BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | AB 667| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ 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 CONTINUED AB 667 Page 2 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; CONTINUED AB 667 Page 3 (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. CONTINUED AB 667 Page 4 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 CONTINUED AB 667 Page 5 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 **** END **** CONTINUED