BILL NUMBER: SB 726 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Ashburn
FEBRUARY 27, 2009
An act to amend Sections 2401 and 2401.1 of the Business and
Professions Code, relating to medicine.
LEGISLATIVE COUNSEL'S DIGEST
SB 726, as introduced, Ashburn. Hospitals: employment of
physicians and surgeons.
Existing law, the Medical Practice Act, restricts the employment
of licensed physicians and surgeons and podiatrists by a corporation
or other artificial legal entity, subject to specified exemptions.
Existing law establishes, until January 1, 2011, a pilot project to
allow qualified district hospitals, as defined, to employ a physician
and surgeon, if the hospital does not interfere with, control, or
otherwise direct the professional judgment of the physician and
surgeon. The pilot project authorizes the direct employment of a
total of 20 physicians and surgeons by those hospitals, and specifies
that each qualified district hospital may employ up to 2 physicians
and surgeons, subject to certain requirements. Existing law requires
the Medical Board of California to report to the Legislature not
later than October 1, 2008, on the effectiveness of the pilot
project.
This bill would revise the pilot project to authorize the direct
employment by general acute care hospitals meeting specified
requirements of an unlimited number of physicians and surgeons under
the pilot project, and would authorize such a hospital to employ up
to 5 licensees at a time. The bill would extend the pilot project
until January 1, 2016, would require the board to report to the
Legislature not later than October 1, 2013, on the evaluation of the
effectiveness of the pilot project, and would make conforming
changes.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature hereby finds and declares that a 2001
University of California, San Francisco, study found that the Inland
Empires, Central Valley/Sierra Nevada, and South Valley/Sierra Nevada
regions have at least 30 percent fewer physicians and surgeons than
the Los Angeles and San Francisco Bay area regions.
SEC. 2. Section 2401 of the Business and Professions Code is
amended to read:
2401. (a) Notwithstanding Section 2400, a clinic operated
primarily for the purpose of medical education by a public or private
nonprofit university medical school, which is approved by the
Division of Licensing or the Osteopathic Medical Board of California,
may charge for professional services rendered to teaching patients
by licensees who hold academic appointments on the faculty of the
university, if the charges are approved by the physician and surgeon
in whose name the charges are made.
(b) Notwithstanding Section 2400, a clinic operated under
subdivision (p) of Section 1206 of the Health and Safety Code may
employ licensees and charge for professional services rendered by
those licensees. However, the clinic shall not interfere with,
control, or otherwise direct the professional judgment of a physician
and surgeon in a manner prohibited by Section 2400 or any other
provision of law.
(c) Notwithstanding Section 2400, a narcotic treatment program
operated under Section 11876 of the Health and Safety Code and
regulated by the State Department of Alcohol and Drug Programs, may
employ licensees and charge for professional services rendered by
those licensees. However, the narcotic treatment program shall not
interfere with, control, or otherwise direct the professional
judgment of a physician and surgeon in a manner prohibited by Section
2400 or any other provision of law.
(d) Notwithstanding Section 2400, a qualified hospital
owned and operated by a health care district pursuant to
Division 23 (commencing with Section 32000) of the Health and Safety
Code may employ a licensee pursuant to Section 2401.1, and
may charge for professional services rendered by the licensee, if the
physician and surgeon in whose name the charges are made approves
the charges. However, the hospital shall not interfere with, control,
or otherwise direct the physician and surgeon's professional
judgment in a manner prohibited by Section 2400 or any other
provision of law.
SEC. 3. Section 2401.1 of the Business and Professions Code is
amended to read:
2401.1. (a) The Legislature finds and declares as follows:
(1) Due to the large number of uninsured and underinsured
Californians, a number of California communities are having great
difficulty recruiting and retaining physicians and surgeons.
(2) In order to recruit physicians and surgeons to provide
medically necessary services in rural and medically underserved
communities, many district hospitals have no
viable alternative but to directly employ physicians and surgeons in
order to provide economic security adequate for a physician and
surgeon to relocate and reside in their communities.
(3) The Legislature intends that a district
hospital meeting the conditions set forth in this section be able to
employ physicians and surgeons directly, and to charge for their
professional services.
(4) The Legislature reaffirms that Section 2400 provides an
increasingly important protection for patients and physicians and
surgeons from inappropriate intrusions into the practice of medicine,
and further intends that a district hospital not
interfere with, control, or otherwise direct a physician and surgeon'
s professional judgment.
(b) A pilot project to provide for the direct employment of
a total of 20 physicians and surgeons by qualified
district hospitals is hereby established in order
to improve the recruitment and retention of physicians and surgeons
in rural and other medically underserved areas.
(c) For purposes of this section, a qualified district
hospital means a hospital that meets all
both of the following requirements:
(1) Is a district hospital organized and governed pursuant to the
Local Health Care District Law (Division 23 (commencing with Section
32000) of the Health and Safety Code).
(2) Provides a percentage of care to Medicare, Medi-Cal, and
uninsured patients that exceeds 50 percent of patient days.
(3) Is located in a county with a total population of less than
750,000.
(4) Has net losses from operations in fiscal year 2000-01, as
reported to the Office of Statewide Health Planning and Development.
(1) Is a general acute care hospital, as defined in Section 1250
of the Health and Safety Code.
(2) Is located within a medically underserved population,
medically underserved area, or health professions shortage area, so
designated by the federal government pursuant to Section 254b,
254c-14, or 254e of Title 42 of the United States Code, or is a rural
hospital as defined in Section 124840 of the Health and Safety Code.
(d) In addition to the requirements of subdivision (c), and in
addition to other applicable laws, a qualified district
hospital may directly employ a licensee pursuant to
subdivision (b) if all of the following conditions are satisfied:
(1) The total number of physicians and surgeons employed by all
qualified district hospitals under this section does not exceed 20.
(2)
(1) The medical staff and the elected trustees of the
qualified district hospital concur by an
affirmative vote of each body that the physician and surgeon's
employment is in the best interest of the communities served by the
hospital.
(3)
(2) The licensee enters into or renews a written
employment contract with the qualified district
hospital prior to December 31, 2006 2011
, for a term not in excess of four years. The contract shall
provide for mandatory dispute resolution under the auspices of the
board for disputes directly relating to the licensee's clinical
practice.
(4)
(3) The total number of licensees employed by the
qualified district hospital does not exceed
two five at any time.
(5)
(4) The qualified district hospital
notifies the board in writing that the hospital plans to enter into a
written contract with the licensee, and the board has confirmed that
the licensee's employment is within the maximum number permitted by
this section. The board shall provide written confirmation to the
hospital within five working days of receipt of the written
notification to the board.
(e) The board shall report to the Legislature not later than
October 1, 2008 2013 , on the
evaluation of the effectiveness of the pilot project in improving
access to health care in rural and medically underserved areas and
the project's impact on consumer protection as it relates to
intrusions into the practice of medicine.
(f) Nothing in this section shall exempt the district
hospital from any reporting requirements or affect the
board's authority to take action against a physician and surgeon's
license.
(g) This section shall remain in effect only until January 1,
2011 2016 , and as of that date is
repealed, unless a later enacted statute that is enacted before
January 1, 2011 2016 , deletes or
extends that date.