BILL NUMBER: SB 42	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MAY 10, 2011
	AMENDED IN SENATE  APRIL 27, 2011

INTRODUCED BY   Senator Alquist

                        DECEMBER 8, 2010

   An act to add Section 14107.14 to the Welfare and Institutions
Code, relating to public health.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 42, as amended, Alquist. Medi-Cal: contracts.
   Existing  law, the Knox-Keene Health Care Service Plan Act of
1975, provides for the licensure and regulation of health care
service plans by the Department of Managed Health Care. Existing
 law provides for the Medi-Cal program, which is administered by
the State Department of Health Care Services, under which qualified
low-income individuals receive health care services. The Medi-Cal
program is, in part, governed and funded by federal Medicaid Program
provisions. Existing law authorizes the department to enter into
various types of contracts for the provision of services to
beneficiaries, including contracts with managed care systems and
prepaid health plans.  Existing federal law provides for the
federal Medicare Program, which is a public health insurance program
for persons   65 years of age and older and specified
persons with disabilities who are under 65 years of age. 

   This bill would prohibit the department from entering into a new
contract, or extending an existing contract, with an organization
that the department or another state entity has determined received
state funds to coordinate services for patients eligible for both
Medicare and Medi-Cal pursuant to a contract and was overpaid
inconsistent with, or profited from capitated payments from the state
in excess of, what was authorized under the contract or state law.
This bill would provide that the department may enter into a
contract, or extend an existing contract, with an organization as
described above if the organization has repaid the amount of the
overpayment and any penalties that have been assessed. 
   This bill would require a health care service plan that
coordinates services for patients eligible for both Medi-Cal and
Medicare to report to the State Department of Health Care Services
and the appropriate budget and policy committees of the Legislature
if the actual use of services differs, as specified, from the
anticipated use of services assumed in the plan's capitation
agreement with the department.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 14107.14 is added to the 
 Welfare and Institutions Code   , to read:  
   14107.14.  A health care service plan that coordinates services
for patients eligible for both Medi-Cal and Medicare shall report to
the department and the appropriate budget and policy committees of
the Legislature if the actual use of services, in amount and type,
differs substantially from the anticipated use of services, in amount
and type, assumed in the plan's capitation agreement with the
department.  
  SECTION 1.    Section 14107.14 is added to the
Welfare and Institutions Code, to read:
   14107.14.  (a) If the department or another state entity
determines that an organization that received state funds to
coordinate services for patients eligible for both Medicare and
Medi-Cal pursuant to a contract was overpaid inconsistent with, or
profited from capitated payments from the state in excess of, what
was authorized under the contract or state law, the department shall
not enter into a new contract, or extend an existing contract, with
that organization.
   (b) The department may enter into a contract, or extend an
existing contract, with an organization described in subdivision (a)
if the organization has repaid the amount of the overpayment and any
penalties that have been assessed.