BILL ANALYSIS Ó AB 641 Page 1 Date of Hearing: May 18, 2011 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair AB 641 (Feuer) - As Amended: May 10, 2011 Policy Committee: JudiciaryVote:7-2 Health Vote: 13-4 Urgency: No State Mandated Local Program: No Reimbursable: No SUMMARY This bill implements several recommendations related to a recent state audit of penalty accounts within the Department of Public Health (DPH). Specifically, this bill: 1)Streamlines the citation appeals process for long-term health care facilities (LTC facilities) by eliminating Citation Review Conferences (CRCs). 2)Increases the maximum fine for Class "B" citations for LTC facilities. 3)Allows fines to be levied from both state and federal agencies when an incident at a LTC facility violates both state and federal laws. FISCAL EFFECT 1)The elimination of CRCs will likely have a minimal fiscal impact on DPH operations. DPH indicates the total annual costs for CRCs are $470,000, but that staff is redirected from other priority assignments in order to complete work for CRCs. Eliminating CRCs would free up staff resources within the Licensing and Certification program to focus on other activities, some of which currently have a backlog. 2)Estimated increased penalty revenues from increasing the maximum penalty for a Class B citation in the range of $400,000- $800,000. COMMENTS AB 641 Page 2 1)Rationale . According to the author, the current citation review conference (CRC) process is inefficient and ineffective. CRC appeals can sometimes take years, and due to appeals, the CRC process rarely provide a means to settle cases. The author maintains that it makes sense to remove the CRC appeals process in favor of the more trusted appeals processes in existing law, such as an administrative law judge or a California Superior Court. The author further argues that Class "B" citations for LTC facilities have not been modified since 1985, and can include fairly serious incidents. The author maintains that the current maximum penalty of $1,000 does not reflect the gravity of the worst Class "B" incidents, such as serious pest infestations or sexual abuse, and that the department should have the ability in these cases to levy a penalty of $2,000. The author also argues that California is one of a few states that bars a monetary penalty from both a state and federal agency when a LTC facility action involves noncompliance with both a state and federal law. The author asserts that it makes sense to allow both entities to act if the laws of either were violated. According to the author, there are no requirements in this bill that such levies should be done for each and every citation and this bill provides DPH with the discretion to cite a higher penalty for the most egregious violations. 2)Recent State Auditor's Report . A recent state audit made a number of findings and recommendations regarding the state's processes for issuing citations against LTC facilities, collecting penalties, and tracking related financial information. The state auditor found that a backlog of CRC appeals was impeding the state's ability to collect penalty revenue and that it could take steps to increase penalty revenue. In response to the report, DPH also made three recommendations that address the auditor's findings. This bill implements these recommendations. Analysis Prepared by : Lisa Murawski / APPR. / (916) 319-2081 AB 641 Page 3