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: August 16, 2012 Consultant: Brendan McCarthy 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. AB 1803 (Mitchell) Page 1 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. AB 1803 (Mitchell) Page 2