BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      



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          |SENATE RULES COMMITTEE            |                   AB 667|
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                                    CONSENT


          Bill No:  AB 667
          Author:   Mitchell (D), et al.
          Amended:  6/9/11 in Senate
          Vote:     21

           
           SENATE HEALTH COMMITTEE  :  8-0, 6/22/11
          AYES:  Hernandez, Strickland, Alquist, Anderson, Blakeslee, 
            De León, DeSaulnier, Wolk
          NO VOTE RECORDED:  Rubio
           
          SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8
           
          ASSEMBLY FLOOR  :  70-0, 5/12/11 - See last page for vote


           SUBJECT  :    Medi-Cal:  subacute care program

            SOURCE  :     Subacute Saratoga Hospital and the Childrens 
                      Recovery Center


           DIGEST  :    This bill establishes medical necessity 
          standards for the Medi-Cal subacute care program.

           ANALYSIS  :    

          Existing law:

          1. Establishes the Medi-Cal program, under the Department 
             of Health Care Services (DHCS), to provide comprehensive 
             health benefits to low-income children, their parents or 
             caretaker relatives, pregnant women, elderly, blind or 
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             disabled persons, nursing home residents, and refugees 
             who meet specified eligibility criteria.

          2. Establishes the Medi-Cal subacute care program in order 
             to more effectively use Medi-Cal dollars while ensuring 
             needed services for patients who meet subacute care 
             criteria.  

          3. Establishes level of care, reimbursement, scope and 
             duration of benefits, staff-to-patient ratios, and 
             standards for participation in the Medi-Cal subacute 
             care program.

          This bill:

          1. Makes various legislative findings and declarations 
             relating to subacute care hospitals, including, that 
             California has 400 children under the age of 21 who rely 
             on life-sustaining technology in 10 pediatric subacute 
             care hospitals.  

          2. Declares that the regulatory criteria related to the 
             subacute care program have not been updated since the 
             program's inception 16 years ago.
             
          3. Defines "pediatric subacute services" in the Medi-Cal 
             program as health care services needed by a person under 
             the age of 21 who uses medical technology that 
             compensates for the loss of vital bodily functions. 

          4. Requires that medical necessity for pediatric subacute 
             care must be substantiated by one of the following:

             A.    Tracheostomy with dependence on mechanical 
                ventilation for a minimum of six hours each day;

             B.    Dependence on tracheostomy care requiring 
                suctioning at least every six hours, and room air 
                mist or oxygen as needed and dependence on one of the 
                following six treatment procedures:

                (1)      Dependence on tracheostomy care requiring 
                   suctioning at least every six hours and room air 
                   mist or oxygen; 

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                (2)      Continuous intravenous therapy, as 
                   specified;

                (3)      Peritoneal dialysis;

                (4)      Tube feeding;  

                (5)      Other medical technologies that require the 
                   services of a professional nurse; or

                (6)      Biphasic Positive Airway Pressure (BiPAP) as 
                   specified and lacking cognitive or physical 
                   ability to protect the airway.

             C.    Dependence on tracheostomy care requiring 
                suctioning at least every six hours and room air mist 
                or oxygen and one of the conditions in (B) (2) 
                through (4) above;

             D.    Dependence on skilled-nursing care in the 
                administration of any three of (B) above; or, 

             E.    Dependence on BiPAP and Continuous Positive Airway 
                Pressure (CPAP), as specified, and one of the 
                conditions in (B) (1) through (6) above.

          5. Establishes that the medical necessity in this bill is 
             intended solely for the evaluation of a potential 
             eligible patient for pediatric subacute care who would 
             otherwise be receiving an acute level of care.

          6. Deletes the requirement that subacute patient care be 
             defined by DHCS based on a study established in 1980, 
             and makes other technical and clarifying changes.

           Background
           
           Medi-Cal subacute care program  .  Established in July of 
          1983, the Medi-Cal subacute care program serves patients in 
          licensed health facilities who meet subacute care criteria. 
           Pediatric subacute care is a level of care needed by a 
          person under the age of 21 who uses a medical technology 
          that compensates for the loss of a vital bodily function.  

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          Specific reimbursement rates have been developed for 
          providers of subacute care, and daily reimbursement rates 
          for subacute facilities vary depending on the type of the 
          facility and whether the patient is ventilator dependent or 
          non-ventilator dependent.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes   
          Local:  No

           SUPPORT  :   (Verified  7/11/11)

          Subacute Saratoga Hospital and the Children's Recovery 
          Center (source)
          California Hospital Association

           ARGUMENTS IN SUPPORT  :    The Subacute Saratoga Hospital and 
          the Children's Recovery Center, the sponsor of this bill, 
          writes that pediatric subacute patients are medically 
          fragile; these patients require 24-hour nursing and special 
          services such as inhalation therapy, tracheostomy care, 
          intravenous feeding tubes, and complex wound care.  Prior 
          to the creation of the subacute program, patients were 
          treated in high-cost intensive care units of children's 
          hospitals or state developmental centers.  According to the 
          sponsor, current admission criteria are contained in 
          regulations and include a limited number of qualifying 
          conditions.  These regulations have not been updated to 
          reflect enhanced and improved technology such as BiPAP or 
          CPAP, which did not exist at the time regulations were 
          developed.  The sponsor argues these devices are now 
          commonly used as an alternative to a tracheostomy.

          The California Hospital Association (CHA) writes that 
          pediatric subacute care is a cost-effective alternative to 
          hospital-based care for critically ill children.  CHA 
          argues the clarification to medical necessity criteria in 
          this bill will support the appropriate and timely discharge 
          of children from the hospital setting to subacute care.

          Supporters contend that since pediatric subacute rates are 
          approximately one-fifth of those paid for care in a 
          pediatric intensive care unit of an acute hospital or a 
          state developmental center, substantial Medi-Cal savings 
          will also accrue every time a child is successfully placed 

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          in one of these facilities.  Children would also benefit 
          greatly from the specialty care, the 
          rehabilitation/developmental services, and the more 
          family-friendly environment offered in this setting.   


          ASSEMBLY FLOOR  :  70-0, 5/12/11
          AYES:  Achadjian, Allen, Ammiano, Atkins, Beall, Bill 
            Berryhill, Block, Blumenfield, Bonilla, Bradford, 
            Brownley, Buchanan, Butler, Charles Calderon, Campos, 
            Carter, Chesbro, Cook, Davis, Dickinson, Donnelly, Eng, 
            Feuer, Fletcher, Fong, Fuentes, Furutani, Beth Gaines, 
            Galgiani, Gatto, Gordon, Grove, Hagman, Halderman, Hall, 
            Harkey, Hayashi, Hill, Huber, Hueso, Huffman, Jeffries, 
            Jones, Knight, Lara, Logue, Ma, Mansoor, Mendoza, Miller, 
            Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Pan, 
            Perea, V. Manuel Pérez, Silva, Skinner, Smyth, Solorio, 
            Swanson, Valadao, Wagner, Wieckowski, Williams, Yamada, 
            John A. Pérez
          NO VOTE RECORDED:  Alejo, Cedillo, Conway, Garrick, Gorell, 
            Roger Hernández, Bonnie Lowenthal, Mitchell, Portantino, 
            Torres


          CTW:kc  7/11/11   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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