BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair


          AB 1803 (Mitchell) - Medi-Cal: emergency medical conditions
          
          Amended: June 12, 2012          Policy Vote: Health 9-0
          Urgency: No                     Mandate: No
          Hearing Date: June 25, 2012                            
          Consultant: Brendan McCarthy    
          
          This bill meets the criteria for referral to the Suspense File.
          
          
          Bill Summary: AB 1803 requires Medi-Cal fee-for-service benefits 
          to include emergency services when a medical condition could 
          reasonably be expected to result in jeopardy to the patient's 
          health, commonly referred to as the "reasonable layperson" 
          standard.

          Fiscal Impact: By placing the "reasonable layperson" standard in 
          statute, the bill would preclude the Department of Health Care 
          Services from reducing or eliminating payment for services 
          provided in an emergency department that were not thought to be 
          immediately necessary under the reasonable layperson standard. 
          The extent to which the Department could reduce Medi-Cal 
          expenditures by limiting payment for such non-emergency services 
          provided in an emergency department is unknown.

          Background: Under current state and federal law, Medi-Cal 
          enrollees in managed care plans are eligible for emergency 
          services under what is known as the "reasonable layperson" 
          standard. Under the reasonable layperson standard, health plans 
          are required to pay for emergency services provided to an 
          enrollee unless the enrollee did not require those services and 
          reasonably should have known that he or she did not need those 
          services.

          On the other hand, there is no federal or state law requirement 
          that Medi-Cal fee-for-service provide for emergency services 
          under the reasonable layperson standard.

          In practice the Department pays for emergency services in the 
          Medi-Cal fee-for-service program based on the services provided, 
          and does not attempt to determine whether the services were 
          genuinely related to an emergency condition.








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          Proposed Law: AB 1803 would specifically require Medi-Cal 
          fee-for-service benefits to include emergency services and would 
          apply the reasonable layperson standard to those services.

          Related Legislation: 
              AB 97 (Committee on Budget) Chapter 3 of 2011 (the health 
              budget trailer bill) increased copayments for non-emergency 
              services received in an emergency department from $5 to $50. 
              The bill also established copayments up to $50 for emergency 
              services received in an emergency department. The copayment 
              proposals in the trailer bill were not approved by the 
              federal Centers for Medicare and Medicaid Services and have 
              not gone into effect.
              AB 1467 (Committee on Budget, the health trailer bill) 
              would impose a $5 copay for non-emergency care received in 
              an emergency department under Medi-Cal managed care and 
              clarifies that the reasonable layperson standard applies to 
              emergency medical care in the Medi-Cal managed care program. 
              That bill has passed both houses of the Legislature and is 
              in Enrollment.

          Staff Comments: According to the Department, in 2008 the 
          Medi-Cal fee-for-service program spent about $360 million for 
          non-emergency services in emergency departments. Some unknown 
          portion of those services could have been expected to have 
          serious health impacts under the reasonable layperson standard 
          (such as chest pains) even if the ultimate diagnosis revealed 
          that the condition was not an emergency. On the other hand, some 
          unknown portion of those services probably would not be 
          considered an emergency, even under the reasonable layperson 
          standard (such as cold or flu symptoms).

          Under this bill, the Department could attempt to limit payments 
          for truly non-emergency services which do not meet the 
          reasonable layperson standard. However, by imposing the 
          reasonable layperson standard in law, the bill would preclude 
          the Department from withholding payments for non-emergency 
          services that were provided because the patient believed he or 
          she was experiencing symptoms that could reasonably be 
          considered signs of a medical emergency. 











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