BILL NUMBER: AB 1817	ENROLLED
	BILL TEXT

	PASSED THE SENATE  AUGUST 19, 2010
	PASSED THE ASSEMBLY  MAY 20, 2010
	AMENDED IN ASSEMBLY  APRIL 26, 2010
	AMENDED IN ASSEMBLY  APRIL 5, 2010

INTRODUCED BY   Assembly Member Arambula

                        FEBRUARY 11, 2010

   An act to add Section 5023.2 to the Penal Code, relating to
corrections.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1817, Arambula. Corrections: inmate health care.
   Existing law establishes the Department of Corrections and
Rehabilitation and charges it with various duties and obligations.
Existing law provides that it is the intent of the Legislature that
the department operate in the most cost-effective and efficient
manner possible when purchasing health care services for inmates.
Existing law provides that the department may contract with providers
of health care services and health care network providers,
including, but not limited to, health plans, preferred provider
organizations, and other health care network managers.
   This bill would require the department to maintain a statewide
utilization management program, as defined, which would include, but
not be limited to, the review, approval, and oversight of community
hospital bed usage and case management processes for high medical
risk and high medical cost patients. The bill would require the
department to develop and implement policies and procedures to ensure
that all adult prisons employ the same statewide utilization
management program. The bill would require the department to
establish annual quantitative utilization management performance
objectives and to report to specified legislative committees on,
among other things, its success or failure in meeting those
objectives, as specified.


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

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) Between the 2003-04 and 2008-09 fiscal years, annual medical
and pharmacy contract costs for state prison inmates grew from
approximately two hundred four million dollars ($204,000,000) to more
than eight hundred forty-five million dollars ($845,000,000), at an
average annual growth rate of more than 28 percent.
   (b) Components of the cost increase specified in subdivision (a)
include a rapid increase in the use of prescription medicines,
specialty care referral rates that exceed referral rates found in
other state prison systems, and an occupancy rate of community
hospital beds that is more than double the occupancy rate for a
similar Medi-Cal population.
   (c) Controlling inmate health care costs and expenditures is one
of the Legislature's highest priorities.
   (d) The Legislature has adopted amendments to the Budget Act of
2009, in Assembly Bill 2 of the 2009-10 Eighth Extraordinary Session,
to reduce funding to the Department of Corrections and
Rehabilitation for inmate medical care by eight hundred eleven
million dollars ($811,000,000).
   (e) The department needs to implement all reasonable methods for
controlling state prison inmate health care costs, reduce year over
year health care spending, and achieve a zero growth rate in health
care expenditures.
  SEC. 2.  Section 5023.2 is added to the Penal Code, to read:
   5023.2.  (a) In order to promote the best possible patient
outcomes, eliminate unnecessary medical and pharmacy costs, and
ensure consistency in the delivery of health care services, the
department shall maintain a statewide utilization management program
that shall include, but not be limited to, all of the following:
   (1) Objective, evidence-based medical necessity criteria and
utilization guidelines.
   (2) The review, approval, and oversight of referrals to specialty
medical services.
   (3) The management and oversight of community hospital bed usage
and supervision of health care bed availability.
   (4) Case management processes for high medical risk and high
medical cost patients.
   (5) A preferred provider organization (PPO) and related contract
initiatives that improve the coverage, resource allocation, and
quality of contract medical providers and facilities.
   (b) The department shall develop and implement policies and
procedures to ensure that all adult prisons employ the same statewide
utilization management program established pursuant to subdivision
(a) that supports the department's goals for cost-effective auditable
patient outcomes, access to care, an effective and accessible
specialty network, and prompt access to hospital and infirmary
resources. The department shall provide a copy of these policies and
procedures, by July 1, 2011, to the Joint Legislative Budget
Committee, the Senate Committee on Appropriations, the Senate
Committee on Budget and Fiscal Review, the Senate Committee on
Health, the Senate Committee on Public Safety, the Assembly Committee
on Appropriations, the Assembly Committee on Budget, the Assembly
Committee on Health, and the Assembly Committee on Public Safety.
   (c) (1) The department shall establish annual quantitative
utilization management performance objectives to promote greater
consistency in the delivery of contract health care services, enhance
health care quality outcomes, and reduce unnecessary referrals to
contract medical services. On July 1, 2011, the department shall
report the specific quantitative utilization management performance
objectives it intends to accomplish statewide in each adult prison
during the next 12 months to the Joint Legislative Budget Committee,
the Senate Committee on Appropriations, the Senate Committee on
Budget and Fiscal Review, the Senate Committee on Health, the Senate
Committee on Public Safety, the Assembly Committee on Appropriations,
the Assembly Committee on Budget, the Assembly Committee on Health,
and the Assembly Committee on Public Safety.
   (2) The requirement for submitting a report imposed under this
subdivision is inoperative on January 1, 2015, pursuant to Section
10231.5 of the Government Code.
   (d) On March 1, 2012, and each March 1 thereafter, the department
shall report all of the following to the Joint Legislative Budget
Committee, the Senate Committee on Appropriations, the Senate
Committee on Budget and Fiscal Review, the Senate Committee on
Health, the Senate Committee on Public Safety, the Assembly Committee
on Appropriations, the Assembly Committee on Budget, the Assembly
Committee on Health, and the Assembly Committee on Public Safety:
   (1) The extent to which the department achieved the statewide
quantitative utilization management performance objectives set forth
in the report issued the previous March as well as the most
significant reasons for achieving or not achieving those performance
objectives.
   (2) A list of adult prisons that achieved and a list of adult
prisons that did not achieve its quantitative utilization management
performance objectives and the significant reasons for the success or
failure in achieving those performance objectives at each adult
state prison.
   (3) The specific quantitative utilization management performance
objectives the department and each adult state prison intends to
accomplish in the next 12 months.
   (4) A description of planned and implemented initiatives necessary
to accomplish the next 12 months' quantitative utilization
management performance objectives statewide and for each adult state
prison. The department shall describe initiatives that were
considered and rejected and the reasons for their rejection.
   (5) The costs for inmate health care for the previous fiscal year,
both statewide and at each adult state prison, and a comparison of
costs from the fiscal year prior to the fiscal year being reported
both statewide and at each adult state prison.
   (e) It is the intent of the Legislature that any activities the
department undertakes to implement the provisions of this section
shall result in no year over year net increase in state costs.
   (f) The following definitions shall apply to this section:
   (1) "Contract medical costs" mean costs associated with an
approved contractual agreement for the purposes of providing direct
and indirect specialty medical care services.
   (2) "Specialty care" means medical services not delivered by
primary care providers.
   (3) "Utilization management program" means a strategy designed to
ensure that health care expenditures are restricted to those that are
needed and appropriate by reviewing patient-inmate medical records
through the application of defined criteria or expert opinion, or
both. Utilization management assesses the efficiency of the health
care process and the appropriateness of decisionmaking in relation to
the site of care, its frequency, and its duration through
prospective, concurrent, and retrospective utilization reviews.
   (4) "Community hospital" means an institution located within a
city, county, or city and county which is licensed under all
applicable state and local laws and regulations to provide diagnostic
and therapeutic services for the medical diagnosis, treatment, and
care of injured, disabled, or sick persons in need of acute inpatient
medical, psychiatric, or psychological care.
   (g) The requirement for submitting a report imposed under
subdivision (d) is inoperative on March 1, 2016, pursuant to Section
10231.5 of the Government Code.