
(e) In addition, the same notification requirement shall be
required in any instance in which the department or the local health
department recommends to the operator that it notify its customers to
avoid internal consumption of the water supply and to use bottled
water due to a chemical contamination problem that may pose a health
risk.
(f) The content of the notices required by this section shall be
approved by the department. Notice shall be repeated at intervals, as
required by the department, until the department concludes that
there is compliance with its standards or requirements. Notices may
be given by the department.
In any case where
When public notification is required by this section
because a contaminant is present in drinking water at a level in
excess of a primary drinking water standard, the notification shall
include identification of the contaminant, information on possible
effects of the contaminant on human health, and information on
specific measures that should be taken by persons or populations who
might be more acutely affected than the general population.
(g) Whenever a school or school system, the owner or operator of
residential rental property, or the owner or operator of a business
property receives a notification from a person operating a public
water system under any provision of this section, the school or
school system shall notify school employees, students and parents if
the students are minors, the owner or operator of a residential
rental property shall notify tenants, and the owner or operator of
business property shall notify employees of businesses located on the
property.
(1) The operator shall provide the customer with a sample
notification form that may be used by the customer in complying with
this subdivision and that shall indicate the nature of the problem
with the water supply and the most appropriate methods for
notification that may include, but is not limited to, the sending of
a letter to each water user and the posting of a notice at each site
where drinking water is dispensed.
(2) The notice required by this subdivision shall be given within
10 days of receipt of notification from the person operating the
public water system.
(3) Any person failing to give notice as required by this
subdivision shall be civilly liable in an amount not to exceed one
thousand dollars ($1,000) for each day of failure to give notice.
(4) If the operator has evidence of noncompliance with this
subdivision the operator shall report this information to the local
health department and the department.
(h) If user notification is required pursuant to this section, the
department shall make a reasonable effort to ensure that
notification is given.
SEC. 13. SEC. 14. Section 116540 of
the Health and Safety Code is amended to read:
116540. Following completion of the investigation and
satisfaction of the requirements of subdivisions (a) and (b), the
department shall issue or deny the permit. The department may impose
permit conditions, requirements for system improvements, and time
schedules as it deems necessary to assure a reliable and adequate
supply of water at all times that is pure, wholesome, potable, and
does not endanger the health of consumers.
(a) No public water system that was not in existence on January 1,
1998, shall be granted a permit unless the system demonstrates to
the department that the water supplier possesses adequate financial,
managerial, and technical capability to assure the delivery of pure,
wholesome, and potable drinking water. This section shall also apply
to any change of ownership of a public water system that occurs after
January 1, 1998.
(b) No permit under this chapter shall be issued to an association
organized under Title 3 (commencing with Section 18000) of Division
3 of the Corporations Code. This section shall not apply to
unincorporated associations that as of December 31, 1990, are holders
of a permit issued under this chapter.
SEC. 15. Section 116552 is added to the
Health and Safety Code , to read:
116552. The department shall not issue a permit to a public water
system or amend a valid existing permit to allow the use of
point-of-use treatment unless the department determines, after
conducting a public hearing in the community served by the public
water system, that there is no substantial community opposition to
the installation of point-of-use treatment devices. The issuance of a
permit pursuant to this section shall be limited to not more than
three years or until funding for centralized treatment is available,
whichever occurs first.
SEC. 14. SEC. 16. Section 116650 of
the Health and Safety Code is amended to read:
116650. (a) If the department determines that a public water
system is in violation of this chapter or any regulation, permit,
standard, or order issued or adopted thereunder, the department may
issue a citation to the public water system. The citation shall be
served upon the public water system personally or by registered mail.
(b) Each citation shall be in writing and shall describe with
particularity the nature of the violation, including a reference to
the statutory provision, standard, order, or regulation alleged to
have been violated.
(c) For continuing violations, the citation shall fix the earliest
feasible time for elimination or correction of the condition
constituting the violation where appropriate. If the public water
system fails to correct a violation within the time specified in the
citation, the department may assess a civil penalty as specified in
subdivision (e).
(d) For a noncontinuing violation of primary drinking standards,
the department may assess in the citation a civil penalty as
specified in subdivision (e).
(e) Citations issued pursuant to this section shall be classified
according to the nature of the violation or the failure to comply.
The department shall specify the classification in the citation and
may assess civil penalties for each classification as follows:
(1) For violation of a primary drinking standard, an amount not to
exceed one thousand dollars ($1,000) per day for each day that the
violation occurred, including each day that the violation continues
beyond the date specified for correction in the citation or order.
(2) For failure to comply with any citation or order issued for
violation of a secondary drinking water standard that the director
determines may have a direct or immediate relationship to the welfare
of the users, an amount not to exceed one thousand dollars ($1,000)
for each day that the violation continues beyond the date specified
for correction in the citation or order.
(3) For failure to comply with any citation or order issued for
noncompliance with any department regulation or order, other than a
primary or secondary drinking water standard, an amount not to exceed
two hundred dollars ($200) per day for each day the violation
continues beyond the date specified for correction in the citation.
SEC. 15. SEC. 17. Section 116725 of
the Health and Safety Code is amended to read:
116725. (a) Any person who knowingly makes any false statement
or representation in any application, record, report, or other
document submitted, maintained, or used for purposes of compliance
with this chapter, may be liable, as determined by the court, for a
civil penalty not to exceed five thousand dollars ($5,000) for each
separate violation or, for continuing violations, for each day that
violation continues.
(b) Any person who violates a citation schedule of compliance for
a primary drinking water standard or any order regarding a primary
drinking water standard or the requirement that a reliable and
adequate supply of pure, wholesome, healthful, and potable water be
provided may be liable, as determined by the court, for a civil
penalty not to exceed twenty-five thousand dollars ($25,000) for each
separate violation or, for continuing violations, for each day that
violation continues.
(c) Any person who violates any order, other than one specified in
subdivision (b), issued pursuant to this chapter may be liable, as
determined by the court, for a civil penalty not to exceed five
thousand dollars ($5,000) for each separate violation or, for
continuing violations, for each day that violation continues.
(d) Any person who operates a public water system without a permit
issued by the department pursuant to this chapter may be liable, as
determined by the court, for a civil penalty not to exceed
twenty-five thousand dollars ($25,000) for each separate violation
or, for continuing violations, for each day that violation continues.
(e) Each civil penalty imposed for any separate violation pursuant
to this section shall be separate and in addition to any other civil
penalty imposed pursuant to this section or any other provision of
law.
SEC. 16. SEC. 18. Section 121360.5
of the Health and Safety Code is amended to read:
121360.5. (a) Any city or county health department that elects to
participate in this program shall provide for one-year certification
of tuberculin skin test technicians by local health officers.
(b) For purposes of this section, a "certified tuberculin skin
test technician" is an unlicensed public health tuberculosis worker
employed by, or under contract with, a local public health
department, and who is certified by a local health officer to place
and measure skin tests in the local health department's jurisdiction.
(c) A certified tuberculin skin test technician may perform the
functions for which he or she is certified only if he or she meets
all of the following requirements:
(1) The certified tuberculin skin test technician is working under
the direction of the local health officer or the tuberculosis
controller.
(2) The certified tuberculin skin test technician is working under
the supervision of a licensed health professional. For purposes of
this section, "supervision" means the licensed health professional is
immediately available for consultation with the tuberculin skin test
technician through telephonic or electronic contact.
(d) A certified tuberculin skin test technician may perform
intradermal injections only for the purpose of placing a tuberculin
skin test and measuring the test result.
(e) A certified tuberculin skin test technician may not be
certified to interpret, and may not interpret, the results of a
tuberculin skin test.
(f) In order to be certified as a tuberculin skin test technician
by a local health officer, a person shall meet all of the following
requirements, and provide to the local health officer appropriate
documentation establishing that he or she has met those requirements:
(1) The person has a high school diploma, or its
equivalent.
(2) (A) The person has completed a standardized course approved by
the California Tuberculosis Controllers Association (CTCA), which
shall include at least 24 hours of instruction in all of the
following areas: Didactic instruction on tuberculosis control
principles and instruction on the proper placement and measurement of
tuberculin skin tests, equipment usage, basic infection control,
universal precautions, and appropriate disposal of sharps, needles,
and medical waste, client preparation and education, safety,
communication, professional behavior, and the importance of
confidentiality.
(B) A certification of satisfactory completion of this
CTCA-approved course shall be dated and signed by the local health
officer, and shall contain the name and social security number of the
tuberculin skin test technician, and the printed name, the
jurisdiction, and the telephone number of the certifying local health
officer.
(3) The person has completed practical instruction including
placing at least 30 successful intradermal tuberculin skin tests,
supervised by a licensed physician or registered nurse at the local
health department, and 30 correct measurements of intradermal
tuberculin skin tests, at least 15 of which are deemed positive by
the licensed physician or registered nurse supervising the practical
instruction. A certification of the satisfactory completion of this
practical instruction shall be dated and signed by the licensed
physician or registered nurse supervising the practical instruction.
(g) The certification may be renewed, and the local health
department shall provide a certificate of renewal, if the certificate
holder has completed in-service training, including all of the
following:
(1) At least three hours of a CTCA-approved standardized training
course to assure continued competency. This training shall include,
but not be limited to, fundamental principles of tuberculin skin
testing.
(2) Practical instruction, under the supervision of a licensed
physician or registered nurse at the local health department,
including the successful placement and correct measurement of 10
tuberculin skin tests, at least five of which are deemed positive by
the licensed physician or registered nurse supervising the practical
instruction.
(h) The local health officer or the tuberculosis controller may
deny or revoke the certification of a tuberculin skin test technician
if the local health officer or the tuberculosis controller finds
that the technician is not in compliance with this section.
(i) Each county or city participating in the program under this
section using tuberculin skin test technicians, that elects to
participate on or after January 1, 2005, shall submit to the CTCA a
survey and an evaluation of its findings, including a review of the
aggregate report, by July 1, 2006, and by July 1 of each year
thereafter to, and including, July 1, 2011. The report shall include
the following:
(1) The number of persons trained and certified as tuberculin skin
test technicians in that city or county.
(2) The estimated number of tuberculin skin tests placed by
tuberculin skin test technicians in that city or county.
(j) By July 1, 2008, the CTCA shall submit a summary of barriers
to implementing the tuberculosis technician program in the state to
the department and to the appropriate policy and fiscal committees of
the Legislature.
(k) The local health officer of each participating city or county
shall report to the Tuberculosis Control Branch within the department
any adverse event that he or she determines has resulted from
improper tuberculin skin test technician training or performance.
SEC. 17. SEC. 19. Section 127662 of
the Health and Safety Code is amended to read:
127662. (a) In order to effectively support the University of
California and its work in implementing this chapter, there is hereby
established in the State Treasury, the Health Care Benefits Fund.
The university's work in providing the bill analyses shall be
supported from the fund.
(b) For fiscal years 2010-11 to 2014-15, inclusive, each health
care service plan, except a specialized health care service plan, and
each health insurer, as defined in Section 106 of the Insurance
Code, shall be assessed an annual fee in an amount determined through
regulation. The amount of the fee shall be determined by the
Department of Managed Health Care and the Department of Insurance in
consultation with the university and shall be limited to the amount
necessary to fund the actual and necessary expenses of the university
and its work in implementing this chapter. The total annual
assessment on health care service plans and health insurers shall not
exceed two million dollars ($2,000,000).
(c) The Department of Managed Health Care and the Department of
Insurance, in coordination with the university, shall assess the
health care service plans and health insurers, respectively, for the
costs required to fund the university's activities pursuant to
subdivision (b).
(1) Health care service plans shall be notified of the assessment
on or before June 15 of each year with the annual assessment notice
issued pursuant to Section 1356. The assessment pursuant to this
section is separate and independent of the assessments in Section
1356.
(2) Health insurers shall be noticed of the assessment in
accordance with the notice for the annual assessment or quarterly
premium tax revenues.
(3) The assessed fees required pursuant to subdivision (b) shall
be paid on an annual basis no later than August 1 of each year. The
Department of Managed Health Care and the Department of Insurance
shall forward the assessed fees to the Controller for deposit in the
Health Care Benefits Fund immediately following their receipt.
(4) "Health insurance," as used in this subdivision, does not
include Medicare supplement, vision-only, dental-only, or CHAMPUS
supplement insurance, or hospital indemnity, accident-only, or
specified disease insurance that does not pay benefits on a fixed
benefit, cash payment only basis.
SEC. 18. SEC. 20. Section 127664 of
the Health and Safety Code is amended to read:
127664. The Legislature requests the University of California to
submit a report to the Governor and the Legislature by January 1,
2014, regarding the implementation of this chapter.
SEC. 19. SEC. 21. Section 127665 of
the Health and Safety Code is amended to read:
127665. This chapter shall remain in effect until June 30, 2015,
and shall be repealed as of that date, unless a later enacted statute
that becomes operative on or before June 30, 2015, deletes or
extends that date.
SEC. 20. SEC. 22. Section 128730 of
the Health and Safety Code is amended to read:
128730. (a) Effective January 1, 1986, the office shall be the
single state agency designated to collect the following health
facility or clinic data for use by all state agencies:
(1) That data required by the office pursuant to Section 127285.
(2) That data required in the Medi-Cal cost reports pursuant to
Section 14170 of the Welfare and Institutions Code.
(3) Those data items formerly required by the California Health
Facilities Commission that are listed in Sections 128735 and 128740.
Information collected pursuant to subdivision (g) of Section 128735
and Sections 128736 and 128737 shall be made available to the State
Department of Health Care Services and the State Department of Public
Health. The departments shall ensure that the patient's rights to
confidentiality shall not be violated in any manner. The departments
shall comply with all applicable policies and requirements involving
review and oversight by the State Committee for the Protection of
Human Subjects.
(b) The office shall consolidate any and all of the reports listed
under this section or Sections 128735 and 128740, to the extent
feasible, to minimize the reporting burdens on hospitals. Provided,
however, that the office shall neither add nor delete data items from
the Hospital Discharge Abstract Data Record or the quarterly reports
without prior authorizing legislation, unless specifically required
by federal law or regulation or judicial decision.
SEC. 21. SEC. 23. Section 128745 of
the Health and Safety Code is amended to read:
128745. (a) Commencing July 1993, and annually thereafter, the
office shall publish risk-adjusted outcome reports in accordance with
the following schedule:
Procedures and
Publication Period Conditions
Date Covered Covered
July 1993 1988-90 3
July 1994 1989-91 6
July 1995 1990-92 9
Reports for subsequent years shall include conditions and
procedures and cover periods as appropriate.
(b) The procedures and conditions required to be reported under
this chapter shall be divided among medical, surgical and obstetric
conditions or procedures and shall be selected by the office, based
on the recommendations of the commission and the advice of the
technical advisory committee set forth in subdivision (j) of Section
128725. The office shall publish the risk-adjusted outcome reports
for surgical procedures by individual hospital and individual surgeon
unless the office in consultation with the technical advisory
committee and medical specialists in the relevant area of practice
determines that it is not appropriate to report by individual
surgeon. The office, in consultation with the technical advisory
committee and medical specialists in the relevant area of practice,
may decide to report nonsurgical procedures and conditions by
individual physician when it is appropriate. The selections shall be
in accordance with all of the following criteria:
(1) The patient discharge abstract contains sufficient data to
undertake a valid risk adjustment. The risk adjustment report shall
ensure that public hospitals and other hospitals serving primarily
low-income patients are not unfairly discriminated against.
(2) The relative importance of the procedure and condition in
terms of the cost of cases and the number of cases and the
seriousness of the health consequences of the procedure or condition.
(3) Ability to measure outcome and the likelihood that care
influences outcome.
(4) Reliability of the diagnostic and procedure data.
(c) (1) In addition to any other established and pending reports,
on or before July 1, 2002, the office shall publish a risk-adjusted
outcome report for coronary artery bypass graft surgery by hospital
for all hospitals opting to participate in the report. This report
shall be updated on or before July 1, 2003.
(2) In addition to any other established and pending reports,
commencing July 1, 2004, and every year thereafter, the office shall
publish risk-adjusted outcome reports for coronary artery bypass
graft surgery for all coronary artery bypass graft surgeries
performed in the state. In each year, the reports shall compare
risk-adjusted outcomes by hospital, and in every other year, by
hospital and cardiac surgeon. Upon the recommendation of the
technical advisory committee based on statistical and technical
considerations, information on individual hospitals and surgeons may
be excluded from the reports.
(3) Unless otherwise recommended by the clinical panel established
by Section 128748, the office shall collect the same data used for
the most recent risk-adjusted model developed for the California
Coronary Artery Bypass Graft Mortality Reporting Program. Upon
recommendation of the clinical panel, the office may add any clinical
data elements included in the Society of Thoracic Surgeons'
database. Prior to any additions from the Society of Thoracic
Surgeons' database, the following factors shall be considered:
(A) Utilization of sampling to the maximum extent possible.
(B) Exchange of data elements as opposed to addition of data
elements.
(4) Upon recommendation of the clinical panel, the office may add,
delete or revise clinical data elements, but shall add no more than
a net of six elements not included in the Society of Thoracic
Surgeons' database, to the data set over any five-year period. Prior
to any additions or deletions, all of the following factors shall be
considered:
(A) Utilization of sampling to the maximum extent possible.
(B) Feasibility of collecting data elements.
(C) Costs and benefits of collection and submission of data.
(D) Exchange of data elements as opposed to addition of data
elements.
(5) The office shall collect the minimum data necessary for
purposes of testing or validating a risk-adjusted model for the
coronary artery bypass graft report.
(6) Patient medical record numbers and any other data elements
that the office believes could be used to determine the identity of
an individual patient shall be exempt from the disclosure
requirements of the California Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7 of Title 1 of the
Government Code).
(d) The annual reports shall compare the risk-adjusted outcomes
experienced by all patients treated for the selected conditions and
procedures in each California hospital during the period covered by
each report, to the outcomes expected. Outcomes shall be reported in
the five following groupings for each hospital:
(1) "Much higher than average outcomes," for hospitals with
risk-adjusted outcomes much higher than the norm.
(2) "Higher than average outcomes," for hospitals with
risk-adjusted outcomes higher than the norm.
(3) "Average outcomes," for hospitals with average risk-adjusted
outcomes.
(4) "Lower than average outcomes," for hospitals with
risk-adjusted outcomes lower than the norm.
(5) "Much lower than average outcomes," for hospitals with
risk-adjusted outcomes much lower than the norm.
(e) For coronary artery bypass graft surgery reports and any other
outcome reports for which auditing is appropriate, the office shall
conduct periodic auditing of data at hospitals.
(f) The office shall publish in the annual reports required under
this section the risk-adjusted mortality rate for each hospital and
for those reports that include physician reporting, for each
physician.
(g) The office shall either include in the annual reports required
under this section, or make separately available at cost to any
person requesting it, risk-adjusted outcomes data assessing the
statistical significance of hospital or physician data at each of the
following three levels: 99 percent confidence level (0.01 p-value),
95 percent confidence level (0.05 p-value), and 90 percent confidence
level (.10 p-value). The office shall include any other analysis or
comparisons of the data in the annual reports required under this
section that the office deems appropriate to further the purposes of
this chapter.
SEC. 22. SEC. 24. Section 14043.26
of the Welfare and Institutions Code is amended to read:
14043.26. (a) (1) On and after January 1, 2004, an applicant that
currently is not enrolled in the Medi-Cal program, or a provider
applying for continued enrollment, upon written notification from the
department that enrollment for continued participation of all
providers in a specific provider of service category or subgroup of
that category to which the provider belongs will occur, or, except as
provided in subdivisions (b) and (e), a provider not currently
enrolled at a location where the provider intends to provide
services, goods, supplies, or merchandise to a Medi-Cal beneficiary,
shall submit a complete application package for enrollment,
continuing enrollment, or enrollment at a new location or a change in
location.
(2) Clinics licensed by the department pursuant to Chapter 1
(commencing with Section 1200) of Division 2 of the Health and Safety
Code and certified by the department to participate in the Medi-Cal
program shall not be subject to this section.
(3) Health facilities licensed by the department pursuant to
Chapter 2 (commencing with Section 1250) of Division 2 of the Health
and Safety Code and certified by the department to participate in the
Medi-Cal program shall not be subject to this section.
(4) Adult day health care providers licensed pursuant to Chapter
3.3 (commencing with Section 1570) of Division 2 of the Health and
Safety Code and certified by the department to participate in the
Medi-Cal program shall not be subject to this section.
(5) Home health agencies licensed pursuant to Chapter 8
(commencing with Section 1725) of Division 2 of the Health and Safety
Code and certified by the department to participate in the Medi-Cal
program shall not be subject to this section.
(6) Hospices licensed pursuant to Chapter 8.5 (commencing with
Section 1745) of Division 2 of the Health and Safety Code and
certified by the department to participate in the Medi-Cal program
shall not be subject to this section.
(b) A physician and surgeon licensed by the Medical Board of
California or the Osteopathic Medical Board of California practicing
in an individual physician practice, who is enrolled and in good
standing in the Medi-Cal program, and who is changing locations of
that individual physician practice within the same county, shall be
eligible to continue enrollment at the new location by filing a
change of location form to be developed by the department. The form
shall comply with all minimum federal requirements related to
Medicaid provider enrollment. Filing this form shall be in lieu of
submitting a complete application package pursuant to subdivision
(a).
(c) (1) Except as provided in paragraph (2), within 30 days after
receiving an application package submitted pursuant to subdivision
(a), the department shall provide written notice that the application
package has been received and, if applicable, that there is a
moratorium on the enrollment of providers in the specific provider of
service category or subgroup of the category to which the applicant
or provider belongs. This moratorium shall bar further processing of
the application package.
(2) Within 15 days after receiving an application package from a
physician, or a group of physicians, licensed by the Medical Board of
California or the Osteopathic Medical Board of California, or a
change of location form pursuant to subdivision (b), the department
shall provide written notice that the application package or the
change of location form has been received.
(d) (1) If the application package submitted pursuant to
subdivision (a) is from an applicant or provider who meets the
criteria listed in paragraph (2), the applicant or provider shall be
considered a preferred provider and shall be granted preferred
provisional provider status pursuant to this section and for a period
of no longer than 18 months, effective from the date on the notice
from the department. The ability to request consideration as a
preferred provider and the criteria necessary for the consideration
shall be publicized to all applicants and providers. An applicant or
provider who desires consideration as a preferred provider pursuant
to this subdivision shall request consideration from the department
by making a notation to that effect on the application package, by
cover letter, or by other means identified by the department in a
provider bulletin. Request for consideration as a preferred provider
shall be made with each application package submitted in order for
the department to grant the consideration. An applicant or provider
who requests consideration as a preferred provider shall be notified
within 60 days whether the applicant or provider meets or does not
meet the criteria listed in paragraph (2). If an applicant or
provider is notified that the applicant or provider does not meet the
criteria for a preferred provider, the application package submitted
shall be processed in accordance with the remainder of this section.
(2) To be considered a preferred provider, the applicant or
provider shall meet all of the following criteria:
(A) Hold a current license as a physician and surgeon issued by
the Medical Board of California or the Osteopathic Medical Board of
California, which license shall not have been revoked, whether stayed
or not, suspended, placed on probation, or subject to other
limitation.
(B) Be a current faculty member of a teaching hospital or a
children's hospital, as defined in Section 10727, accredited by the
Joint Commission or the American Osteopathic Association, or be
credentialed by a health care service plan that is licensed under the
Knox-Keene Health Care Service Plan Act of 1975 (Chapter 2.2
(commencing with Section 1340) of Division 2 of the Health and Safety
Code) or county organized health system, or be a current member in
good standing of a group that is credentialed by a health care
service plan that is licensed under the Knox-Keene Act.
(C) Have full, current, unrevoked, and unsuspended privileges at a
Joint Commission or American Osteopathic Association accredited
general acute care hospital.
(D) Not have any adverse entries in the federal Healthcare
Integrity and Protection Data Bank.
(3) The department may recognize other providers as qualifying as
preferred providers if criteria similar to those set forth in
paragraph (2) are identified for the other providers. The department
shall consult with interested parties and appropriate stakeholders to
identify similar criteria for other providers so that they may be
considered as preferred providers.
(e) (1) If a Medi-Cal applicant meets the criteria listed in
paragraph (2), the applicant shall be enrolled in the Medi-Cal
program after submission and review of a short form application to be
developed by the department. The form shall comply with all minimum
federal requirements related to Medicaid provider enrollment. The
department shall notify the applicant that the department has
received the application within 15 days of receipt of the
application. The department shall issue the applicant a provider
number or notify the applicant that the applicant does not meet the
criteria listed in paragraph (2) within 90 days of receipt of the
application.
(2) Notwithstanding any other provision of law, an applicant or
provider who meets all of the following criteria shall be eligible
for enrollment in the Medi-Cal program pursuant to this subdivision,
after submission and review of a short form application:
(A) The applicant's or provider's practice is based in one or more
of the following: a general acute care hospital, a rural general
acute care hospital, or an acute psychiatric hospital, as defined in
subdivisions (a) and (b) of Section 1250 of the Health and Safety
Code.
(B) The applicant or provider holds a current, unrevoked, or
unsuspended license as a physician and surgeon issued by the Medical
Board of California or the Osteopathic Medical Board of California.
An applicant or provider shall not be in compliance with this
subparagraph if a license revocation has been stayed, the licensee
has been placed on probation, or the license is subject to any other
limitation.
(C) The applicant or provider does not have an adverse entry in
the federal Healthcare Integrity and Protection Data Bank.
(3) An applicant shall be granted provisional provider status
under this subdivision for a period of 12 months.
(f) Except as provided in subdivision (g), within 180 days after
receiving an application package submitted pursuant to subdivision
(a), or from the date of the notice to an applicant or provider that
the applicant or provider does not qualify as a preferred provider
under subdivision (d), the department shall give written notice to
the applicant or provider that any of the following applies, or shall
on the 181st day grant the applicant or provider provisional
provider status pursuant to this section for a period no longer than
12 months, effective from the 181st day:
(1) The applicant or provider is being granted provisional
provider status for a period of 12 months, effective from the date on
the notice.
(2) The application package is incomplete. The notice shall
identify additional information or documentation that is needed to
complete the application package.
(3) The department is exercising its authority under Section
14043.37, 14043.4, or 14043.7, and is conducting background checks,
preenrollment inspections, or unannounced visits.
(4) The application package is denied for any of the following
reasons:
(A) Pursuant to Section 14043.2 or 14043.36.
(B) For lack of a license necessary to perform the health care
services or to provide the goods, supplies, or merchandise directly
or indirectly to a Medi-Cal beneficiary, within the applicable
provider of service category or subgroup of that category.
(C) The period of time during which an applicant or provider has
been barred from reapplying has not passed.
(D) For other stated reasons authorized by law.
(g) Notwithstanding subdivision (f), within 90 days after
receiving an application package submitted pursuant to subdivision
(a) from a physician or physician group licensed by the Medical Board
of California or the Osteopathic Medical Board of California, or
from the date of the notice to that physician or physician group that
does not qualify as a preferred provider under subdivision (d), or
within 90 days after receiving a change of location form submitted
pursuant to subdivision (b), the department shall give written notice
to the applicant or provider that either paragraph (1), (2), (3), or
(4) of subdivision (f) applies, or shall on the 91st day grant the
applicant or provider provisional provider status pursuant to this
section for a period no longer than 12 months, effective from the
91st day.
(h) (1) If the application package that was noticed as incomplete
under paragraph (2) of subdivision (f) is resubmitted with all
requested information and documentation, and received by the
department within 60 days of the date on the notice, the department
shall, within 60 days of the resubmission, send a notice that any of
the following applies:
(A) The applicant or provider is being granted provisional
provider status for a period of 12 months, effective from the date on
the notice.
(B) The application package is denied for any other reasons
provided for in paragraph (4) of subdivision (f).
(C) The department is exercising its authority under Section
14043.37, 14043.4, or 14043.7 to conduct background checks,
preenrollment inspections, or unannounced visits.
(2) (A) If the application package that was noticed as
incomplete under paragraph (2) of subdivision (f) is not resubmitted
with all requested information and documentation and received by the
department within 60 days of the date on the notice, the application
package shall be denied by operation of law. The applicant or
provider may reapply by submitting a new application package that
shall be reviewed de novo.
(B) If the failure to resubmit is by a provider applying for
continued enrollment, the failure shall make the provider also
subject to deactivation of the provider's number and all of the
business addresses used by the provider to provide services, goods,
supplies, or merchandise to Medi-Cal beneficiaries.
(C) Notwithstanding subparagraph (A), if the notice of an
incomplete application package included a request for information or
documentation related to grounds for denial under Section 14043.2 or
14043.36, the applicant or provider shall not reapply for enrollment
or continued enrollment in the Medi-Cal program or for participation
in any health care program administered by the department or its
agents or contractors for a period of three years.
(i) (1) If the department exercises its authority under Section
14043.37, 14043.4, or 14043.7 to conduct background checks,
preenrollment inspections, or unannounced visits, the applicant or
provider shall receive notice, from the department, after the
conclusion of the background check, preenrollment inspection, or
unannounced visit of either of the following:
(A) The applicant or provider is granted provisional provider
status for a period of 12 months, effective from the date on the
notice.
(B) Discrepancies or failure to meet program requirements, as
prescribed by the department, have been found to exist during the
preenrollment period.
(2) (A) The notice shall identify the discrepancies or failures,
and whether remediation can be made or not, and if so, the time
period within which remediation must be accomplished. Failure to
remediate discrepancies and failures as prescribed by the department,
or notification that remediation is not available, shall result in
denial of the application by operation of law. The applicant or
provider may reapply by submitting a new application package that
shall be reviewed de novo.
(B) If the failure to remediate is by a provider applying for
continued enrollment, the failure shall make the provider also
subject to deactivation of the provider's number and all of the
business addresses used by the provider to provide services, goods,
supplies, or merchandise to Medi-Cal beneficiaries.
(C) Notwithstanding subparagraph (A), if the discrepancies or
failure to meet program requirements, as prescribed by the director,
included in the notice were related to grounds for denial under
Section 14043.2 or 14043.36, the applicant or provider shall not
reapply for three years.
(j) If provisional provider status or preferred provisional
provider status is granted pursuant to this section, a provider
number shall be used by the provider for each business address for
which an application package has been approved. This provider number
shall be used exclusively for the locations for which it was
approved, unless the practice of the provider's profession or
delivery of services, goods, supplies, or merchandise is such that
services, goods, supplies, or merchandise are rendered or delivered
at locations other than the provider's business address and this
practice or delivery of services, goods, supplies, or merchandise has
been disclosed in the application package approved by the department
when the provisional provider status or preferred provisional
provider status was granted.
(k) Except for providers subject to subdivision (c) of Section
14043.47, a provider currently enrolled in the Medi-Cal program at
one or more locations who has submitted an application package for
enrollment at a new location or a change in location pursuant to
subdivision (a), or filed a change of location form pursuant to
subdivision (b), may submit claims for services, goods, supplies, or
merchandise rendered at the new location until the application
package or change of location form is approved or denied under this
section, and shall not be subject, during that period, to
deactivation, or be subject to any delay or nonpayment of claims as a
result of billing for services rendered at the new location as
herein authorized. However, the provider shall be considered during
that period to have been granted provisional provider status or
preferred provisional provider status and be subject to termination
of that status pursuant to Section 14043.27. A provider that is
subject to subdivision (c) of Section 14043.47 may come within the
scope of this subdivision upon submitting documentation in the
application package that identifies the physician providing
supervision for every three locations. If a provider submits claims
for services rendered at a new location before the application for
that location is received by the department, the department may deny
the claim.
(l) An applicant or a provider whose application for enrollment,
continued enrollment, or a new location or change in location has
been denied pursuant to this section, may appeal the denial in
accordance with Section 14043.65.
(m) (1) Upon receipt of a complete and accurate claim for an
individual nurse provider, the department shall adjudicate the claim
within an average of 30 days.
(2) During the budget proceedings of the 2006-07 fiscal year, and
each fiscal year thereafter, the department shall provide data to the
Legislature specifying the timeframe under which it has processed
and approved the provider applications submitted by individual nurse
providers.
(3) For purposes of this subdivision, "individual nurse providers"
are providers authorized under certain home- and community-based
waivers and under the state plan to provide nursing services to
Medi-Cal recipients in the recipients' own homes rather than in
institutional settings.
(n) The amendments to subdivision (b), which implement a change
of location form, and the addition of paragraph (2) to subdivision
(c), the amendments to subdivision (e), and the addition of
subdivision (g), which prescribe different processing timeframes for
physicians and physician groups, as contained in Chapter 693 of the
Statutes of 2007, shall become operative on July 1, 2008.
SEC. 23. SEC. 25. Section 14043.28
of the Welfare and Institutions Code is amended to read:
14043.28. (a) (1) If an application package is denied under
Section 14043.26 or provisional provider status or preferred
provisional provider status is terminated under Section 14043.27, the
applicant or provider is prohibited from reapplying for enrollment
or continued enrollment in the Medi-Cal program or for participation
in any health care program administered by the department or its
agents or contractors for a period of three years from the date the
application package is denied or the provisional provider status is
terminated, or from the date of the final decision following an
appeal from that denial or termination, except as provided otherwise
in paragraph (2) of subdivision (h), or paragraph (2) of subdivision
(i), of Section 14043.26 and as set forth in this section.
(2) If the application is denied under paragraph (2) of
subdivision (h) of Section 14043.26 because the applicant failed to
resubmit an incomplete application package or is denied under
paragraph (2) of subdivision (i) of Section 14043.26 because the
applicant failed to remediate discrepancies, the applicant may
resubmit an application in accordance with paragraph (2) of
subdivision (h) or paragraph (2) of subdivision (i), respectively.
(3) If the denial of the application package is based upon a
conviction for any offense or for any act included in Section
14043.36 or termination of the provisional provider status or
preferred provisional provider status is based upon a conviction for
any offense or for any act included in paragraph (1) of subdivision
(c) of Section 14043.27, the applicant or provider is prohibited from
reapplying for enrollment or continued enrollment in the Medi-Cal
program or for participation in any health care program administered
by the department or its agents or contractors for a period of 10
years from the date the application package is denied or the
provisional provider status or preferred provisional provider status
is terminated or from the date of the final decision following an
appeal from that denial or termination.
(4) If the denial of the application package is based upon two or
more convictions for any offense or for any two or more acts included
in Section 14043.36 or termination of the provisional provider
status or preferred provisional provider status is based upon two or
more convictions for any offense or for any two acts included in
paragraph (1) of subdivision (c) of Section 14043.27, the applicant
or provider shall be permanently barred from enrollment or continued
enrollment in the Medi-Cal program or for participation in any health
care program administered by the department or its agents or
contractors.
(5) The prohibition in paragraph (1) against reapplying for three
years shall not apply if the denial of the application or termination
of provisional provider status or preferred provisional provider
status is based upon any of the following:
(A) The grounds provided for in paragraph (4), or subparagraph (B)
of paragraph (7), of subdivision (c) of Section 14043.27.
(B) The grounds provided for in subdivision (d) of Section
14043.27, if the investigation is closed without any adverse action
being taken.
(C) The grounds provided for in paragraph (6) of subdivision (c)
of Section 14043.27. However, the department may deny reimbursement
for claims submitted while the provider was noncompliant with CLIA.
(b) (1) If an application package is denied under subparagraph
(A), (B), or (D) of paragraph (4) of subdivision (f) of Section
14043.26, or with respect to a provider described in subparagraph (B)
of paragraph (2) of subdivision (h), or subparagraph (B) of
paragraph (2) of subdivision (i), of Section 14043.26, or provisional
provider status or preferred provisional provider status is
terminated based upon any of the grounds stated in subparagraph (A)
of paragraph (7), or paragraphs (1), (2), (3), (5), and (8) to (12),
inclusive, of subdivision (c) of Section 14043.27, all business
addresses of the applicant or provider shall be deactivated and the
applicant or provider shall be removed from enrollment in the
Medi-Cal program by operation of law.
(2) If the termination of provisional provider status is based
upon the grounds stated in subdivision (d) of Section 14043.27 and
the investigation is closed without any adverse action being taken,
or is based upon the grounds in subparagraph (B) of paragraph (7) of
subdivision (c) of Section 14043.27 and the applicant or provider
obtains the appropriate license, permits, or approvals covering the
period of provisional provider status, the termination taken pursuant
to subdivision (c) of Section 14043.27 shall be rescinded, the
previously deactivated provider numbers shall be reactivated, and the
provider shall be reenrolled in the Medi-Cal program, unless there
are other grounds for taking these actions.
(c) Claims that are submitted or caused to be submitted by an
applicant or provider who has been suspended from the Medi-Cal
program for any reason or who has had its provisional provider status
terminated or had its application package for enrollment or
continued enrollment denied and all business addresses deactivated
may not be paid for services, goods, merchandise, or supplies
rendered to Medi-Cal beneficiaries during the period of suspension or
termination or after the date all business addresses are
deactivated.
SEC. 24. SEC. 26. Section 14043.29
of the Welfare and Institutions Code is amended to read:
14043.29. (a) If, at the end of the period for which provisional
provider status or preferred provisional provider status was granted
under Section 14043.26, all of the following conditions are met, the
provisional status shall cease and the provider shall be enrolled in
the Medi-Cal program without designation as a provisional provider:
(1) The provider has demonstrated an appropriate volume of
business.
(2) The provisional provider status or preferred provisional
provider status has not been terminated or if it has been terminated,
the act of termination was rescinded.
(3) The provider continues to meet the standards for enrollment in
the Medi-Cal program as set forth in this article and Section 51000
and following of Title 22 of the California Code of Regulations.
(b) (1) An applicant or a provider who applied for enrollment or
continued enrollment in the Medi-Cal program, prior to May 1, 2003,
and for whom the application has not been approved or denied, or who
has not received a notice on or before January 1, 2004, that the
department is exercising its authority under Section 14043.37,
14043.4, or 14043.7 to conduct background checks, preenrollment
inspections, or unannounced visits, shall be granted provisional
provider status effective on January 1, 2004. Applications from
applicants or providers who have been so noticed prior to January 1,
2004, shall be processed in accordance with subdivision (h) of
Section 14043.26.
(2) Applications from applicants or providers that have been
received by the department after May 1, 2003, but prior to January 1,
2004, shall be processed in accordance with Section 14043.26, except
that these application packages shall be deemed to have been
received by the department on January 1, 2004.
SEC. 25. SEC. 27. Section 14115.8 of
the Welfare and Institutions Code is amended to read:
14115.8. (a) (1) The department shall amend the Medicaid state
plan with respect to the billing option for services by local
educational agencies, to ensure that schools shall be reimbursed for
all eligible services that they provide that are not precluded by
federal requirements.
(2) The department shall examine methodologies for increasing
school participation in the Medi-Cal billing option for local
educational agencies so that schools can meet the health care needs
of their students.
(3) The department, to the extent possible shall simplify claiming
processes for local educational agency billing.
(4) The department shall eliminate and modify state plan and
regulatory requirements that exceed federal requirements when they
are unnecessary.
(b) If a rate study for the LEA Medi-Cal billing option is
completed pursuant to Section 52 of Chapter 171 of the Statutes of
2001, the department, in consultation with the entities named in
subdivision (c), shall implement the recommendations from the study,
to the extent feasible and appropriate.
(c) In order to assist the department in formulating the state
plan amendments required by subdivisions (a) and (b), the department
shall regularly consult with the State Department of Education,
representatives of urban, rural, large and small school districts,
and county offices of education, the local education consortium, and
local education agencies. It is the intent of the Legislature that
the department also consult with staff from Region IX of the federal
Centers for Medicare and Medicaid Services, experts from the fields
of both health and education, and state legislative staff.
(d) Notwithstanding any other provision of law, or any other
contrary state requirement, the department shall take whatever action
is necessary to ensure that, to the extent there is capacity in its
certified match, a local educational agency shall be reimbursed
retroactively for the maximum period allowed by the federal
government for any department change that results in an increase in
reimbursement to local educational agency providers.
(e) The department may undertake all necessary activities to
recoup matching funds from the federal government for reimbursable
services that have already been provided in the state's public
schools. The department shall prepare and take whatever action is
necessary to implement all regulations, policies, state plan
amendments, and other requirements necessary to achieve this purpose.
(f) The department shall file an annual report with the
Legislature that shall include at least all of the following:
(1) A copy of the annual comparison required by subdivision (i).
(2) A state-by-state comparison of school-based Medicaid total and
per eligible child claims and federal revenues. The comparison shall
include a review of the most recent two years for which completed
data is available.
(3) A summary of department activities and an explanation of how
each activity contributed toward narrowing the gap between California'
s per eligible student federal fund recovery and the per student
recovery of the top three states.
(4) A listing of all school-based services, activities, and
providers approved for reimbursement by the federal Centers for
Medicare and Medicaid Services in other state plans that are not yet
approved for reimbursement in California's state plan and the service
unit rates approved for reimbursement.
(5) The official recommendations made to the department by the
entities named in subdivision (c) and the action taken by the
department regarding each recommendation.
(6) A one-year timetable for state plan amendments and other
actions necessary to obtain reimbursement for those items listed in
paragraph (4).
(7) Identify any barriers to local educational agency
reimbursement, including those specified by the entities named in
subdivision (c), that are not imposed by federal requirements, and
describe the actions that have been, and will be, taken to eliminate
them.
(g) (1) These activities shall be funded and staffed by
proportionately reducing federal Medicaid payments allocable to local
educational agencies for the provision of benefits funded by the
federal Medicaid program under the billing option for services by
local educational agencies specified in this section. Moneys
collected as a result of the reduction in federal Medicaid payments
allocable to local educational agencies shall be deposited into the
Local Educational Agency Medi-Cal Recovery Fund, which is hereby
established in the Special Deposit Fund established pursuant to
Section 16370 of the Government Code. These funds shall be used, upon
appropriation by the Legislature, only to support the department to
meet all the requirements of this section. As of January 1, 2013,
unless the Legislature enacts a new statute or extends the repeal
date in subdivision (j), all funds in the Local Educational Agency
Medi-Cal Recovery Fund shall be returned proportionally to all local
educational agencies whose federal Medicaid funds were used to create
this fund. The annual amount funded shall not exceed one million
five hundred thousand dollars ($1,500,000).
(2) Funding received pursuant to paragraph (1) shall derive only
from federal Medicaid funds that exceed the baseline amount of local
educational agency Medicaid billing option revenues for the 2000-01
fiscal year.
(h) (1) The department may enter into a sole source contract to
comply with the requirements of this section.
(2) The level of additional staff to comply with the requirements
of this section, including, but not limited to, staff for which the
department has contracted for pursuant to paragraph (1), shall be
limited to that level that can be funded with revenues derived
pursuant to subdivision (g).
(i) The activities of the department shall include all of the
following:
(1) An annual comparison of the school-based Medicaid systems in
comparable states.
(2) Efforts to improve communications with the federal government,
the State Department of Education, and local educational agencies.
(3) The development and updating of written guidelines to local
educational agencies regarding best practices to avoid audit
exceptions, as needed.
(4) The establishment and maintenance of a local educational
agency friendly interactive Web site.
(j) This section shall remain in effect only until January 1,
2013, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2013, deletes or extends
that date.