BILL ANALYSIS
SENATE HEALTH
COMMITTEE ANALYSIS
Senator Elaine K. Alquist, Chair
BILL NO: AB 2173
A
AUTHOR: Beall
B
AMENDED: May 28, 2010
HEARING DATE: June 23, 2010
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REFERRAL: Public Safety
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CONSULTANT:
7
Tadeo/
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SUBJECT
Emergency air medical transportation providers: penalty
levy: reimbursement augmentation
SUMMARY
Establishes a $3 flat fee on each Vehicle Code violation in
the state, except for parking tickets, which would be
augmented with matching federal funds, to provide for
increased Medi-Cal funding of emergency air ambulance
transportation.
CHANGES TO EXISTING LAW
Existing federal law:
Establishes the Medicaid program to provide comprehensive health
benefits to specified groups of low-income persons.
Existing state law:
Establishes the Medi-Cal program, the state's Medicaid
program, administered by the Department of Health Care
Services (DHCS), which provides comprehensive health
benefits to low-income children; their parents or caretaker
relatives; pregnant women; elderly, blind or disabled
persons; nursing home residents and refugees.
Continued---
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Establishes fines, which are imposed by the courts, for
criminal offenses, including offenses involving a violation
of the Vehicle Code. Establishes over 269 penalty
assessments in addition to the base fines. Significant
assessments that apply to a Vehicle Code violation are as
follows:
State Penalty Assessment of $10 for every $10 on
every fine, penalty or forfeiture. Of the funds
collected, 70 percent goes to the state and 30 percent
to the county. The state portion is distributed to
the Fish and Game Preservation Fund, the Restitution
Fund, the Peace Officers Training Fund, the Driver
Training Penalty Assessment Fund, the Corrections
Training Fund, the Local Public Prosecutors and Public
Defenders Fund, the Victim-Witness Assistance Fund,
and the Traumatic Brain Injury Fund.
County Penalty Assessment of $7 for every $10 on
every fine, penalty, or forfeiture imposed and
collected. The proceeds are distributed to funds
established by the county board of supervisors:
including a Courthouse Construction Fund, Criminal
Justice Facilities Construction Fund, Automated
Fingerprint Identification Fund, Emergency Medical
Services Fund, and, DNA Fund.
State Surcharge of 20 percent on every base fine
collected by the court, deposited in the General Fund.
State Court Facilities Construction Penalty
Assessment of up to $5 for every $10 or fraction
thereof, upon every fine, penalty or forfeiture
collected by the courts for criminal offenses.
Court Security Fee of $35 on every conviction for a
criminal offense for court security.
Proposition 69 levy of $1 penalty assessment on
every $10 in fines and forfeitures resulting from
criminal and traffic offenses and for state and local
governments for DNA databank implementation purposes.
Immediate and Critical Needs Account within the
existing State Court Facilities Construction Fund
consisting of an additional $30 for every felony or
misdemeanor criminal conviction and $35 for every
criminal infraction, including traffic offenses, but
not including parking offenses.
The Maddy EMS Fund which permits each county to
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levy a $2 penalty assessment for each $10 of traffic
fines to provide supplemental financing for local
emergency medical services. Ten percent is deducted
for administration, and the remainder is distributed
to physicians for uncompensated emergency room care,
to trauma centers, and hospitals and to counties for
county emergency medical services.
Emergency medical services (EMS) assessment of an
additional 20 percent assessment of $2 for every $10
on every fine, penalty, forfeiture or criminal offense
and all offenses dealing with the Vehicle Code except
parking offenses for EMS.
This bill:
Establishes the Emergency Air Medical Transportation Act
(EAMTA).
Imposes a penalty of $3 on every conviction of a violation
of the Vehicle Code, or a local ordinance adopted pursuant
to the Vehicle Code, except parking offenses. Requires the
penalty to be in addition to the established penalty, and
excluded from the base fine or any other surcharges used to
calculate any other penalties.
Establishes the EAMTA Fund, to be administered by DHCS, and
requires each county to deposit the proceeds of this
penalty in a County Emergency Air Medical Transportation
Act fund and to transfer the funds on a quarterly basis to
the EAMTA Fund.
Requires the EAMTA Fund to be available, upon appropriation
by the Legislature, to DHCS to augment emergency air
medical transportation reimbursement payments made through
the Medi-Cal program, and to reimburse DHCS, the courts,
and each county for its administrative costs.
States legislative intent and makes declarations regarding
air ambulance service, current reimbursement rates, fines
and penalties and the relationships to Vehicle Code
violations.
FISCAL IMPACT
According to the Assembly Appropriations Committee analysis
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of AB 2173, potential increased revenue in the range of $40
million, assuming no diminishing returns as a result of
changes in judicial behavior, collections, or ability to
pay.
BACKGROUND AND DISCUSSION
The author argues that this bill is needed to provide
supplemental payments to air ambulance providers. The
author states that emergency air ambulance services provide
coverage to multiple counties within a 100-mile radius of
their bases, and as a result, transports often originate in
a county other than where they are based, which makes it
impossible for them to be funded by local tax support
except in the geographically largest of counties. The
author points out that Medi-Cal pays air ambulance services
far below the cost of providing emergency air
transportation, only 40 percent of Medicare rates in
California overall and below 35 percent in rural areas; and
nothing if the patient is indigent. The author also notes
that air ambulance providers are not covered by other
supplemental emergency payment funds that are collected
from fines and penalties. They also do not receive any
type of disproportionate share provider supplemental
payments. The author contends that AB 2173 would provide
critical funding for this essential life-saving service.
Air ambulance services
Air ambulance services provide emergency transportation for
the most critical patients from accident scenes directly to
trauma centers. According to a Foundation for Air-Medical
Research and Education (FARE) 2006 report, the most
serious car accidents are located in rural areas, where 60
percent of fatal car accidents occur, a rate double that of
similar accidents in suburban or urban areas. The FARE
report also states that the closure of rural hospitals in
recent years has created large geographical gaps in the
availability of specialized surgical resources.
Helicopter ambulances provide medical care at an advanced
life support level, and conduct specialty care transports.
Helicopters are used for the transport of patients from the
scene of an injury to a hospital, for flights between
hospitals, and from rural areas and urban acute care
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hospitals to trauma centers, heart/stroke centers, burn
units, and children's specialty hospitals. Medical care is
provided in fixed wing ambulances (airplanes) on longer
inter-hospital flights when the closest appropriate medical
facility is either inaccessible, difficult to reach, or
distantly located. The FARE report approximates that a
half-million air ambulance transports are conducted each
year.
These patient transports are overseen by referring
physicians and receiving specialist physicians using
guidelines developed by the National Association of EMS
Physicians, the Air Medical Physician Association, and the
Association of Air Medical Services.
Air ambulance services are also used for disaster response.
In times of either man made or natural disaster, air
ambulance services provide highly experienced resources
that can be rapidly deployed. Air ambulance service
providers are comprised of a mix of public and private
entities. For example, the City of Los Angeles provides
its own services, whereas the California Shock Trauma Air
Rescue (CALSTAR) is a non- profit community-based provider
that provides services throughout Central and Northern
California.
Private air ambulance services are reimbursed by
third-party payers in the same fashion as other health care
services. According to information provided by CALSTAR
based on May 31, 2007 audited financial statements, the
average private insurance payment for air ambulance
services between June 1, 2006 and May 31, 2007 was $20,795;
the average Medicare payment was $5,400, and the average
Medi-Cal payment was $2,838.
Medi-Cal rates for air ambulance transportation were set in
1993, and have not received an increase. According to a
March 28, 2008 Med-Cal rate history table for 1985 - 2001,
provided by the sponsor of AB 2173, the history of Medi-Cal
rate increases for related emergency medical care services
have been as follows:
For Fiscal Year (FY)1998/99, ground ambulance
medical transportation received a 47.8 percent
emergency base rate increase (responding to car
accidents, other emergencies) and a 55.5 percent
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non-emergency base rate increase (scheduled patient
transport to a hospital, for example), resulting in a
total increase of 37.9 percent. Mileage rates were
not adjusted.
For FY 1999/00, ground ambulance medical
transportation received an ambulance base rate/mileage
rate adjustment of 11.7 percent.
ER Physicians also received an increase of 25
percent in 1997/98, and an increase of 16.7 percent in
2000/01.
Penalty assessments
The Legislature has increasingly turned to penalty
assessments on criminal and traffic offenses as a method of
raising revenue for various projects. Currently, the
amount of assessments on individuals who commit traffic
violations is almost quadruple the base fine. For example:
The fine for speeding up to 15 MPH over the 65 MPH
limit has a base penalty of $35, but amounts to $111
after additional penalties and assessments are
applied;
The fine for driving without insurance has a base
penalty of $200, but amounts to $825 after additional
penalties and assessments are applied;
The fine for driving under the influence has a base
penalty of $390, but amounts to $1,547 after
additional penalties and assessments are applied; and,
The fine for transport of hazardous materials has a
base penalty of $300, but amounts to $1,205 after
additional penalties and assessments are applied.
According to a February 2006 California Research Bureau
(CRB) study, in counties in which the data was available,
the majority of penalties and assessments collected were
from Vehicle Code violations. The study noted that, many
criminal defendants who commit serious offenses under the
Penal Code, are unlikely to have the ability to pay any
fines assessed in addition to other punishments, such as
county jail or state prison sentences.
The study also noted that, as penalty assessments can
almost quadruple the base fine, increasing fines and
assessments may have the unintended consequence of reduced
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fine collections. Indigent defendants facing increasing
fees may simply choose to spend time in jail in lieu of
paying the fine, causing taxpayers to pay the jail costs
while state and local governments receive reduced penalty
funds. Moreover, county jail population caps may provide
additional incentives to opt for jail time over fines, as
the time served for nonviolent offenders may be minimal.
The CRB notes that the end result may be that a substantial
amount of fines, fees, and revenue is not collected.
Arguments in support
According to the California Chapter of the Association of
Air Ambulance Medical Services (Cal-AAMS), sponsor of AB
2173, air ambulances provide an essential service to the
community and provide life-saving emergency transports to
trauma and cardiac patients without any form of health
insurance. Cal-AAMS states that air ambulance medical
transportation has not had a rate change since 1993, at
which time the rate was decreased. Cal-AAMS adds private
insurance providers have recently instituted a national
policy to review the rates paid to air providers as
compared to rates paid by public providers. Cal-AAMS
contends that properly funding air ambulance services is
essential to maintaining the integrity of our EMS system.
Proponents of AB 2173 argue that this bill would provide
for increases in funding of emergency air ambulance
transportation, without any impact on the general fund
The Regional Council of Rural Counties adds that, given the
vast distances between hospital or trauma facilities, and
the range of geographic barriers facing land-based
transportation, access to air ambulance services is
commonly a matter of life or death in rural areas.
The California Hospital Association argues that California
cannot afford for critical air ambulance services to be
reduced and that, without AB 2173 more air ambulance
companies are likely to reduce or eliminate services.
Arguments in opposition
The Automobile Club of Southern California and the
California State Automobile Association, collectively known
as the AAA Clubs, point out that 70 to 80 percent of
penalty assessment revenue is generated from Vehicle Code
moving violations. The AAA Clubs note that the original
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purpose of penalty assessments was to fund driver's
training. The AAA Clubs argue that while air medical
transportation is a necessary and laudable program, funding
through assessments on Vehicle Code violations place a
disproportionate burden upon the motoring public.
The California Teamsters Public Affairs Council contends
that the cost of citations has risen dramatically in recent
years and that the citations are now unaffordable for
working Californians, falling disproportionately on the
shoulders of commercial drivers.
Related bills
AB 1174 (Hernandez) requires Medi-Cal to cover ambulance
services when a patient reasonably believes that without an
ambulance a serious health condition, as specified, might
result; increases and establishes in statute maximum
Medi-Cal reimbursement rates for ambulance transportation
services. This bill is on the Assembly Appropriations
Committee suspense file.
AB 511 (De La Torre) AB 511 would impose a 5.5 percent
quality assurance fee on ambulance transportation services
providers through June 30, 2016, for purposes of increasing
reimbursement rates paid by Medi-Cal for services rendered
to Medi-Cal beneficiaries. This bill is scheduled to be
heard in Senate Health Committee on June 30, 2010.
Prior legislation
SB 13 X4, (Ducheny), Chapter 22, Statutes of 2009,
increases various court user fees, including an increase of
$10 in the court security fee, an increase of $5 in the
court reporter fee, and an increase of $10 for various
post-judgment fees. The court security fee increase
sunsets on July 1, 2011.
AB 1153 (Torrico) of 2009, would have established a $3
penalty assessment on all Vehicle Code violations, except
parking offenses, to provide a funding source to augment
Medi-Cal reimbursement for air ambulance services. This
bill failed in the Assembly Appropriations Committee.
AB 1407 (Perata), Statutes of 2008, Chapter 311, allows the
issuance of up to $5 billion in lease-revenue bonds to
finance the construction of critical needs courthouse
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construction projects, and supports the debt service for
the bonds by raising specified criminal and civil fees and
fines.
PRIOR ACTIONS
Assembly Health: 15-2
Assembly Appropriations:17-0
Assembly Floor: 65-8
COMMENTS
1. Double referral. This bill has also been referred to
the Senate Committee on Public
Safety.
2. Is there a balance between who pays and who benefits?
Although a very high percentage of air ambulance flights
are in direct response to traffic accidents, most of these
accident transports still take place by ground ambulance.
Air ambulance services also include the transfer of
patients who have first been taken to a smaller rural
hospital and are then referred to an urban trauma center.
Air ambulance services are also used in emergency
situations to avoid ground traffic congestion often due to
accidents. Does this bill result in a penalty assessment
that is paid for by all Californians who commit vehicle
code violations, particularly in urban areas, but which
pays for services that are primarily used by those who must
be transferred from a rural area, or in less common cases
involving urban traffic congestion problems?
POSITIONS
Support: California Chapter of the Association of Air
Medical Services (sponsor)
Barton Health
Board for Critical Care Transport Paramedic
Certification
CDF Firefighters Local 2881
California Children's Hospital Association
California Hospital Association
Cal-Ore Life Flight
Congressman Dennis A. Cardoza
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Diamond Springs - El Dorado Fire Protection District
Hall Critical Care Transport
John C. Fremont Healthcare District
Mercy Air
Mercy Flights, Inc.
Mercy Medical Center Mt. Shasta
Olivehurst Fire Department
Oregon State Ambulance Association
Patterson District Ambulance
Placer Hills Fire Protection District
PHI Air Medical California
Reach Air Medical Services
Regional Council of Rural Counties
Trinity County Life Support
Upland Fire Department
West Side Community Ambulance
Two individuals
Oppose: Automobile Club of Southern California
California State Automobile Association
California Teamsters Public Affairs Council
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