BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 1095
                                                                  Page  1

          Date of Hearing:   August 8, 2012

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                    SB 1095 (Rubio) - As Amended:  August 6, 2012 

          Policy Committee:                             Business and 
          Professions  Vote:                            9-0
                       Health                           Vote: 13-0

          Urgency:     No                   State Mandated Local Program: 
          Yes    Reimbursable:              No

           SUMMARY  

          This bill authorizes the Board of Pharmacy to grant limited 
          licenses to outpatient settings and ambulatory surgical centers 
          (ASCs), so that they may purchase drugs at wholesale for 
          administering and dispensing to their patients.   

           FISCAL EFFECT  

          1)Estimated increased revenue to the Board of Pharmacy of 
            $180,000 in 2013, and $113,000 annually in subsequent years, 
            from initial and renewal limited pharmacy license fees. 

          2)Annual costs of $164,000 (fee-supported special fund) for one 
            pharmacy inspector position to handle additional inspection 
            workload.  

           COMMENTS  

           1)Rationale  . According to the author, this bill provides 
            physician-owned ASCs the proper licensing necessary to 
            administer high quality care by allowing them to purchase 
            certain drugs wholesale and store them on site.

           2)Background  .  Outpatient settings and physician-owned ASCs 
            operate under an individual licensed by the Medical Board of 
            California.  In addition to operating under a Board licensee, 
            outpatient settings that perform procedures using a specified 
            level of anesthesia must be accredited by one of four private 
            accrediting agencies approved by the Board. Prior to 2007, 
            physician-owned ASCs were also licensed by the California 








                                                                  SB 1095
                                                                  Page  2

            Department of Public Health (CDPH).  In 2007, a California 
            appellate court ruled that ASCs owned in whole or in part by 
            physicians were no longer eligible for licensure by CDPH.

            Since the ruling, CDPH is not renewing or granting any 
            licenses to a surgical clinic with any degree of physician 
            ownership, although it continues to certify these centers for 
            Medicare purposes.  The lack of CDPH licensure means that ASCs 
            may not apply for a limited license from the Board of Pharmacy 
            to purchase drugs at wholesale, for administration or 
            dispensing to patients in their care at these facilities.  
            This bill provides the Board of Pharmacy with narrow authority 
            to grant a limited pharmacy license to these facilities.  
            Without such a license, each physician at the facility must 
            procure at retail price and stock a supply of drugs.  

           Analysis Prepared by  :    Lisa Murawski / APPR. / (916) 319-2081